Economy Minister: Despite two straight quarters of decline, Romania’s economic trend still positive


Although Romania’s economy recorded two straight quarters of decline, it stays on a positive trend with a seasonally adjusted economic growth of 2.6 percent in the first half of 2014 compared to the similar period of 2013, Economy Minister Constantin Nita said in a press release to Agerpres on Monday.

‘The first aspect we need to underscore as regards the latest data on the Gross Domestic Product, released by the National Statistics Institute is the fact that although Romania’s economy saw two straight quarters of decline in the GDP, considering the entire examined period, it remains on a positive trend with a seasonally adjusted economic growth of 2.6 percent compared to the similar period of 2013. From this point of view, the signal given by the technical definition of the economic recession, two straight quarters of economic decline, should not diminish the importance of the consolidated quarterly economic advance of 2.6 percent,’ the release reads.

According to Nita, the advance in Romania’s GDP in the first quarter is also supported by certain key economic indicators such as exports, the industrial production and the retail trade.

‘The exports in the first half amounted to 25.5 billion euros, up 7.6 percent compared to the same period of last year. In addition, the industrial production grew by 9.1 percent in the same interval compared to the first half of 2013 and the retail turnover volume edged up 8.6 percent,’ Nita pointed out.

The advance of 2.6 percent in the GDP in the first half of the year is on track for the 2.8 percent year-end growth target set up by Romania’s Government, the International Monetary Fund and the World Bank.

‘From this viewpoint, the signal regarding a possible derailment of the Romanian economy from the economic growth targets is not backed by economic arguments. Despite the consolidated quarterly economic advance of 2.6 percent, we should not ignore either the slowdown in Romania’s economy recorded in the second quarter of 2014, which fell by 1 percent compared to the first quarter, despite a seasonally adjusted growth of 1.4 percent compared to the same period of last year. The very high reference value in the first quarter, when the GDP advance of 3.8 percent was the largest in the EU and the modest results registered by the majority of the European economies in the second quarter may largely explain this slowdown in Romania’s economy in the past three months,’ the document reads.

The GDP remained stable in the Eurozone and rose by 0.2 percent in the EU in the second quarter compared to the first quarter, according to Nita.

‘The dependence of Romania’s economy upon the evolution of the European economies is obvious if considering the value of the intra-community exchanges in the first half of 2014, which stood at 18.3 billion euros in terms of exports, accounting for 71.7 percent of the total. At the same time, the signal given by the economic slowdown in the second quarter confirms the need to continue the Government’s efforts to enforce economic revival measures by attracting foreign direct investments and launching major infrastructure projects that will lead to new jobs and a developed local industry,’ Constantin Nita said.

 

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