National Prognosis Commission revises upwards again, to 6.1 pct, economic growth estimate for 2017

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The National Prognosis Commission (CNP) has revised upwards again estimates for Romania’s economic growth in 2017, to 6.1 per cent from 5.6 per cent, as previously estimated.

According to the autumn estimation the Gross Domestic Product will reach 842.5 billion lei this year, going up from 837.1 billion lei, as previously estimated for the preliminary autumn forecast.

The Gross Domestic Product will reach 43,010 lei according to estimates (42,734 lei at the preliminary forecast).In 2018 it will go up to 46,617 lei, in 2020, up to 56,644 lei and, in 2021, up to 58,885 lei.

Individual household consumption will surge 8.5 per cent in 2017 (compared with 7.9 per cent the initial estimates), while government consumption will grow by 1 per cent (2 per cent at previous estimates).

CNP has maintained the GDP growth forecast for 2018, 2019 and 2020, up to 5.5, 5.7 and 5.7 per cent respectively, while the increase for 2021 is estimated at 5 per cent.

The International Monetary Fund (IMF) has also recently revised upwards its forecast for the growth rate to be recorded by the Romanian economy in 2018, up to 4.4 per cent, compared with the growth of 3.4 per cent estimates in April.

According to the World Economic Outlook, Romania and Iceland will be the countries recording the highest economic growths in Europe, this year, of 5.5 per cent.

In its turn, the World Bank on October 20 announced the Romanian economy will grow over potential in 2017 and 2018, according to the latest Regional Economic Update, Migration and Mobility in Europe and Central Asia report.

“The GDP will probably grow by 5.5 per cent this year, due to the measures of fiscal stimulation and the improvement of the European economy. The increase in consumption is expected to push the current account deficit up to 3.1 per cent in 2017, from 2.4 per cent in 2016. Inflation is also expected to grow, in reflection of the excessive internal demand and the mitigation of tax cuts effects. The National Bank of Romania is expecting a gradual increase in inflation close to 2 per cent at the end of 2017,” shows the WB report.

The World Bank estimates a GDP expansion of 4.1 per cent for 2018 and 3.6 per cent for 2019, with the current account deficit being expected to reach up to 3.5 per cent next year and 3.8 per cent in 2019.