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March 9, 2021

Raiffeisen Bank: Budget deficit to reach 5.5 pc of GDP in 2009

Romania’s budgetary deficit shall account for 5.5 per cent of GDP in 2009 and 3.5 per cent of GDP in 2010, based on the Romanian accounting standards, according to the analysts of Raiffeisen Bank, in their latest report published on Friday, cited by The Money Channel.

Based on the European accounting standard ESA 95, the public deficit shall account for 6 per cent of GDP in 2009 and for 4 per cent in 2010, the report of Raiffeisen Bank indicates. For 2009, the Government committed to a target of 4.6 per cent of GDP for the budgetary deficit, based on Romanian accounting standards, considering that the economy shrinks by 4 per cent.

At the same time, the bank analysts revised downwardly their estimations related to Romania’s Gross Domestic Product (GDP), to 4 per cent decrease in 2009, because of the negative estimations related to the deterioration of activity in agriculture because of the drought, the delay in public investments and because economy altered faster than expected in the past few months. They maintained the forecast related to the economic growth in 2010 to 1.5 percent. Raiffeisen Bank analysts expect a decrease in Romania’s GDP in Q2 and Q3 as against the previous quarters, and then in the past three months of 2009, the economic growth switches to a positive trend compared to the previous quarter. The average unemployment rate shall be 5.6 per cent in 2009 and it will advance to 6.5 per cent in 2010, the analysts estimate.

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