BUSINESS

New budget correction by early July

The government adopted the IMF forecast of an economic slump by 0.5 per cent for this year, and the Ministry of Finance is due to correct the budget in keeping with this figure by late June-early July, daily ‘Ziarul Financiar’ informs. “The last figure we received from the National Forecast Commission (CNP) for the nominal value of the GDP in 2010 is RON 510.449 bln, which equals a slump of the economy by 0.5 per cent for this year. However, the value will also depend on the GDP deflator,” Gheorghe Gherghina, state secretary in the Ministry of Finance, explained. Despite positive estimates at the beginning of the year, prospects for economic evolution have gradually darkened lately.


In April, the IMF revised its forecast for this year at 0.8 per cent compared to the earlier estimate of 1.3 per cent. A month later, representatives of the IMF stated they estimated a stalling or even a slump of the economy by 0.5 per cent compared to 2009. Bleaker prospects for the economy cut short the tide of optimism at the beginning of this year, when the figures circulated even included a potential growth of over 2 per cent of the GDP in 2010. In the first quarter, economy continued to slump, and a switch to quarterly growth mode is, probably, postponed for the second term. Although in March there have been positive signs from the real economy, these could not make up for the weak performance in preceding months. According to statements made by the head of CNP, Ion Ghizdeanu, Romania has the capacity to emerge from recession, and economy could start growing at the latest in the last quarter. However, the head of the forecast office reckons that only in 2012 could Romania enjoy a healthy “dynamics”.

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