WB revises down forecast on Romania’s economic growth in 2013

The World Bank (WB) has revised its economic growth forecast for Romania this year from the 2.8 per cent it estimated in mid-2012 to 1.6 per cent, against the backdrop of a slow recovery at regional level determined by the continued presence of factors that limited GDP growth last year. The bank estimates for Romania an economic growth of 2.2 per cent in 2014, down from the 3.4 per cent it estimated in mid-2012. In 2015 the Romanian GDP is expected to grow by 3 per cent. The World Bank’s forecast is slightly more pessimistic than the economic growth that the government estimates for this year. The government has set an economic growth target of 1.8 per cent in 2013, but hopes to reach a growth of 2 per cent in an optimistic scenario, after a growth of 0.7 per cent last year. At the start of November the European Commission was estimating an economic growth of 2.2 per cent for Romania this year, and one of 2.7 per cent next year. “The recovery is expected to be low in 2013 (in Europe and Central Asia – editor’s note), since most of the factors that limited growth last year will probably persist even though at a lower intensity. The region’s outlook critically depends on the tackling of the high budget and current account deficits, the unemployment and inflation rates, the lack of competitiveness and other structural limitations of these economies,” the World Bank’s World Economic Outlook report shows. The GDP of Europe and Central Asia, a region consisting of 21 states with developing economies, will register a 3.6 per cent growth in 2013 and a 4 per cent growth next year. The economic outlook remains vulnerable to serious global and regional risks, the World Bank points out. Considering the close financial and commercial ties between the Euro Area and countries in Europe and Central Asia, the region would be directly affected by a major deterioration in the sovereign debt crisis, and also by the Euro Area’s stagnation or slow economic growth. According to the World Bank, Bulgaria will register an economic growth of 1.8 per cent this year, Ukraine of 2.2 per cent, Serbia of 2 per cent, and Turkey of 4 per cent. At the same time, the Republic of Moldova will register a GDP growth of 3.1 per cent, Latvia of 3 per cent and Lithuania of 2.5 per cent.

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