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November 20, 2019
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FinMin Misa meets EC’s Dombrovskis: Romania to keep budget deficit below 3pct as set up by Stability and Growth Pact

Romania will maintain the budget deficit below 3 percent as it had committed though the Stability and Growth Pact and the economic growth of 5.6 percent forecasted for 2017 is based both on consumption and the increase of industrial production, Public Finance Minister Ionut Misa assured within a meeting with Vice-President for the Euro and Social Dialogue of the European Commission Valdis Dombrovskis, who is also in charge of Financial Stability, Financial Services and Capital Markets Union.

According to a press release of the Public Finance Ministry (MFP), in the context of the informal meeting of the Economic and Financial Affairs Council (ECOFIN), organised by the Estonian presidency between 15-16 September, the Romanian Finance Minister had a bilateral meeting with the European Commission official, Valdis Dombrovskis, and the discussions aimed at aspects regarding the macro-economic situation of Romania, as well as the future of the Economic and Monetary Union (EMU).

The Romanian official pointed out the 5.6 pct economic growth of 2017, based both on consumption and the increase of industrial production which was higher by 8 pct compared to the same period of the previous year, as well as the decline of the unemployment rate, that was 5.2 pct in July 2017, compared to the European average of 7.7 pct.

Moreover, during talks, the growth of the Gross Domestic Product (GDP) and the positive revision “accomplished due to the increase of revenues of the general consolidated budget” were also mentioned. In addition, Minister Ionut Misa reconfirmed Romania’s commitment in respect to keeping the budget deficit below 3 pct, set up by the Stability and Growth Pact.

In his turn, Valdis Dombrovskis praised Romania’s results and showed openness to dialogue in the future, the quoted source mentions.

 

National Prognosis Commission revises upwards to 5.6 pct its economic growth estimate for 2017

 

According to the autumn preliminary projection published on Friday by the National Prognosis Commission (CNP), the estimations regarding Romania’s economic growth in 2017 were revised to 5.6 pct from 5.2 pct, as per the previous forecast.

According to this fall’s preliminary projection, the Gross Domestic Product (GDP) will be 837.1 billion lei this year, as to 816.5 billion lei in the spring estimate. Furthermore, the GDP per capita in 2017 is estimated at 9,392 euro (9,279 euro in the spring projection). This indicator will go up to 10,243 euro in 2018; 11,140 euro in 2019; 12,063 euro in 2020; and in 2021 it will reach 12,994 euro.

The individual consumption per household will grow in 2017 by 7.9 pct (6.8 pct in the previous estimate), and the consumption of the public administration will rise 2 pct (1.6 pct in the previous projection).

CNP maintained the GDP growth projection for 2018, 2019 and 2020 at 5.5 pct, 5.7 pct and 5.7 pct, respectively, whilst for 2021 it estimates an increase of up to 5 pct.

The international institutions are to announce this month and the next, the growth forecast for Romania.

The European Bank for Reconstruction and Development (EBRD) estimated on May 10, that Romania’s economy would record this year an advance of 4 pct, compared to an increase of 3.7 pct foreseen in November.

Moreover, the International Monetary Fund (IMF) revised upward the estimations regarding Romania’s economic growth in 2017, from 3.8 pct up to 4.2 pct, according to the most recent “World Economic Outlook” report, published in April by the international financial institution before the spring meeting.

Furthermore, according to the regional report published on 11 May by the IMF, this year, just like in 2016, the South-Eastern European states that are members of the EU (Romania, Bulgaria and Croatia) will overall register the highest growth rate of all the states in the region, namely 3.7 pct, even if it is lower than 4.2 pct recorded in 2016.

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