Living on a budget
The document forecasts this year’s GDP at 1.116 trillion lei (229 billion euro), while the average inflation is expected to reach 2.4%.
The government also aims to cut the budget deficit to 2.9% by 2024.
Looking at a broader picture, the European Commission’s Interim European Economic Forecast Winter 2021 notes that the speed of recovery will vary significantly across the EU, while the start of mass vaccination campaigns has improved the outlook “beyond the near term.” “Furthermore, the agreement reached between the European Union and the United Kingdom on the terms of their future cooperation reduced the cost of the UK’s departure from the Single Market and Customs Union, while endorsement of the Recovery and Resilience Facility is set to support Member States on their way to a sustainable recovery,” the report added.
Moreover, the EU’s GDP is expected to grow by 3.7% in 2021 and 3.9% in 2022, and by 3.8% in both years in the euro area. In turn, inflation in the euro area and the EU is projected to be slightly higher in 2021 compared to last autumn. ”In the euro area, inflation is forecast to increase from 0.3% in 2020 to 1.4% 2021 before moderating slightly to 1.3% in 2022.”
As for Romania, the report points out that its real GDP is projected to grow by 3.8% in 2021, below the government’s 4.3% estimate, and by 4% in 2022. In turn, private consumption is seen recovering strongly from the second half of 2021, “as the rollout of vaccinations should allow for a gradual lifting of restrictions.” In addition, investments are expected to stay strong, on the back of the construction sector. In turn, exports are seen rebounding amid improving economic conditions. The average inflation rate is forecast to reach 2.6% in 2021 and 2.4% in 2022. The report added: “Risks to the growth forecast are tilted to the upside. Particular upside risks for Romania are a fast implementation of the Recovery and Resilience Plan and an improvement of public finances.”
Find more expert opinions and economic predictions in this new edition of our magazine, as Business Arena continues to keep an eye on all the issues affecting the business community.
Looking at a broader picture, the European Commission’s Interim European Economic Forecast Winter 2021 notes that the speed of recovery will vary significantly across the EU, while the start of mass vaccination campaigns has improved the outlook “beyond the near term.” “Furthermore, the agreement reached between the European Union and the United Kingdom on the terms of their future cooperation reduced the cost of the UK’s departure from the Single Market and Customs Union, while endorsement of the Recovery and Resilience Facility is set to support Member States on their way to a sustainable recovery,” the report added.
Moreover, the EU’s GDP is expected to grow by 3.7% in 2021 and 3.9% in 2022, and by 3.8% in both years in the euro area. In turn, inflation in the euro area and the EU is projected to be slightly higher in 2021 compared to last autumn. ”In the euro area, inflation is forecast to increase from 0.3% in 2020 to 1.4% 2021 before moderating slightly to 1.3% in 2022.”
As for Romania, the report points out that its real GDP is projected to grow by 3.8% in 2021, below the government’s 4.3% estimate, and by 4% in 2022. In turn, private consumption is seen recovering strongly from the second half of 2021, “as the rollout of vaccinations should allow for a gradual lifting of restrictions.” In addition, investments are expected to stay strong, on the back of the construction sector. In turn, exports are seen rebounding amid improving economic conditions. The average inflation rate is forecast to reach 2.6% in 2021 and 2.4% in 2022. The report added: “Risks to the growth forecast are tilted to the upside. Particular upside risks for Romania are a fast implementation of the Recovery and Resilience Plan and an improvement of public finances.”
Find more expert opinions and economic predictions in this new edition of our magazine, as Business Arena continues to keep an eye on all the issues affecting the business community.
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