IMF Report // Romania: the highest economic growth on the continent in 2016 and 2017
Romania will have an economic growth of five percent in 2016, the highest in Europe, shows the autumn estimations of the International Monetary Fund. Romania will stay on top of the European economic growth ranking in 2017, when will register a 3.8 percent advance of the GDP (the same as Iceland), according to the last report "World Economic Outlook," released on Tuesday.
Romania's economic growth in 2016 is above that of Ireland, which last year had a record advance of 26.3%, compared to an increase of 3.8% registered by Romania. In addition, the IMF estimations for 2016 expect a negative inflation of minus 1.5%, a current account deficit of 2% from GDP and an unemployment rate of 6.4%, that decreased by 0.4 points in regard to 2015.
National Statistics Institute Data showed a GDP growth of 6% in Q2 year/year, and 5.2% in S1 in relation to S1 2015. Therefore, most analysts and institutions that are doing macroeconomic researches have revised upwards the economic growth forecasts. Thus, if Romania's budget is built on an economic growth of 4.1%, most analysts estimate a growth to 5% this year, the IMF is one of the last institutions, which increased its forecasts upwards.
For the next year, according to the Washington-based institution, growth will lower to 3.8%. In the April report, IMF estimation of growth was of 4.2% for Romania.
In regard to 2017, the IMF forecast is that GDP growth will be 3.8%. However, it is a better forecast than the April one - 3.6%. In addition, this growth for Romania would be the strongest in the EU (3.8% of growth also recorded in the mentioned forecast only Iceland). On average, the EU will increase in 2017 by 1.8% and "emerging Europe" by 3.1%.
In respect to the inflation, the IMF estimations for 2016 have been revised from minus 0.4 percent in April to minus 1.5 percent. However, from 2017 the inflation will return to plus: 1.7 percent.
Regarding the current account deficit, it would be 2 percent of GDP in 2016, towards 1.7 percent, as estimated the institution in April report.
The current account deficit will get steeper next year, when it is expected to reach minus 2.8 percent, from minus 2.5 percent as estimated in Spring.
The unemployment rate would be 6.4 percent in 2016 and 6.2 percent in 2017.
The IMF has kept its spring forecasts on the world economy growth: 3.1 percent in 2016 and 3.4 percent 2017.