The high level of non-performing loans, of over 20% of total loans, may also weigh on growth prospects in the near term, the bank said in its latest Regional Economic Prospects report.
For 2015, the EBRD estimates a growth of 2.8% in Romania.
“Economic activity in Romania has improved in 2013 above market expectations. The gross domestic product rose by 3.5%, mainly on account of a strong export performance and an exceptional harvest. Growth is expected to be around 2.6% in 2014, slightly rising in 2015, driven by exports and a pick-up in domestic demand,” the report noted.
EBRD also raised its growth estimate on southeastern Europe to 2.2% in 2014, from 2.1% previously.
However, the international lender has cut its 2014 growth forecast on the region of operations to 1.4% from 2.7% initially, amid mounting uncertainties due to the crisis in Ukraine.
“The negative spillovers are expected to be largely contained to the neighborhood of Russia and Ukraine under our central scenario, though several central and southeastern European economies will also see some impact,” EBRD said.
“Under a less benign scenario including the imposition of financial sanctions in particular, Russia would slip into recession and average growth in the region would grind to a halt in 2014-2015,” the report showed.