It sees inflation at 2.2% this year from 3.8% in 2019, a current account deficit of 5.5% of GDP from 4.7% in 2019, and unemployment rising to 10% from last year’s 3.9% in the fallout triggered by the coronavirus pandemic.
Romania’s gross domestic product grew 4.1% in 2019.
For 2021, the IMF sees the country’s economy growing 3.9%, inflation at 1.5%, a current account deficit of 4.7% and unemployment falling to 6%.
As a result of the pandemic, the global economy is projected to contract sharply by 3% in 2020, much worse than during the 2008–2009 financial crisis, the IMF said.
Just last week, the World Bank revised its forecasts to include the negative impact of the coronavirus crisis and currently sees Romania’s economy slowing significantly to 0.3% of GDP from a previous growth projection of 3.8%.
The World Bank’s projection operates on the assumption that growth would gradually bounce back in the second half of 2020 and further accelerate in 2021 to 4.4%. However, the risk of a recession in 2020 is substantial and growing as Covid-19 brings to a halt large segments of the European economy and disruptions to global supply chains and trade patterns, it said.
Romanian Prime Minister Ludovic Orban said last week the government expects the economy would contract 1% to 3% in 2020 but analysts believed the projection was overly optimistic.