Gross domestic product expanded at an annual rate of 0.3% in real terms in the first quarter, the country’s statistics institute INS said in a second estimate Wednesday. Compared with the fourth quarter of 2011, Romanian economy shrank by 0.1%. The figures are unchanged from last month’s estimate.
Government expenditure with public administration, defense and other services fell at a 5.8% annual rate in the first three months of 2012, while spending on administrative services and research was down 5%, the data showed.
Construction activity slid 1.2% in the first quarter from the year-ago period, while real estate and financial and insurance sectors had a negative contribution of 1% and 1.2% to the economic growth, respectively.
The decline more than offset a 4.2% increase in the agriculture sector, INS data showed.
On the positive side, information and communication contributed 2.6% to the first-quarter GDP growth, while retail sales inched up 0.7% on the year.
Domestic demand advanced at an annual rate of 1% in the first quarter, supported by an 11.8% increase in gross capital formation. However, final consumption nudged down 0.3% on the year, largely due to a 3.6% decline in public administration spending.
Exports declined 2.9% on the year in the first quarter, while imports fell at a slower pace of 1.2%, the data showed.
Romania forecasts economic growth will slow to 1.5% in 2012, from 2.5% a year earlier.