The National Forecasting Commission (CNP) sees Romania’s GDP at almost EUR200 billion in 2018, which means Romania will most likely beat Czech Republic and Greece, but the two countries have a population of ten million people each. Romania passed the previous milestone of EUR100 billion after 2006 when the GDP stood at EUR99 billion.
Back in 1990, the GDP was EUR35 billion in today’s money. The doubling of the GDP in about ten years means we can assume that Romania will have a EUR400 billion GDP by 2027. Poland’s GDP stands at EUR424 billion today.
The National Forecasting Commission revised its 2017 growth forecast in its fall revision from 5.2% to 5.6%, which means forecasts for the coming years will be revised, as well.
The GDP should reach 837 billion lei (EUR182 billion) in 2017, up from RON815 billion estimated in the spring. The 2018 forecast should therefore be above RON900 billion. The National Forecasting Commission expects RON901.7 billion GDP in 2018, which means an estimated economic growth of 5.5%. This could put Romania’s economy ahead of Czech Republic and Greece’s and close to Portugal’s.
Although economists expect growth to stand at more than 5% in 2017, they doubt it will continue at the same rate in 2018.
“It would be nice, but I don’t think it’s possible. I don’t even think it will reach the 5.6% forecast for this year. In my opinion, it will be 5.2% to 5.4%. On the other hand, it is hard to lie in statistics,” says economist Dragos Cabat.
Raiffeisen Bank is one of the banks that revised their economic growth forecast even higher than the government’s target of 5.6% for 2017. Romania’s economy should grow by 5.7% this year but Ionut Dumitru, Raiffeisen Bank’s chief economist, says the growth estimate for 2018 is 4%.
“The economy has been growing through fiscal incentives quite a lot in the past two years. Next year it will no longer have these incentives, so we don’t see where growth of more than 5% might come from. On the other hand, CNP sees 5.1% growth of potential GDP for next year. The potential GDP is based on investment or on labor. Government is hardly making any investments and nothing spectacular is happening on the labor market. We don’t see where a 5.1% growth of potential GDP could come from in 2018, which are now estimating at 3%.” (EUR1=RON4.5982)
(English version by Loredana Fratila-Cristescu)