EIU envisions 2.6% economic growth

The Economist Intelligence Unit (EIU), the analysis and research division of British magazine The Economist, estimates Romania will register 2.6% economic growth this year, Fiona Mullen, Senior Analyst for transition economies, told Ziarul Financiar.

International financial institutions have issued less optimistic forecasts regarding Romania’s economic development, as compared to Romanian authorities who say that economic growth will register a 4-5% increase this year. According to the EU, GDP will increase by 1.6% this year.

Fiona Mullen says the EIU forecast is based on the increase of domestic consumption, triggered by the raise of the minimum salary and pension benefits, as well as the “sound” investments to be further operated in Romania. “Several companies have announced sound investment plans,” Mullen said.

EIU estimates that exports will increase by only 7% this year, against the 24% registered last year, due to the economic slowdown in several countries such as Italy, Turkey and Germany, which are important traditional trade partners for Romania.

EIU analysts forecast that the current account deficit will go up this year, but this will be not a reason for concern, as it will stand below 5% of GDP.

They say the current account deficit will be positively influenced by the oil price in Romania, which is lower than the international price, and by the general low prices on the international market.

The current account deficit stood at 107 million dollars at the end of January, up 2.4% against the year-ago period.