GDP drops in Q4

Economic growth will not exceed 4.9% this year, although the Gross Domestic Product (GDP) posted a growth pace of 5.1% over the first nine months of the year.

Authorities are expecting the fourth quarter to post less impressive results than the previous quarters, as agriculture can make no contribution this time of year and, furthermore, the interval is shorter.

“I believe we will stop at 4.9%. The nine-month results were possible due to the strong influence exerted by agriculture, which posted a 21% increase as compared to last year. October is generally a bad month, while December is a month with less work,” Development and Prognosis minister Leonard Cazan told Ziarul Financiar.

“The GDP increase for this year will stand at 4.9%, exceeding the government’s 4.5% target, while the current account deficit will amount to 5.8%, below the estimated level of 6%,” says Finance minister Mihai Tanasescu.

The economic growth target estimated for next year in the stand-by agreement with the International Monetary Fund stands at 5%.

“Next year, we will mainly focus on maintaining the economic growth pace at 5%. We think this is a realistic target, even considering the trends posted after September 11,” Tanasescu states.

According to the Finance minister, the government policy objectives concerning economic growth, the current account deficit and the inflation rate for this year will be met.

“Our inflation objective will be attained because the inflation rate will stand at 29.8% at the end of the year, below the 30% level estimated by the Government,” Tanasescu maintains.

On the other hand, Cazan estimates the inflation rate will stand at 29.9% at the end of 2001, taking into account a monthly rate of 2.6% in November and the 2% forecast for December.

“The December inflation has never outpaced the levels registered in October and November,” Leonard Cazan says. The authorities hail the inflation cut, down from the level of 41% posted last year.