Q2 industry advance, slowest rate of the past year and a half

Industry in the second quarter increased by only 4.4% and slowed down significantly after the first three months of this year, when the rate hit 7.8%. The Q2 growth rate was the slowest recorded since the end of 2005, when industry growth was affected by floods and also by rapid RON growth. Under the circumstances, industry advanced by 5.9% in the first half of the year against the same period in 2006, according to data from the National Statistics Institute. Given the close link between economic and industrial development, industry was responsible for the slowdown of the overall economy in the second quarter. Economic growth stood at 5.6% in the first half, compared with 6% in the first quarter. In fact, industrial output accounts for 27% in GDP, second after services. Despite the noticeable economic slowdown, the Minister Economy and Finance Varujan Vosganian remains confident GDP growth will accelerate in the second half. Although GDP growth was significantly below market estimates, analysts are still confident of this year’s economic development.