Romania’s growth to slow down at 2 percent in 2014, says GarantiBank

GarantiBank notes in its quarterly report that Romania’s economic growth is expected to slow down at 2 percent next year from this year’s 2.4 percent gain, due to a lower production in agriculture and the deceleration in industrial production growth.

Excluding the agriculture component, the GDP should actually improve growth from 1.3 percent to 2 percent year-on-year, according to the Turkish lender.

“The industrial production growth should temper in 2014. The year 2013 was marked by the start of a new production line in the car industry, which was mainly oriented to exports,” said the lender.

Read more about

Concrete Example of Transition to the Circular Economy

read more

“We expect the construction segment to grow slightly, benefiting from the support provided by the EU funds (the first positive sign can already be seen in the construction index in Aug-Sept) and the acceleration in EU funds absorption in H2 (July-Nov absorption of EU funds of EUR 1.5, more than in the first 6 months, period in which the absorption of EU funds amounted to EUR 1.1 bn),” it added.

GarantiBank’s specialists expect the inflation to reach a fresh low of 1 percent in the first half of 2014, and accelerate to 3.5 percent in the second part of the year.

“The lower inflation will give a boost to the purchasing power, and the financing in local currency will become more attractive, respectively cheaper. These factors, alongside the growth of real wages, will have a positive contribution to the internal consumption and the domestic demand in 2014”, stated Rozalia Pal, chief economist at GarantiBank.

Ovidiu Posirca