The economic growth forecast for 2022, at 3.5%, of

The economic growth forecast for 2022, at 3.5%, of

The National Commission for Strategy and Forecast (CNSP) improved by 0.6 percentage points the growth forecast for 2022, to 3.5%, from 2.9% as estimated in the Spring Forecast, while for 2023 it reduced o to 3.7%, from 4.4%.

Thus, “The GDP growth forecast for the current year was improved by 0.6 percentage points (from 2.9% to 3.5%) as a result of the developments beyond expectations for some representative services (transportation, IT services, business services ), as well as the acceleration of construction activity growth in the second semester, stimulated by the PNRR implementation measures, as well as by government measures regarding the conditions for adjusting costs in construction contracts. However, a negative risk is emerging from agriculture if the drought conditions will persist for a long period”, emphasizes the CNSP in the medium-term forecast 2022-2026, summer version.

And on the demand side, the evolution of services in the structure of foreign trade led to the reestimation of the net export contribution to GDP growth, becoming slightly positive (+0.1 pp) in 2022, and the other components maintained their positive contribution, namely investments (+ 3.7%) and private consumption (+3.5%). The estimated level of inflation was increased compared to the previous version to 12.9% compared to 9.7% for the end of the current year and 12.6% compared to 10.1% as an annual average. The indices of the prices of industrial products, as well as the cost in construction, will continue their ascent to the level of previous estimates, registering double-digit dynamics, their evolution at an annual rate to be mitigated in the second part of the year as a result of a base effect.

Currently, the current account deficit was predicted to remain at high values, caused by a growing trade deficit, amplified by the higher price increases for imports, but being expected to register positive corrections in the medium term.

“On the other hand, the unfavorable effect of the current geopolitical context and international inflationary expectations will be seconded by the slowdown of the dynamics of the Chinese economy, with the accentuation of interruptions in the supply chains, and by the crisis of energy resources at the European level, shocks that will extend their impact over the year 2023.

And for the main partner countries in the euro zone, the new forecast of the European Commission has adjusted downward the economic growth in 2023 by about one percentage point (from 2.3% to 1.4%, where for Germany, from 2.4% to 1.3%).

Thus, the slowdown of economic activity at the European and global level in 2023, according to the estimates of international institutions, along with the other shocks mentioned, will also have the effect of decelerating the growth of the national economy to 3.7%, compared to 4.4% of the estimate precedent”, the summer forecast also shows.

On a quarterly basis, a weakening of the activity is anticipated in the first quarter of 2023 compared to the same period in 2022, after which it will relaunch under the positive influence of constructions and services, under the conditions of opportunity related to the exploitation of national resources and inflows of funds European.

“Even if an end to the conflict in Ukraine were to be taken into consideration, the maintenance of high prices for energy products and the weakening of the industry in Germany – Romania’s main commercial partner – will partially affect the local industry in 2023, especially the branches of chemistry, metallurgy , crude oil processing, as well as the automotive industry and that of equipment and machinery. Under these conditions, an increase of 2.3% in 2023 was estimated for the gross added value in the industry, down by 2.2 percentage points compared to the version in the spring forecast”, explains CNSP.

On the demand side, a sharper downward revision of private consumption dynamics for next year was considered, by 0.9 percentage points, under the impact of the slower return of wage purchasing power (+2.2% compared to +3.7% in the previous estimate), taking into account the fact that for the year 2022 the real wage will register a period of decreases in annual terms. In the case of gross fixed capital formation, the annual dynamics was revised by 1.4 percentage points below the previous estimate due to a lower import of equipment, but it remains at a high level (+7.2%).

In the medium term, the annual growth rate of the gross domestic product is estimated at 4.4% for the period 2024 – 2026, being supported by a significant contribution of the construction sector, the focus being on attracting and using the PNRR funds as efficiently as possible. Regarding services and industry (with average annual rates of around 4%), the development of those activities with an added innovative value is considered.

In the CNSP conclusion, it specifies that the standard forecasts are spring and autumn, the summer forecast being an intermediate one, which has a concise character and includes the information appearing in the interval between the spring forecast (which is the basis of the Convergence Program) and the autumn (representing the macroeconomic framework that usually underpins the budget).