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IMF improves estimates of Romania's economic growth in 2017, 2018
The International Monetary Fund (IMF) has marked up from 4.2 percent to 5.5 percent its growth estimates for the Romanian economy this year, according to the latest World Economic Outlook published on Tuesday by the IMF.
The IMF also improved its forecast for the pace of growth of Romania's economy in 2018 to 4.4 percent as against the 3.4-percent forecast released in April.
According to the world economic outlook document, Romania and Iceland will record this year's the largest economic growth in Europe of 5.5 percent.
Overall, Europe would see an economic growth of 2.5 percent, while Emerging Europe, a region including Romania, should witness a GDP growth of 4.5 percent.
Consumer prices in Romania this year, according to the estimates of the international financial institution, have been downwardly revised to a 1.1-percent increase, from a 1.3-percent increase as forecast in April, with the increase in prices expected to accelerate in 2018 to 3.3 percent, above the 3.1-percent increase previously projected by the IMF.
The IMF also revised its current account deficit projected for Romania to 3 percent in 2017 (from 2.8 percent previously) and 2.9 percent in 2018 (as against 2.5 percent forecast in April).
On the other hand, the IMF has marked down its estimates of unemployment in Romania, which is expected to stand at 5.3 percent this year, compared with 5.4 percent previously estimated, to reach 5.2 percent in 2018, similar to the forecast in April.
Romania's National Statistics Institute (INS) has slightly marked up Romania's GDP growth in the second quarter of this year, according to new data released on Tuesday, showing the Romanian economy having climbed 1.7 percent in real terms on a quarterly basis, and 6.1 percent (raw series) from the same quarter of the year before.
In the first six months of 2017, Romania's economic growth was 5.9 percent in raw series and 5.8 percent when seasonally adjusted. Data released in September showed the Gross Domestic Product advanced 5.8 percent in raw terms in H1 2017, y-o-y, and 5.7 percent in seasonally adjusted terms.
The most significant contribution to the GDP growth was provided by final consumption (5.2 percent, slightly lower than the data published in September, which showed a contribution of 5.4 percent).
Premier Mihai Tudose, speaking Monday evening at a show of public broadcaster Antena 3, said that the government has no intention to take out an IMF loan; Tudose thus answered a question as to whether the government is considering this option.
"Honestly, in no case, and I let them know this too, because having in view the forecasts they made and the way they treated us, excuse me but we should be in a desperately dire situation, when the money we potentially took out from the Fund would be to no avail. I won't take out one dime in loan from the IMF," Mihai Tudose insisted, adding that Finance Minister Ionut Misa is on a trip to the US for talks with international financial institutions, but not with the IMF.
The PM added that the government will have recourse to other financial instruments if needed, such as "eurobonds or government bonds".
Asked if he considers the IMF to be responsible for the situation prompted by the 2010 wage cuts, Tudose replied: "Well, they nonchalantly publicly said 'we were a bit wrong'."
"They disrupted a country's and people's life in a disastrous way. Now they were off point with one forecast, they went wrong with the second, I did my duty to let them know that if they screw up the third forecast too we might never again talk to them, not even out of courtesy, when they undergo a line-up change. They became a little more cautious. I am not talking about the International Monetary Fund as an organisation, but the people they send here, on selection criteria that escape my knowledge, are rather off the path. (...) My discussion with them was just like that: you make one more blunder and I will react violently because I will understand this is an attack on the country, on the country rating," Tudose said.