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EBRD: Romania and Montenegro will have highest CEE growths in 2016
Romania and Montenegro will register a 4% increase each in 2016, the highest level in South Eastern Europe, according to a report published on Wednesday on the occasion of EBRD General Annual Shareholders’ Assembly. In the November 2015 report, EBRD estimated an advance of Romanian economy of 3.7% this year.
Romania’s GDP advance will slow down to 3.5% in 2017, according to the latest EBRD forecasts.
South Eastern Europe (Albania, Bosnia and Herzegovina, Bulgaria, Cyprus, Greece, Macedonia, Kosovo, Montenegro, Romania and Serbia) will record a 2.4% increase this year and 2.9% next year.
Economies in regions in which EBRD is present show modest recovery signs after five consecutive years of slowing down, while the recovery expected for this year is slightly lower than estimated 6 months ago. In the last years, EBRD extended its area of operations in 36 countries, from Europe to Northern Africa and Central Asia. Average increase in those states will be 1.6% this year and 2.5% next year, EBRD estimates.
States will benefit from effects of crude price decline, but may be affected by increase of volatility in global financial markets, lower capital incomes in emerging markets, weakness of world trade and increase of geopolitical tensions, the report shows.
Even if in the centre, southern and eastern Europe, where economic performances were more solid, the expansion rate is inadequate. Investment level remains lower than it should be, while economic advance is sufficiently strong to achieve convergence with more advanced economies, the senior economist of EBRD, Hans Peter Lankes said.
The Baltic states, countries from Central and South Eastern Europe benefit from the lowest price of energy and monetary policy relaxation from CEB, the EBRD report shows.
EBRD, owned by 64 countries and two inter-government institutions backs the development of market economies and democracies. In the last years, EBRD has shifted attention from the former Soviet bloc to Northern Africa and countries like Turkey. Since the beginning of its activity, EBRD has invested about 7 billion euros in over 368 projects in Romania. In 2014 Romania was the 6th country in the top of main beneficiaries of EBRD investments.