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Erste Bank analysis: From recovery based on exports to a more significant increase
“Due to the strong credit increase and the reverse of the evolution of net loans in the last two years, the need for a later adjustment of saving rates in ECE countries is practically more reduced,” said Juraj Kotian, Macro ECE research manager within Erste Group aid. Also consumption will be linked to the increase of available incomes which will improve by 1-2.5% annually, in real terms next year, contributing to supporting GDP increase. “Romania is exempted from that as the higher inflation rate will reduce incomes by 0.8% per year next year.” As a result, we expect that we expect an economic recovery. As a result we expect economic recovery determined by exports and an 016 to become more balanced. Moreover, sustainable savings exchange rates and the net loan credit should determine a less vulnerable consumption increase in ECE in the following years.
Despite a more rapid nominal increase in ECE compared to advanced savings , GDP per capita expressed in euro remain at a level lower than that of savings, reaching only 15 and ½ of the euro area average. In the ECE area differences predimante, the Czech Republic being the richest country in the area while Romania, Serbia and Ukraine are at the opposite end of the classifi9cation.. However GDP calculated according to exchange rates based on the parity of the purchase power is more relevant that GDP expressed in euro as it is more relevant as it expresses the difference between price levels in all economies and harmonizes the effect of exchange rate fluctuations.
Unitary costs with labour force in ECE countries are considerably lower compared to the EU average, while the participation rate in the labour market can increase by eliminating barriers which do not allow certain citizens to enter the labor market.