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The IMF representative for Romania and Bulgaria Alejandro Haydenberg presented the report for the CESEE region
The resident representative of the International Monetary Fund (IMF) in Romania and Bulgaria, Alejandro Haydenberg, presented on Monday the spring economic report for Central Europe and South-East Europe (CESEE). The event was attended by the governor of the BNR Mugur Isarescu, vicegovernor BNR Liviu Voinea and the representatives of European Department of IMF.
According to the IMF for the CESEE region published on Friday, the economies in Central Europe and South-East Europe must make reforms to increase productivity and stimulate investments and improve the offer of work hands to accelerate the process of convergence.
After a solid growth in 2015, the region of Central Europe and South-East Europe goes to a challenging period. A more reduced growth in the euro zone and the US, the harshening of the global financial conditions and the weaknesses in many emerging economies create trouble. Even so, on a short term, the growth is estimated to stay robust in the majority of the states in CESEE due to a domestic solid demand, says IMF.
‘In Romania, there is a cyclic relaunching, and the growth is estimated to strengthen, supported by the increase of salaries, the reduced prices for fuel and the reduction of VAT’ the report says.
But IMF says that, despite a cyclic relaunching, the growth in CESEE is under the level of the period before the crisis and if this growth becomes a normality this means a slower rhythm of convergence with advanced Europe.
At the same time, IMF recommends the economies in CESEE to stimulate investments as it would be necessary to solve a series of structural matters to stimulate private investments. ‘ New progress could be necessary, especially in Romania and Bulgaria where the saving rates for households continue to be negative’ IMF warns.
As a consequence, the Fund appreciates that the policies should concentrate on institutional reforms which reduce inefficiencies and increase the profit of investments and private savings.
In his latest report ‘ World Economic Outlook’ published at the beginning of April, the IMF a revised upwards at 4.2% the estimates regarding the evolution of the Romanian economy this year from 3.9% as it was estimated in October last year. According to the IMF estimates, Ireland is the only country in Europe which will record this year an economic growth higher than that of Romania of 5% while as a whole Europe will record an economic growth of 2% and Emerging Europe, the region including Romania will record an advance of GDP of 3.5%.