IMF Revises Balkan Growth Prospects Downwards

The International Monetary Fund, IMF, paints a gloomy picture of the economic prospects of Balkan countries in 2014.

In its flagship half-yearly World Economic Outlook, the IMF said countries in Southeast Europe in particular are likely to experience slower growth in 2014 partly because of the severe floods that struck Serbia and Bosnia in May.

Growth is likely to pick up in 2015, however, as governments spend money on reconstruction, rebuilding flood-affected areas and, in some countries, employment grows.

The IMF has revised its forecast of Romania's economic growth downwards from 2.8 per cent anticipated in June to 2.4 per cent.

Croatia is expected to grow negatively by -0.8 per cent in 2014, compared to an anticipated -0.6 per cent in June.

Serbia is likely to record -0.5 per cent economic growth this year, down from an anticipated 1.0 per cent growth in mid-2014.

Bulgaria is likely to grow by 1.4 per cent this year, down from 1.6 per cent anticipated in June.

All the Balkan countries mentioned are likely to record positive economic growth in 2015, according to the IMF report.

Romania is expected to grow by 2.5 per cent, Bulgaria by 2 per cent, Serbia by 1.0 per cent and Croatia by 0.5 per cent.

IMF expects inflation in emerging and developing parts of Europe to average about 3.8-4.0 per cent during 2014-15.

The IMF's classification of emerging and developing European countries comprises some Balkan countries (Romania, Bulgaria, Serbia, Croatia) but also Turkey, Poland, Hungary and Lithuania.