Nazare: European Commission's forecast confirms that Romania is on right track

The European Commission's summer 2021 economic forecast confirms that Romania is on the right track, but the materialization of growth estimates depends on maintaining balance and prudence in relation to public spending and on capitalizing on European funds, says Minister of Finance Alexandru Nazare. "The European Commission's summer forecast has been published and brings new good news for our country. The European Commission has significantly revised its economic growth forecast for Romania in 2021 to 7.4%. This estimate is 2.3 percentage points higher compared to the spring forecast, of 5.1%, and places Romania in the first place in the European Union, followed by Ireland, with 7.2%. At the same time, the European Commission's estimates show an economic growth of 4.9% for our country in 2022. These forecasts confirm that Romania is on the right track, but their materialization depends on maintaining a balanced attitude and prudence in relation to public spending, but also on capitalizing on the European funds available. Hence, the fiscal budgetary adjustment assumed by Romania still entails sustained efforts of fiscal consolidation," Nazare wrote, on Wednesday, on his Facebook page. He reiterated the requests addressed to the authorizing officers during the Government meetings to use the European funds with maximum efficiency and to identify opportunities to make savings. "The positive adjustment of the economic growth estimates does not justify requests for additional expenditures," the minister pointed out. Romania's economy will grow by 7.4% in 2021 and by 4.9% in 2022, after an advance of 5.1% this year, as estimated in May, and of 4.9% next year, according to the Summer 2021 interim Economic Forecast, published on Wednesday by the European Commission (EC). The performance of the Romanian economy was solid in the first quarter of 2021. GDP grew at a quarterly rate of 2.8%, supported mainly by private consumption and investment. Conversely, net exports were significantly negative, reflecting weak external demand and supply chain disruptions, according to the EU executive. Romania's economy is expected to grow by 7.4% in 2021 and 4.9% in 2022, a higher level than the one estimated in spring, due to stronger-than-expected GDP performance in the first quarter of 2021, reported the European Commission. The confidence of consumers and business people has remained strong so far. Private consumption is expected to remain extremely robust, supported by the lifting of restrictions, especially in sectors severely affected by the pandemic, such as the performing arts, entertainment, restaurants and hotels, and by relatively strong wage growth in the first months of the year, predicts the EC. Investments will remain sound in the period 2021-2022, supported by both the public and private sectors. The continuous increase in orders suggests that industrial activity will expand in the coming months. Exports are expected to improve in line with the recovery of Romania's main trading partners, but the contribution of net exports to growth would remain negative in the period 2021-2022, the EC warns. The advance of the Romanian economy will continue in 2022, although at a slower pace. AGERPRES (RO - author: Nicoleta Gherasi, editor: Mariana Nica; EN - author: Simona Iacob, editor: Razavan-Adrian Pandea)

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