The economic year 2016 was more favorable than 2015. After the recession of 2015 (- 0.5%), the GDP this year is expected to grow by about 3% owing to the evolution of two sectors. The agricultural sector witnessed a compensatory growth following the drought of 2015, while the service sector recovered owing to a modest rise in final consumption, stated the independent think tank “Expert-Grup”, quoted by IPN.

The independent experts anticipate that the same high level of uncertainty about the macroeconomic developments will persist next year as the sources that propelled the economy in 2016 are not sustainable. However, a recovery is possible in the industrial sector and this will lead to a rise in exports and a slight growth in investment activity amid the relaxation of the monetary policy and political stabilization (post-electoral effect). The economic growth forecast for 2017 is of 4-5%.

“Expert-Grup” notes that despite the economic growth expected in 2016-2017, its quality will be worse. Alongside competitiveness-related shortcomings, the quality of economic growth is affected by at least three factors. First of all, labor productivity continues to decline. Together with the increase in real salaries, this undermines the capacity of producers to compete on the internal and external markets. Secondly, a large part of the growth in consumption, which became again the main economic growth stimulus, is due to the consumption of goods and services generated inside households. Thirdly, investments in fixed capital remained low in 2016 and are not projected to grow substantially in 2017 either.

For the next about five years, “Expert – Grup” anticipates an economic growth of about 3-4% (+/- 1 percentage points). But a twice faster growth is needed to ensure convergence with the indicators in Central and Eastern Europe in due time.