Romania reports surprising economic growth
Romania's economic growth in the second quarter of the year pleasantly surprised experts.
Ştefan Stoica, 18.08.2022, 14:00
Romanias economy grew by 5.8% in the first semester of this year, compared to the same period of 2021, the National Institute of Statistics announced, thus taking experts by surprise. At the same time, in the second quarter, the Gross Domestic Product recorded an appreciation of 2.1% compared to the previous quarter. Finally, compared to the same quarter of 2021, the GDP increased in the same period of 2022 by 5.3%. The good news was also confirmed in Brussels: Romania recorded, among the EU member states for which data are available, the second most significant economic growth in the second quarter of 2022, as compared to the previous three months, of 2.1 %.
Only the Netherlands, whose growth was in the same range, had a bigger growth rate of 2.6%. Economic growth was also registered in Sweden, Spain, Hungary and Bulgaria, while decreases in the economic growth rates were recorded in Poland, Latvia, Lithuania and Portugal. As compared to the second quarter of last year, the GDP increased by 3.9% in the euro zone and by 4% in the European Union between April and June 2022, with all EU member states for which data are available reporting increases. Eurostat confirms, in the case of Romania, the annual growth rate of 5.3% in the second quarter of 2022, after an annual growth of 6.4% in the first three months.
The economy grew steadily in the second quarter, despite pessimistic expectations, Ziarul Financiar reports, noting, however, that, lately, economists have shown that they like being taken by surprise. Institutions that conduct economic analyzes have increased the growth forecasts for the Romanian economy in recent months. For instance, the European Commission, in the summer forecast, had increased the estimate for the entire year 2022 from 2.6 to 3.9 %, thanks to the solid growth in the first quarter, the previously quoted publication writes. The biggest surprise is the 2.1% growth in the second quarter, according to analysts. “With everything that is happening around us, it is an exceptional result”, economist Aurelian Dochia told Ziarul Financiar.
“It is a very big surprise for us too, but the surprise is even bigger for the market”, says Ionuţ Dumitru, the chief economist of an important private bank. Industry, which accounts for 20 % of GDP, is reporting loss in mid 2022, the constructions sector is barely moving, agriculture, due to the drought, will have a negative contribution to the GDP, and household consumption has increased by a little over 3%. So, what is the explanation for growth? Ziarul Financiar asks. Economist Laurian Lungu believes that the main effect comes from the price index and, partially, from investments. The important thing is what will happen in the second part of the year, Laurian Lungu thinks. He estimates that the economy has not entered a period of contraction, though, even if people received employment contracts, wage increases are below the level of inflation, which has reached almost 15%, and will affect consumption. (LS)
