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Minister of Finance Adrian Caciu said on Thursday that he maintains his forecast that this year's nominal GDP will be at least at the level at which the budget was built and considers that the 4 percent target can be reached this year, if the calendar is respected.
The draft budget for 2022 was set at an economic growth of 4.6 percent.
"Economic growth is the real growth from which the deflator is reduced or simply said, domestic inflation. I maintain my forecast that this year's nominal GDP will be at least at the level at which we built the budget, and the real growth is calculated based on how much inflation you have in this nominal growth. At this point, I don't want to mention figures any more, so as not to be somewhat contradicted by the institutions, I think we can reach 4 percent this year if we stick to the calendar. We need to understand that you do not cut back from the financing of the economy just because you have certain indicators that you need to look at from an accounting perspective. I noticed this during the pandemic and I think that now some of the elements that we settle from the perspective of the way in which we have to stimulate the economy are also the bill for delaying some of the measures back then," the Minister of Finance stated at the end of the Government meeting.
According to Adrian Caciu, if the economy is not allowed to grow this year, problems such as a decrease in purchasing power or even bankruptcy will arise.
On the other hand, he showed that the current debt will be below 50 percent of GDP based on the current forecasts.
"If we don't allow the economy to grow this year, then we will have a cascading problem, public debt relative to a lower GDP, declining purchasing power, bankruptcy in society, and then we are not in that situation because we are coming with very important stimuli in the economy. We are somewhere at 4.7 percent, the moment we conclude the Support for Romania package with what has been brought, the 4.7 percent of GDP is given somewhat in the first part of the year to the economy and to society. I don't worry at the moment, we have to see how the first quarter closes, and there are no more external shocks that will make us readjust, but if necessary we will readjust, to have a public debt other than the one which we have assumed in the Law on Ceilings: 49.8 percent of GDP," the head of Finance also said.
The International Monetary Fund (IMF) has significantly revised its estimates for the growth of the Romanian economy this year, from 4.8 percent as it estimated in autumn to 2.2 percent, shows the latest report "World Economic Outlook", published on Tuesday by the international financial institution.
According to the new IMF forecasts, the Romanian economy will slow down from an advance of 5.9 percent in 2021 to 2.2 percent in 2022, and next year it will accelerate to 3.4 percent.
For Romania, the new revised IMF figures are slightly more optimistic than the World Bank's forecast, which in early April predicted that the economy would make a modest advance of 1.9 percent this year and the risks from the crisis in Ukraine are high.
Moreover, the European Commission estimates in the forecasts published on February 10, 2022 that the Romanian economy will slow down to 4.2 percent this year, so that in 2023 it will advance slightly to 4.5 percent.
