Romanian state forecasting body to revise downwards its 2020 GDP projection

Romania’s National Strategy and Prognosis Commission (CNSP) estimates that the local economy could contract by 4% this year. This would require that the economic activity restarts in July-August, CNSP president Nicolae Cristian Stanica told Adevarul daily in an interview.

Romania's economy has entered the coronavirus crisis with very good potential, which explains CNSP’s optimistic forecast issued in April. Still, the longer it takes to restart the economy, the higher the decline in the gross domestic product, Stanica argued.

CNSP’s latest forecast issued in April envisages a milder GDP decline of only -1.9%.

The CNSP's expectations on the evolution of other indicators this year are optimistic as well: unemployment (4.4% in 2020, under ILO definition), exchange rate (RON 4.8 to EUR), and wages (+2.8% in real terms). The Government drafted the revised budget planning for this year based on such assumptions.

The short-term (monthly) data, used by CNSP for preparing the forecast, were available only for February, Stanica explained. However, he said the Commission would adjust the forecast, given that the only area considered to be growing under its April forecast, agriculture, is currently affected by the drought.

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