Banca Transilvania, optimistic about Romania’s GDP growth

Local lender Banca Transilvania (BT) estimates that Romania will record an economic increase of 5% this year, significantly above the estimates of international institutions. The budget deficit will amount to only 2.3% of the GDP, below the level included in the state budget project, of 2.95% of the GDP, according to BT. The Government, the European Commission, and the International Monetary Fund expect an economic increase of 4.2% for Romania in 2016. However, this year’s economic growth could represent a peak of the post-crisis economic cycle if the structural reforms fail to intensify, reads the BT report. The GDP growth will decelerate to 4.6% in 2017, respectively 4.1% in 2018, according to the lender’s estimates. The growth would temper down due to the waning of the tax-budget stimulation measures and the perspectives of a new monetary cycle. BT analysts expect a budget deficit of 1.5% of the GDP in 2017 and 1% in 2018, unlike most economists who warn that the deficit could exceed 3% of the GDP if all the measures proposed by the Fiscal Code for 2017 are applied. editor@romania-insider.com