Statistics: Romania's 2012 third quarter economic results not as poor as initially estimated

The National Statistics Institute (INS) recently released its revised provisional results concerning Romania’s economic state in 2012, which show that the country’s GDP for last year’s third quarter stood slightly higher than initially estimated. The predicted regress of the economy in the last three months of 2012 was 0.1 percent less serious than the actual recorded level.

The revised estimated GDP stands at approximately EUR 34. 2 billion (RON 153.8 billion), as determined based on current prices. This marks a 0.4 percent decrease, in real terms,quarter-on-quarter, and a 0.6 percent drop year-on-year. Last December, the INS announced that the economy had taken a downward turn with the third quarter estimates for 2012 standing 0.5 percent below the second quarter results. The GDP was estimated then at EUR 34 billion (RON 153 billion), approximately EUR 0.2 billion (RON 759 million) below the newly released revised figures. The updated figures also reflect a slightly better state of the economy at the end of last year. Thus, the initial 0.6 percent decrease for the third quarter of 2012 as compared to the official figures released in the previous year was brought down by 0.1 percent. The new INS release on the state of the economy over the first nine months of 2012 maintained the 0.2 percent economic decline level, but the initial provisional GDP of EUR 92.75 billion (RON 417.4 billion) was adjusted to EUR 92.51 billion (RON 416.3 billion). PM Victor Ponta fired the President of the INS, Vergil Voineagu, on January 4, 2013 due to a “serious fault” in the initial calculation of the GDP for 2011. The GDP level announced at the time was EUR 4.4 billion (RON 20 billion) lower than the initial estimate, which would have required a EUR 0.2 billion (RON 1 billion) cut down in budget expenses for 2013 so that the set deficit target was maintained. Ponta placed this in a long series of similar incidents that have caused the operation of state institutions to be blocked for some years now. “No one will forgive us if we remain stuck in a situation caused by years of bureaucracy and lack of institutions’ ability to function,” stated PM Ponta at the time. “We found now, at the beginning of the year, that the INS and the National Forecast Commission have made a mistake. While from 2003 to 2010 they overestimated the GDP […] in 2011 they underestimated it. I don’t necessarily think that this was intentional, but it remains a serious mistake.” The INS responded by specifying that it applied the EU methodology for GDP calculations which requires that three forecast versions should be sent over a period of 21 months. The INS representatives said that it is only natural for differences to appear between versions and that these should not be construed as miscalculations. Ioana Jelea,