The Romanian economy will grow by 2 percent  this year, followed by a more accelerated growth of 4 percent in 2012, aided by growing exports, good reforms and a vital bailout program led by the International Monetary Fund and the EU, according to a report from JP Morgan Chase Bank.

"Export oriented industry has been successfully riding the global economic rebound (…). Once economic recovery finally arrives, it will provide a tailwind to the fiscal consolidation effort and will revive investor interest in the country, creating a virtuous spiral," the JP Morgan report writes.

The bank forecasts a one percentage point increase in exports to 29 percent of the gross domestic product in 2011, while imports are estimated to follow suit, reaching 34 percent of GDP. "The key to revival of domestic demand is a return of positive animal spirits in investment activity. We see a good chance of this happening this year, with the likely improvement in the labor market and the likely improvement in confidence more generally," the report noted.

JP Morgan said the Romanian budget deficit is likely to drop below 5 percent of GDP in 2011, from 6.5 percent of GDP a year earlier. For 2012, the bank estimates a budget gap of below 4 percent of GDP.

Mediafax