This report provides an assessment of Romania’s economy as described in the European Commission’s Annual Growth Survey published on 16 November 2016. In the survey the Commission calls on EU Member States to double their efforts on the three elements of the virtuous triangle of economic policy – boosting investment, pursuing structural reforms and ensuring responsible fiscal policies.
Some of the most important conclusion are:
Romania’s economy has been on an upward trend for the past two years. A post-crisis peak in terms of growth has been achieved in 2016 (at 4.9 %), strongly influenced by domestic demand on the back of procyclical fiscal policies. The rate of growing is estimated to lose some momentum, but remain elevated over the following years with a forecast for 4.4 % in 2017 and 3.7 % in 2018. However, the current account deficit deteriorated in 2016 and is estimated to deteriorate further driven by import growth due to strong domestic demand. Private consumption was at an elevated level as a result of wage hikes and indirect tax cuts. While private investment was supported by low interest rates and stable investor confidence, public investment declined in 2016 due to an unremarkable management of EU funding.