In its latest estimation of Romania’s economy, IMF predicts a growth of 7%. It’s a slight improvement compared to the IMF’s estimation in April when the specialists predicted a 6% increase.
At the same time, the IMF warns that this growth is obtained based on domestic demand, which is a liability in itself. On one hand, the growth based on domestic demand is clearly not a sustainable one. On the other hand, an increase in domestic demand fuels inflation in the short term. That adds up to the existing 5% inflation in Romania.
The National Bank of Romania also warned the Government about the growing inflation figure and also mentioned that the economic growth the Government is boasting is based exclusively on domestic demand. The NBR’s economists expect inflation to grow even more in Romania in these conditions.
Funny enough, in a logic-defying interview, the Romanian Minister of Finance questioned the inflation rate and said it is not 5%, though all the official figures lead to this conclusion. The same minister, named recently as the head of Romanian Finance, proved not to know the minimum wage in Romania, while Prime Minister Florin Citu mentioned he didn’t know the price of a piece of bread as he mentioned he tried not to eat this kind of product.
In this context, with galloping inflation and with gas and energy prices skyrocketing in Romania, chances are the economic growth to get unnoticed by the citizens. And, if the economic growth is not making the citizens live a better life, all this is mere statistics.