Romania’s economy grows on investments now, compared to private consumption, as it happened in the past. This is the opinion of Cristian Popa, Romania’s National Bank board member. Invited to ZF Live, the most prestigious financial newspaper in Romania, Cristian Popa brought the news and compared the economy now with what it was years ago.
The economic growth we see is now based on investments and European funds. There are no more chances for it to rely on increased consumption. The growth pattern seems to be changing. The only economic growth factor that does not create inflation is these investments financed from European funds. However, foreign direct investments also represent a source of sustainable growth, perhaps even more sustainable than that of European funds.
Cristian Popa for ZF Live
Also, for 2023, the BNR expected a deceleration of inflation, more precisely, to more than a halving of the rate, which happened during this year.
We saw a rapid drop in inflation. The downbeat monthly rhythm is also a novelty, totally atypical for the last 2-3 years, but this evolution is also in line with the NBR forecasts. What should be noted is the decrease in the annual inflation rate to 9.1%, supported by more comprehensive decreases in the food component and non-food goods.
Cristian Popa
Cristian Popa states that instead, there was a slight monthly increase in the level of services, which is related to the evolution of the labour market, which remains tense.
However, the specialist warned about the potential drastic effect of the fiscal measures taken by the government at the beginning of 2024 but also said he didn’t think there would be a recession, despite what some experts expected.
Things are dynamic. We still see economic growth figures despite a significant slowdown. We do not expect a recession. We didn’t see her this year, and we won’t see her next year either
Cristian Popa on recession
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