The International Monetary Fund Estimates Romania’s Economy Will Contract by 5% in 2020

Romania’s economy could contract with 5% of GDP this year, according to the new forecast of the International Monetary Fund (IMF), published on Tuesday.

The IMF’s new estimates are much more pessimistic than the World Bank’s, which last week forecast that Romania will see a growth of 0.3% in 2020, compared to an advance of 3.8% as estimated three months ago. The World Bank is also counting on a return to 4.4% in 2021.

At the same time, the IMF also revised its estimates of the current account deficit registered by Romania this year, up to 5.5% of GDP, given that in the autumn it forecast a current account deficit of 5.2% of GDP. The current account deficit level will decrease slightly to 4.7% in 2021.

The Minister of Economy, Virgil Popescu, said that the Romanian economy has a contraction of between 30 and 40%, given that the peak of the coronavirus epidemic has not yet been reached, also indicating that the most affected areas are tourism, HoReCa, transport and auto industry.