SIMILAR ARTICLES

70% of economic growth in first three quarters of 2018, obtained by stocks increase. Foreign exchanges pulled down GDP by 1.6 percentage points

INS recalculated GDP in the third quarter and the first three quarters of the year. Here are the growth data for the Romanian economy, updated… Mai mult

Romanian Leu of 2019: Depreciation rate depends on budget credibility and seriousness

The estimates by economists of most important banks in Romania on the depreciation of the local currency for this year range between 4.73 and 4.77… Mai mult

Romania and energy: Position in European context

Final energy consumption of Romanian industry declined by about 75% between 1990 and 2016, compared to only 25% at the EU level, according to data… Mai mult

Crash signal in foreign trade – export coverage ratio has fallen to 2011 level. And we do not import robots

The trade deficit on November 2018 was EUR 1.567 billion, the second worst monthly performance registered last year. Worryingly, the growth rate of exports compared… Mai mult

Intense M&A activity in 2018 in Romania – Deloitte analysis

The Romanian mergers and acquisitions market reached nearly EUR 2 billion in 2018, according to a Deloitte Romania analysis based on public sources and transactions… Mai mult

Cronicile

Brief picture of economy. 2018 GDP growth after first nine months: 4.2%

de Marin Pana , 10.12.2018

The economic growth on the first three quarters of 2018 was 4.2%, both in gross series and the seasonally adjusted series, according to data published by the INS in the first provisional version, which confirms the signal data.

Beyond an evolution below the initial expectation of 5.5%, we can see a slight decline in the GDP growth in the third quarter, although, paradoxically, we recorded the largest increase over the previous quarter.

The explanation is the unfavourable net effect, as we saw a record GDP growth of 8.8% in the reference quarter, Q3 2017, compared to Q3 2016.

*

  • Quarterly GDP in first nine months of 2017 (seasonally adjusted data)
  • Period              Q1       Q2       Q3       nine months 2018
  • GDP
  • % compared to the same period of 2017

*

Unfortunately, the same base effect less favourable than in the first half of the year will also occur in the last quarter, which makes it difficult to reach the level of 4.5% considered as the revised 2018 GDP growth (a result of 5.3% on Q4 2018 would be needed).

*

  • Evolution of quarterly GDP compared to the previous quarter (%, seasonally adjusted series)
  • Quarter
  • Evolution of quarterly GDP compared to the corresponding period of the previous year
  • Quarter

*

By category of resources, manufacturing industry contributed the most to GDP formation in the first nine months of 2018, with 23.6% of the total and 1.1 percentage points of the gross growth of 4.2%.

Substantial proportions were contributed by agriculture (a 5.5% contribution to GDP but a surprisingly good 0.6pp contribution to the economic growth, which shows the relatively good agricultural year) and trade (a 18.4% contribution to the 9-month GDP formation and also a 0.6pp effect on GDP, but attention, down to only 15.8% on Q3 2018)

Substantial contributions were brought by professional, scientific and technical activities (6.6% in 9 months, with an increased rhythm to 7.2% in Q3 2018) and the IT&C sector (5.3%, but with a loss in speed to +4.8% in Q3 2018), both with a contribution of 0.3 percentage points of the GDP growth of 4.2 percentage points.

Real estate transactions and public administration, education, health, defence, etc. also added 0.2 percentage points to the economic result, domains where the calculation methodology is mainly related to the salaries paid in order to assess the gross value added in the economy.

It is noteworthy the zero effect of a key sector, the financial intermediation and insurance industry, as well as the only negative value in this picture, from the construction sector (-0.2% in 9 months and a worrying -0.4% in Q3 2018).

A brief picture of Romanian economy’s achievements

We present below the brief picture of Romanian economy’s achievements, where the advance is robust in terms of volume but a little too high in terms of prices (+ 6.8% on the total gross value added), which significantly reduces the nominal value of the amounts accounted for the volume advancement. Hence the direct cause of GDP growth in real terms below those initially projected.

We can see that the domains with the best performance were agriculture and IT (which also recorded the lowest price increase index, except for real estate transactions) followed by professional and industrial activities.

On the opposite side, besides the relatively weak or even negative evolution in volumes, public administration, education, health, etc. and constructions also registered very high price indices that affected the overall economic outcome. The same thing, to a slightly lesser extent, can also be said about the financial intermediation and insurance sector, otherwise on a rise marked by profitability.

*

  • GDP by resource categories in the first three quarters of 2018 – gross series
  • Sector             Results            Volume evolution        Price change
  • Manufacturing
  • Trade, transport, auto repairs, hotels, etc.
  • Public administration, education, health, etc.
  • Real estate transactions
  • Professional activities, support activities, etc.
  • IT&C
  • Agriculture, forestry, fishery
  • Construction
  • Financial intermediations and insurance
  • Entertainment, home repairs, other services
  • Gross added value
  • Net taxes on products
  • GDP

*

It should be emphasised the double-digit increase in net taxes, although prices have advanced here with only a little more than one percentage points. They reached thus a share in the structure of GDP growth a little bit higher than the practice. Structured after the first nine months of the year on a ratio of only 76% gross value added (3.2pp) to 24% net taxes (1pp), in order to result in the GDP growth of 4.3%.

Last, but not least, the negative balance between exports and imports of goods and services should be emphasized. A balance that increased to over RON 17 billion (exports of RON 292.2 billion and imports of RON 309.5 billion). Not only did the growth rate of exports (+ 5.9%) fall below imports (+ 9.1%), but also the price index was higher, +4.8% in exports and +4.1% in imports.

The result of this mix: an effect of -1.5 percentage points on GDP growth. In other words, we would have achieved the planned economic growth plan if we had had the capacity to cover an increased domestic demand and the competitiveness with our main foreign trade partners which to reduce, not increase the foreign deficit.

Mergeți în homepage ›

Publicat la data de 10.12.2018

Lăsați un comentariu


NEWS

Mugur Isarescu: "Ordinance weird thing" reduces monetary policy efficiency, which will not help Government

The National Bank of Romania (BNR) will convoke the National Committee for Macro-prudential Supervision, where the Ministry of Finance will be required to clarify the… Mai mult

World Bank lowered prospects on Romania's economic growth for 2019 and 2020

  Romania's economy will record an advance of 3.5% in 2019 and 3.1% in 2020, down one percentage point from June 2018 forecast, according to… Mai mult

State is borrowing at increasingly higher costs - government bond yield reached 5.33% per year

The benchmark government bond yield jumped above the 5% threshold on Thursday. The Ministry of Public Finance (MFP) attracted RON 300 million from banks on… Mai mult

Iasi - Tg.Mures highway disappeared from Large Infrastructure Operational Programme 2021-2027

The Ministry of European Funds has taken out Iasi-Tg. Mures highway project from the Large Infrastructure Operational Programme 2021-2027 and the Ministry of Transport already… Mai mult

Senate postpones discussions on DNA’s request on waiving immunity of Calin Popescu Tariceanu until February 2019

The Senate has decided that it will put to the vote the decision to waive Calin Popescu Tariceanu's immunity only in the spring session, that… Mai mult

Implementation of 5G technology, a multiplication effect in economy of EUR 4.7 billion - announces Sorin Grindeanu (ANCOM)

The National Authority for Management and Regulation in Communications (ANCOM) launched on Wednesday the National Strategy for the Implementation of 5G Technologies in Romania for… Mai mult

FIC: Amendments on Criminal Codes expose business environment to abuses from civil servants

Some of the amendments to the criminal codes will generate mistrust regarding Romanian state's ability to ensure the legality, stability and predictability of business relationships… Mai mult

European Semester / European Commission asks Romania to correct its medium-term structural deficit by 1% of GDP

Minister Eugen Teodorovici is pressured by the EU to reduce the budget deficit After finding that the Government has done nothing to adjust the deviation… Mai mult

Sovereign Fund gets legal base. Details announced by Minister Teodorovici

The Government adopted on Thursday the ordinance that provides for the general framework for the establishment of a Sovereign Fund. Later, after new talks with… Mai mult

Ford is looking for 1,700 employees to produce EcoSport SUV model

The representatives of Ford Craiova met on Wednesday with mayors of 30 localities from Dolj county in order to stimulate the attraction of 1,700 new… Mai mult

Development strategy / Government squeezes even investment money from its own companies: EUR 120 million from only two entities in energy field

Nuclearelectrica (SNN) and Romgaz (SNG) have calculated the additional dividends to be paid to the state after the Ministry of Finance (MFP) sent to the… Mai mult

DNA, officially: Senate President is suspected of having received a USD 800,000 bribe. Case file opened at a request from Austrian judicial authorities

The case file in which the DNA requested the waiving of the Senate President’s immunity was opened at the request of Austrian judicial authorities and… Mai mult

Illegal state aid / European Commission demands Romania to recover EUR 60 million from CE Hunedoara

Romania has to recover illegal state aid worth EUR 60 million granted to Compexul Energetic Hunedoara, announced the European Commission with a statement released on… Mai mult

Ministry of Finance planned loans of RON 4.74 billion in November. Costs are increasing

The Ministry of Public Finance (MFP) intends to borrow in November RON 4.74 billion, 1.4% more than in the previous month, according to the Ministry.… Mai mult