Eurostatistics is a synthesis based on a set of standardized and harmonized benchmarks for the comparability between countries at the European level (Principal European Economic… Mai mult›
Romania climbed last year on the penultimate position among the EU member states in terms of the productivity of resources in the economy, after Bulgaria,… Mai mult›
Romania’s economy is becoming more and more vulnerable due to the increasing number of businesses that state no revenues, register losses and debts exceeding their… Mai mult›
Hourly labour cost increased by 15.6% in the second quarter of 2018 compared to the same period of 2017 (+ 9.36%, compared to Q1 2018),… Mai mult›
Fiscal Council, about budget amendment: Increase in revenues from VAT and excise duties has no basis
The Fiscal Council announced on Wednesday, the day when the Government adopted the draft budget amendment without the opinion from CSAT, that it considers the… Mai mult›
de Marin Pana , 6.11.2017
In the autumn forecast on which the 2018 budget is based, the National Commission for Prognosis, an institution under the Government’s authority, increased the economic growth projection for the current year to 6.1%, from the level of 5.6% announced only a few weeks ago in the preliminary autumn forecast.
The value used as a benchmark for the 2017 GDP (including for the general budget deficit, which threatens to exceed 3%), went up again. Started from RON 815.2 billion at the beginning of the year, it reached along the way (somewhere after the summer vacation) RON 837.1 billion and now it is mentioned the level of RON 842.5 billion.
- Version Q1
- Version Q2
Not only the GDP result for the current year has been re-evaluated upwards by 0.65% but also all values until 2021. To be mentioned, all the values projected for the euro/ leu average annual exchange rate have been maintained, decreasing from 4.56 lei/euro for the current year to 4.50 lei in 2021 (?).
A warning signal for those who closely follow the data of the national economy, the annual GDP values for the interval until 2021, expressed in billions of euros, have been removed from the usual form of the table presented by CNP. From the values related to GDP/inhabitant, only those in RON remained while those expressed in EUR/inhabitant have disappeared.
Explanation is sublime
The CNP’s explanation for the spectacular and so far, one-time increase of the GDP growth estimate by half a percentage point in just a few weeks could only be found at the level of a radical change in the gross value added in the economy. Let’s see what the re-evaluation of the development pace in the main economic sectors indicates:
- Increase of 2017 gross value added in the economy Q1 Q2 change
As the growth rate of the other component of GDP, net taxes on the product stagnated at + 4.2%, it results that the increase in the economic growth estimate appeared after the industry (the main engine of the Romanian economy) and agriculture have been re-evaluated significantly downward and services have changed their growth up by only a tenth of a percent.
The only plausible explanation (which should also cover the declines in the industry and agriculture!) comes from the construction sector, where the change from 1.5% to 7% within a few weeks appears to be quite bizarre. The correct recording of the production obtained and, particularly, of the intermediary consumption based on which it has been obtained, should be carefully monitored.
Change trick – 6.4% growth in second semester of 2017!
Without the need for in-depth knowledge of mathematics, let us simplify the situation at this point in relation to GDP developments in the second half of the year. For the first part of the year, we already have the seasonally adjusted value published by INS at the level of + 5.8%.
From the preliminary version, we knew that there would be a slight growth slowdown to only + 5.4% in the second half of the year, from which a perfectly plausible and otherwise very good 5.6% level for the entire 2017 would have resulted.
Now we have found ourselves with an AVERAGE OF 6.1% FOR THE WHOLE 2017. What does that mean? Well, like in the elementary school, it means that we need not just + 5.4% in the second half of the year to obtain the average level, but + 6.4%! That is, not some slowdown in growth but rather a strong acceleration, with a new record at the European level in the field.For this purpose, the GDP deflator, which measures the prices in the economy and by which nominal GDP values decrease then to make the transition to the base period prices, more accurately THE REAL ECONOMIC GROWTH, has been discreetly increased from 4.1% to 4.2%. And that even though inflation measured by the consumer price index has been re-evaluated upwards from 1.9% to 2.2% (and from 2.3% to 2.6% in 2018, when the deflator still appears at 2.1 !?).
Obviously, the situation created by these disruptions of indicators from which the forecasted GDP growth results resembles the jokes with Radio Erevan. That would be a good occasion for jokes about statistics if CNP data were not the basis for 2018 budgeting process. A year when we might not find ourselves in the mood for jokes anymore.
Lăsați un comentariu
Finance Ministry wants to change rules for insolvency: state could also register claims after procedure is launched
Companies’ possibility to avoid paying creditors (and in particular the payment of tax receivables) simply by declaring their insolvency would be drastically limited, according to… Mai mult›
Prime Minister Viorica Dancila, European Commissioner Phil Hogan and Agriculture Minister Petre Daea The swine fever epidemics in Romania has an impact on neighbouring countries,… Mai mult›
Infrastructure projects lost EUR 41.5 million following budget amendment. In what projects cuts have been made
Despite the assurances that Dancila government is concerned and intensely working on the road infrastructure projects, at the budget amendment the Transport Ministry has cut… Mai mult›
Leaders of the political groups in the European Parliament have decided to adopt in October a resolution on the rule of law in Romania. The… Mai mult›
"Romania's buffers have deteriorated, the country is less prepared for a negative shock" - IMF will reduce economic growth estimate
Romania will be less prepared if the economy is hit by a negative shock, as the structural deficit has been deteriorated - IMF representative for… Mai mult›
Premiere: CSAT asks Finance Ministry to amend amendment - session suspended until Government comes with a draft that does not affect budgets of secret services
President Klaus Iohannis suspended on Tuesday the CSAT meeting for discussing the budget amendment, as there was no consensus on the budgets of institutions from… Mai mult›
Rating agency Standard & Poor's confirmed on Friday ratings for long- and short-term debt in foreign and local currency to "BBB-/A-3" with a stable outlook,… Mai mult›
"Romania’s presidency seems to fail before it starts": Gunther Krichbaum - reaction to anti-German violent statements made by government officials
Romania's presidency of the Council of the European Union seems to fail even before it starts, warns Chairman of the Bundestag European Affairs Committee Gunther… Mai mult›
OMV Petrom sells a quarter of its deposit perimeters to finance potential gas extraction from Black Sea
OMV Petrom (SNP) will sell another 50-60 perimeters from its portfolio of about 200, as most of the company's investments focus on operating the Black… Mai mult›
The number of people who left the country for more than 12 months continued to grow last year, reaching almost 220,000 people (which exceeds the… Mai mult›
The Minister of Justice stirred up the fury of magistrates. 181 prosecutors and judges sent him a letter criticizing Tudorel Toader for his statements about… Mai mult›
MApN announced on Wednesday that Mihail Kogalniceanu Air Base 57 had a ceremony occasioned by the handing over of the Enhanced Air Policing between the… Mai mult›
The Ministry of Public Finance makes a "comparative analysis" of the Tax Code and the Tax Procedure Code with a view to applying a new… Mai mult›
Romania, Hungary and Slovenia are the member states that recorded the largest increase in the share of public sector employees in the total number of… Mai mult›