World Bank: Romania's economy will shrink by 4% in 2009

The World Bank forecasts a 4% economic decrease for Romania in 2009. For the next year, the estimates show 0.5% increase in GDP, whereas for 2011, the GDP is expected to increase by 2.5%, Romanian news agency Mediafax informs.

„Global Development Finance 2009” report goes on to underline the current account deficit, which is estimated to reach 8.4% of the GDP, against 12.4% of the GDP, its value for the last year. The figure is expected to drop to 7.5% in 2010, only to see it increasing again in 2011 to 8.7%.

Regarding the Central and Eastern European economies, the World Bank expects to see a 1.6% economic shrinkage in the region in 2009, followed by GDP stagnation in the course of the following year.

Among the most important risks in the region, the World Bank indicates foreign capital flux crash for all emergent economies, serious economic activity deterioration and a big reduction in demand, both for exports and for imports.

The World Bank has now a different forecast that it had in February, when it saw the Romanian economy increasing by 0 to 2%. The „Global Economic Perspective in 2009” report presented in December 2008 predicted a 3.2% economic growth in Romania.

The International Monetary Fund (IMF) anticipates a similar 4.1% Romanian economy decrease in 2009, while the European Commission forecasts a 4% reduction. Both institutions appreciate that Romanian economy will stagnate in 2010.