EBRD revises estimates of Romanian economy down to 1.6% in 2025
The European Bank for Reconstruction and Development, or EBRD, has revised its estimates regarding the evolution of the Romanian economy in 2025 downward to 1.6%.
The bank expects Romania’s GDP to grow 0.2% less than the 1.8% estimate made in February, and to increase by 2.4% in 2026.
Romania's GDP growth slowed to 0.8% in 2024, from 2.4% in 2023.
"While private consumption grew strongly on the back of real wage growth of 8%, it led to a significant widening of the trade deficit," the EBRD said in its report. "Investment decelerated significantly, especially in the last quarter, as EU funds absorption slowed. On the supply side, the slowdown was broad-based, with industry, services and construction experiencing notable decelerations, while agriculture was heavily affected by drought."
The international financial institution draws attention to the fact that “the fiscal position remains challenging and the planned fiscal consolidation this year will likely require additional measures due to the worse-than-expected outturn in 2024. Despite a slight moderation, inflation remains elevated at close to 5 per cent, necessitating a tight monetary policy by the central bank.”
According to the EBRD, Romania’s economy has limited exposure to the US economy but is significantly integrated into global supply chains in the automotive industry, which represents a vulnerability.
The EBRD is a major institutional investor in Romania and has so far invested nearly EUR 11.5 billion in 550 projects.
EBRD Chief Economist Beata Javorcik, present in Bucharest on February 5, told Romania Insider that the global and regional economic problems, such as high energy prices, economic slowdown in Germany and US tariffs, should create an imperative for change in Europe and Romania.
(Photo source: Jerome cid | Dreamstime.com)
