January 25 (SeeNews) - Romanian finance ministry analysts on Wednesday raised their forecast for the country's 2017 economic growth to 5.2% from 4.3% based on expectations of a more robust performance across sectors than originally projected.
The National Prognosis Commission (CNP), an analyst unit within the finance ministry, said in a statement that Romania's gross domestic product (GDP) would total 815.2 billion lei ($194.6 billion/181.2 billion euro) in 2017. This compares to an estimated 738.5 billion lei in 2016, up by 4.8%.
Economic growth in 2017 will be backed by a more rapid increase - by 6.7% - in final household consumption, CNP said, revising its September forecast for a 5% rise. For 2016, CNP estimated an increase of 8.1% of final household consumption.
Final household consumption rose 6.1% on the year and dropped by 1.3% on the quarter during the third quarter of 2016, according to the latest data available from the country's statistics office, INS.
The CNP also expects agriculture to grow by 1.9%, services by 5.2%, construction by 6% and industry by 6% in 2017. These figures compare with September forecasts of 9.4% advance in agriculture output, 5.8% rise in services, 5.7% growth in construction and 2.4% growth in industry.
Exports of goods and services are expected to grow by 5.6% in 2017, while imports are seen increasing by 8.5% in 2017, according to the latest CNP projections.
Trade balance for 2017 is expected to show a deficit of 11.55 billion euro ($12.4 billion), the CNP said.
Romania's trade gap widened to 8.77 billion euro in the eleven months through November, from 7.19 billion euro in the same period last year, INS said earlier. Exports rose by 4.8% on the year to 53 billion euro, while imports increased by 6.9% to 61.8 billion euro in the eleven-month period.
Regarding unemployment rate, CNP expects that it will edge down to 4.3% in 2017 from an estimated 4.8% in 2016.
Romania's unemployment rate slightly decreased to 5.7% in November, from 5.8% in October, INS data showed.
CNP said in the statement it raised its economic growth forecasts for the next three years compared to its September projection, and nor expects 5.5% growth for 2018, and 5.7% for 2019 and for 2020 each.
The figures largely comply with the 2017 budget draft, which is based on projections for 5.2% economic growth and envisages a deficit of 2.99% of GDP under the European System of Accounts (ESA) standards. According to the document, GDP this year is estimated at 815.1 billion lei.
The budget is expected to be voted in parliament next week. It should then be endorsed by president Klaus Iohannis.
On Saturday, Fitch Ratings affirmed Romania's long-term foreign and local currency issuer default ratings (IDR) at 'BBB-', with stable outlooks. Fitch said that Romania's ratings are constrained by fiscal uncertainties that stem from continued pro-cyclical fiscal loosening.
At the beginning of January, the World Bank projected that Romania's economy will expand in 2017 and 2018 at 3.7% and 3.4%, respectively, according to the report published on its website.
(1 euro =4.4973 Romanian lei)