May 26 (SeeNews) - Romania's economic output is expected to shrink by 14.4% year-on-year in the second quarter of 2020 before returning to growth of 1% in the third quarter and 3% in the fourth, the finance minister said.
"We expect a severe reduction in economic activity in the second quarter (-14.4%), as the quarterly profile shows a predominantly V-shaped curve, (...) with a proper recovery in the fourth quarter," the finance ministry said in its 2020 convergence programme published on Monday.
Activity in the manufacturing industry is estimated to drop by an annual 18% during March-May. Also, during the peak period of the pandemic, services will have a negative contribution of 9.3% points to the GDP dynamics, followed by industry with a minus of 3.9%, according to the document.
In the programme, the ministry affirmed its forecast for a 1.9% contraction of the national economy in 2020 which it made in mid-April.
According to the convergence programme, the contraction is due to a 1.6% annual drop in domestic demand and a 0.3% drop in exports. Prior to the coronavirus outbreak, the finance ministry predicted economic growth of 4.1% in 2020.
Romania's GDP growth decelerated to 2.4% year-on-year in the first quarter of 2020, compared to a 5% annual increase in the like quarter of 2019, the country's statistical board, INS, has said in its latest non-adjusted flash estimate.
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