The economy in 2010: Growth could come from the West

“Romania cannot detach itself radically from evolutions in the region and in Europe, and this is why 2010 will be a year with a shy economic rebound, without major changes in the population’s perception on the country’s economic state,” said Mihai Tănăsescu, Romania’s representative at the International Monetary Fund (IMF). However, in spite of the economy’s gradual improvement, Tănăsescu said this will not be felt immediately by individuals. “The year 2010 will be marked by a slight rebound, which will not have an immediate impact on improving the quality of people’s lives, and unemployment will keep rising. At the same time, governments in the region will have to continue structural reforms, narrow fiscal deficits through massive cuts in public spending, or even tax hikes,” added Tănăsescu.

George Mucibabici, President of the Deloitte Romania audit and financial advisory company, said that there are signs indicating that the major economies - the United States, Germany, and France - are resuming growth, so Romania can expect a similar trend no later than the second half of 2010.

Mucibabici added that Romania’s handicaps can turn into advantages, such as underdeveloped sectors, which have a huge potential. “Paradoxically or not, for Romania the great handicaps are also the main advantages, because these represent potential for businesspeople and economic growth. The example closest at hand is, of course, infrastructure,” said Deloitte’s President.

Lucian Croitoru, Advisor to the Governor of the National Bank of Romania (BNR), sees encouraging signs in 2010, albeit not enough of them. “Nonperforming loans will continue to increase, and with them, the need for provisions. In order to meet this need, some banks will require new capital infusions,” warns Croitoru.