The Ministry of Finance expects GDP gain of less than 1% in Q1

According to the same report, “the share of the economy not included in GDP rose from 14.5 percent in 2004 to 21 percent in 2008. Labor on the black market is the largest part of this economy, representing 50.8 percent in the first nine months of 2008.” Analysts expect labor on the black market to develop this year, due to the 3.3 percentage point increase in contributions to social security, considering companies have increasingly significant liquidity-related problems.

The MFP report states that the 2008 budgetary policy resulted also in a RON 16.4 bln rise in government public debt at the end of November 2008 compared to the end of 2007. Referring to the fiscal and budgetary policy for 2009, the Ministry of Finance estimates a real rise in GDP of below one percent in this year’s first quarter.

MFP’s estimates that the cost of anti-crisis measures will amount to RON 51.9 bln, of which RON 42.1 bln to relaunch economic growth, RON 8.77 bln for the financing of the economy, and RON 1.04 bln in social measures.