Romania’s real GDP increased by only 0.9% in 2024, which is a poor economic performance. This was:
➡️ substantially below the expectations of 3.2% prevailing at the start of 2024
➡️ the lowest economic advance in the last 10 years (pandemic year 2020 excluded)
➡️ substantially below the average annual growth rate of 3.3% from the last 10 years (2015-2024)
Households’ consumption did increase rapidly in 2024 (by 4.5%-5.0%) on the back of solid gains in real disposable income (wages, pensions), improving confidence, and decreasing interest rates. Public investments also increased rapidly in 2024 (by around 19% in nominal terms). Still, this was not enough to foster the expansion of domestic economic activity.
Real GDP dynamics in 2024 was depressed by:
➡️ a decrease in volume of exports of goods and services as a result of fragile external demand and of loss of competitiveness by some exporting sectors
➡️ a plunge in residential constructions and in dwellings completed
➡️ an increase in volume of imports to accommodate the solid gain in domestic demand (consumption, investments)
➡️ a contraction in agricultural output due to drought
➡️ a de-stocking process (puzzling although by its amplitude)
