75% of 50 businesspeople and analysts interviewed by ZF expect economic growth in 2010

Most of the 50 analysts and businesspeople Ziarul Financiar interviewed on the progression of the economy in 2010 believe there will be economic growth, but there are also pessimists, seeing a decline by even as much as 5% as possible. ZF tried to determine how 2010 is seen by Romanian economy players in the context where the economy is now undergoing the most uncertain period and political instability is only worsening the situation.

Economic revival will depend both on the performance of euro zone economies, and on the moves the Government will make. And the risk of a prolonged recession is mainly related to political factors and the fiscal policy.

An ambitious fiscal consolidation programme, further monetary policy relaxation steps, political stability and the implementation of economic recovery steps are some of the suggestions persons questioned by ZF made to authorities to help the economy.

Businesspersons' concerns are related to a rising unemployment rate, the dwindling purchasing power of the population, declining investments and consumption and the skyrocketing non-performing loans.

Romania has in recent years seen its economy boom mainly as a result of the debt-backed rising consumption and the ballooning current account deficit was the price it paid for this.

While economic growth should be based to a great extent on investments and net exports, in reality GDP increase will most certainly be further led by consumption, supported through foreign loans.

Such economic growth is no longer a viable solution, though, as foreign investors are ever more reluctant to finance countries living on debt.

While the foreign deficit has adjusted this year, next year's main problem is high budget deficit. Financing this deficit entails high costs, eroding the potential of earmarking money for investments. And, with the IMF agreement frozen and with no credibility, it will be ever more difficult to finance.