Romania, close to stagnation in 2026. World Bank: negative growth and slow recovery in 2027
The World Bank has revised down the forecasts regarding the evolution of the Romanian economy, estimating a growth of 1.7% in 2027, compared to 1.9% in the previous forecast from January. For 2028, the international institution anticipates an advance of approximately 2%, in the context of a fragile global economic climate and persistent fiscal constraints.
The World Bank has revised down Romania's economic growth. Photo by Shutterstock
Romania's GDP expansion should stand at 1.7% next year, after the World Bank forecast an advance of 1.9% in January.
In 2028, the Romanian economy would register a growth of 2%.
Since January, the most significant worsening of the forecasts were in Romania, Turkey, the Republic of Moldova and Ukraine, determined mainly by the shock of the price of raw materials, along with the specific developments of each country, the report shows.
“In the period 2026-2028, fiscal policy is expected to largely support growth in most economies. Fiscal deficits are expected to remain high amid persistent spending pressures, including on defense, and temporary economic measures such as domestic subsidies and price controls to cushion the impact of higher energy prices. Limited fiscal space, especially in Montenegro, Romania and Ukraine, will likely constrain the authorities' ability to absorb this shock“, warns the World Bank.
The upcoming elections in many countries add to the uncertainties regarding the fiscal outlook. Energy exporters stand out, with higher revenues from hydrocarbons helping consolidation efforts. In Europe and Central Asia (ECA), the average level of public debt would increase to approximately 40% of GDP by 2027, the report states.
Inflation, consumption and macroeconomic risks
The World Bank shows that the evolution of the Romanian economy during the analyzed period is influenced by a fragile external context and a series of internal constraints that limit the rate of growth. In this framework, price pressures and financial conditions remain important factors in economic dynamics, with a direct effect on private consumption and investment decisions.
According to the international institution, private consumption continues to be affected by pressures on real incomes and economic policy conditions, which limits the ability to sustain economic growth in the coming period. At the same time, investments remain an element of support, especially through the contribution of projects financed by European funds.
Exports and imports evolve in a context of gradual adjustment, in which external demand plays an important role and trade imbalances tend to gradually reduce as import dynamics slow down.
The World Bank report emphasizes that the limited fiscal space represents an important constraint for Romania and other economies in the region, reducing the authorities' ability to respond to economic shocks. In this context, fiscal policy remains a relevant factor for supporting economic activity, but also a source of pressure on macroeconomic balances.
The World Bank also warns that external developments, including shocks on raw materials markets and global uncertainties, continue to influence the economic prospects of the region, including Romania, in the period 2026-2028.
