According to the provisional estimate released by the Romanian Statistical Office, the Romanian GDP saw a modest growth of 0.9 % against the 2023. For the seasonally adjusted data, it grew by 0.8% QoQ and by 0.7% YoY, and for seasonally unadjusted data, we can also see growth by 0.7% YoY. At current prices, this would mean that the Romanian GDP amounted to RON 1.77tn (approximately EUR 354.1bn).
The Romanian Statistical Office has released the latest GDP growth estimates, revealing modest increases on both YoY and QoQ bases. For Q4 2024, the adjusted GDP figures reached RON 453.8bn (approximately EUR 90.8bn), marking an increase of 0.8% QoQ and 0.7% YoY. Meanwhile, the unadjusted series for the same quarter stood at RON 523.7bn (approximately EUR 104.7bn), reflecting a YoY growth of 0.7%. For the full year of 2024, the GDP is estimated at RON 1.77tn (approximately EUR 354.1bn), showing a growth of 0.9% over 2023, which fell short of expectations set by the European Commission.
In 2024, Romania’s economy saw contributions to GDP growth from a diverse range of sectors. Notably, the wholesale and retail trade, along with motor vehicle repairs, transportation, storage, hotels, and restaurants, collectively enhanced the GDP by 0.4 p.p., accounting for 20.7% of the overall GDP. This group experienced an activity increase of 2.1%. Similarly, sectors such as public administration, defense, social security, education, health, and social assistance added 0.1 p.p. to the GDP growth, making up 12.8% of GDP, with activities growing by 0.6%. Additionally, the cultural, recreational, and entertainment sectors, along with household goods repairs and other services, contributed 0.2 p.p. to GDP growth, with these activities enjoying a robust growth of 6.8%.
On the flip side, some sectors faced challenges. Agriculture saw a notable decrease in activity by 10.5%, resulting in a reduction of 0.4 p.p. from GDP growth, despite making up 3.2% of the GDP. The construction sector also faced a downturn, with a 2.4% drop in activity, reducing the GDP growth by 0.2 p.p., and real estate activities declined by 1.3%, impacting the GDP by 0.1 p.p..
The information and communication sector, alongside financial intermediation and insurance, and professional, scientific, and technical activities, as well as administrative and support services, maintained a steady pace without significantly altering the GDP dynamics, as noted by the National Institute of Statistics (INS).
A notable positive impact was also seen from net taxes on products, which surged by 9.6% in volume, contributing an additional 0.9 p.p. to GDP growth.
Seasonally adjusted quarterly YoY GDP development (2010 – 2024, %)
Source: Romanian Institute of Statistics, InterCapital Research
In terms of GDP usage, the main driver of growth in 2024 was the rise in household consumption expenditure, which escalated by 5.9%, contributing a substantial 3.6 p.p. to GDP growth. In contrast, a decline in public administration consumption expenditures by 3% and a 2.4% drop in collective consumption both detracted 0.2 p.p. each from the GDP. Additionally, a decrease in gross fixed capital formation by 1.7% negatively impacted GDP by 0.4 p.p..
Challenges in the export sector, marked by a 3.6% decline in goods and services exports coupled with a 3.4% increase in imports, resulted in a net export decrease of 2.9 p.p., underscoring a tough global trading environment and negative trade balance.
As we discussed earlier in our flash news, the 2025 budget plan for Romania projects economic growth at 2.5%, with inflation expected to fall to 4.4%, and the budget deficit aimed to reduce to 7% of GDP. This growth trajectory hinges on effective fiscal management, the impact of potential tax increases, and how household consumption copes with ongoing inflationary pressures. Despite a slowdown, wage growth remains among the highest in the EU, strongly influencing consumption trends. Moreover, interest rate cuts are deferred due to persistent inflation and fiscal challenges.
Overall, with inflation above the EU average, Romania’s GDP growth is anticipated to surpass that of many developed EU nations, as predicted by the European Commission. Yet it lags behind its Eastern European neighbors. This situation is shaped by internal factors such as political instability and external geopolitical threats, including the ongoing conflict in Ukraine, Middle East tensions, and global trade disputes.
