Economic growth is projected to be moderate in 2013 but to increase to around 2½ per cent next year, provided that a large planned increase in energy-intensive investment takes place. Unemployment should fall to slightly below the structural rate of around 5% by 2014. Following monetary policy tightening and recent exchange rate appreciation, inflation is set to fall too, but to remain above target.
Further fiscal consolidation is needed to wind back the public sector debt from its current ratio of 130% of GDP to a more prudent level. Adoption of the proposed law to increase fiscal discipline would be welcome. Monetary policy accommodation should continue to be removed as conditions permit to reduce inflation and support eventual capital account liberalisation.
Note: All data definitions based on internationally comparable standards and may differ in specific cases from common national definitions.
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