GDP growth is set for a moderate but steady recovery. Export market growth is projected to pick up and it will spill over to private investment as confidence improves and financing conditions remain generally favourable. Private consumption remains subdued on account of slow employment growth, weak real incomes and on-going deleveraging, but will pick up towards the end of the projection period.
Fiscal consolidation is on track and the automatic stabilisers should be allowed to work freely around the planned structural improvement. However, several of the planned additional revenues and spending cuts may not generate the savings currently predicted, and shortfalls would have to be made up. Restructuring of the banking sector has advanced but support to the sector may still require additional measures, which should be debt financed so as not to endanger the fragile recovery.
Note: All data definitions based on internationally comparable standards and may differ in specific cases from common national definitions.
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