Regional economies are recovering – Vienna InstituteReading Time: < 1 minutes
A leading think-tank has upped its growth forecast for Central, East and Southeast European economies this year to 5.4%, up from 4% in the summer in 2021. The region’s smaller services sector and looser COVID restrictions have been drivers in good economic performance, the Vienna Institute for International Economic Studies (WIIW) wrote, adding that the Eurozone will grow 4.8% this year.
Private consumption – the main driver of growth in the region – will climb 14.5% this year, while regional investment will rise by 18%. Moldova and Montenegro have the highest predicted growth, at 8.4% and 8% respectively. Montenegro’s economy contracted by 15.3% in 2020, due to the decline in tourism, its most important industry.
Prospects for 2022 are also good for the region, with 3.7% growth expected in 2022. The think-tank forecasts near 5% growth for Croatia, Poland, Montenegro and Kosovo next year. “In EU-CEE countries, growth will be crucially helped by disbursements from the EU Recovery and Resilience Facility, which aims at facilitating economic recovery and simultaneously at fostering digital and green transition,” according to the Austrian think-tank.