Wiener Institut für Internationale Wirtschaftsvergleiche The Vienna Institute for International Economic Studies www.wiiw.ac.at Press Conference, 3 July 1 New wiiw forecast for Central, East and Southeast Europe, 1-1 Investment to the Rescue Despite Negative Effects of Ukraine War and Balkan Flood Mario Holzner CESEE GDP growth weak but on the rise Development of quarterly GDP, real change in % against preceding year 1 1 1 - - - 11 q 11 3q 11 q 11 1 q 1 3q 1 q 1 13 q 13 3q 13 q 13 1 EE 1 ranking TR MK PL RO KZ HU LT NMS-11 LV CZ SK BA SI ME BG EU-15 AL RU RS HR UA Remark: Highlighted lines represent top 3 and bottom 3 countries referring to growth of 1st quarter 1. Source: National and Eurostat statistics.
3 Deflationary pressures have built up Consumer prices, change in % against preceding year 1 1 1 Serbia Russia Turkey Ukraine Range for other CESEE Average Kazakhstan - Jan-13 Mar-13 May-13 Jul-13 Sep-13 Nov-13 Jan-1 Mar-1 May-1 Source: wiiw Monthly Database incorporating national and Eurostat statistics. Confidence in the economy on the rise CESEE gross industrial production change in % against preceding year / industrial confidence indicator in pp. 15 1 5-5 -1-15 - -5 industrial production (lhs) industrial confidence indicator (rhs) 5-5 -1-15 - -5-3 -3 Apr-7 Apr- Apr-9 Apr-1 Apr-11 Apr-1 Apr-13 Apr-1-35 Remark: Average over available countries. Source: wiiw Monthly Database incorporating national and Eurostat statistics for industrial production. Eurostat and national statistics for industrial confidence.
5 Investment activity: so far mild recovery in the NMS Gross fixed capital formation, real change in % against preceding year, seasonally adjusted and adjusted data by working days 3 1-1 HU LT PL CZ SK EE NMS-11 BG EU-15 SI LV - 1Q'1 Q'1 3Q'1 Q'1 1Q'13 Q'13 3Q'13 Q'13 1Q'1 1 ranking Remark: Highlighted lines represent top 3 and bottom 3 countries referring to growth of 1st quarter 1. Source: National and Eurostat statistics. Investment activity: NMS levels remain below 7 Gross fixed capital formation, Q =1, seasonally adjusted and adjusted data by working days 1 BG CZ EE HR HU LT LV PL RO SI SK EU-15 NMS-11 1 1 1 1Q'7 1Q' 1Q'9 1Q'1 1Q'11 1Q'1 1Q'13 1Q'1 Source: Eurostat, wiiw calculations.
7 Construction sector: NMS differentiated recovery from slump Construction, change in % against preceding year, seasonally adjusted and adjusted data by working days 3 1-1 - -3 1Q'1 Q'1 3Q'1 Q'1 1Q'13 Q'13 3Q'13 Q'13 1Q'1 1 ranking SI LT HU LV NMS-11 PL EU-15 CZ BG SK EE HR RO Remark: Highlighted lines represent top 3 and bottom 3 countries referring to growth of 1st quarter 1. Source: National and Eurostat statistics. Construction sector: NMS levels remain mostly below 7 Construction, Q = 1, seasonally adjusted and adjusted data by working days BG CZ EE HR LV LT HU 1 PL RO SI SK EU-15 NMS-11 1 1 1 1Q'7 1Q' 1Q'9 1Q'1 1Q'11 1Q'1 1Q'13 1Q'1 Source: Eurostat, wiiw calculations.
Investment to spur 1 GDP growth in most of core CESEE GDP growth in 13 & 1 in % and contribution of individual demand components in percentage points, weak 13 household consumption countries 9 1 GFCF investment Household final consumption Net exports GDP (growth in %) - - - 13 1 Serbia Croatia Bosnia & Slovenia Albania Bulgaria Czech Herzegovina Republic Slovakia Hungary Poland Remark: Ordered by 1 growth rates. Bosnia & Herzegovina based on GDP expenditure. Source: For 13 wiiw and national statistics as of July 1. Forecast 1 by wiiw. Growth drivers differentiated in crisis and peripheral CESEE GDP growth in 13 & 1 in % and contribution of individual demand components in percentage points, dynamic 13 household consumption countries 1 1 GFCF investment Household final consumption Net exports GDP (growth in %) - - - Ukraine Russia Estonia Montenegro Latvia Macedonia Lithuania Turkey Romania Kosovo 13 1 Remark: Ordered by 1 growth rates. Ukraine: GDP growth rate including Crimea and Sevastopol. Source: For 13 wiiw and national statistics as of July 1. Forecast 1 by wiiw.
11 Summary Upward reversal of EU-supported public infrastructure investment has potential to spur private investment Euro area growth likely to encourage export industries investments CESEE GDP growth to pick up speed and amount to -3% annually on average in 1-1 Ukraine-Russia conflict negatively affects growth prospects also in the Baltics (average 5 countries 1 forecast revision since March: -1.%) Floods and fiscal austerity dampen growth forecast for Western Balkans (average 1 forecast revision since March: -.5%) Core CESEE economies with improved growth expectations as investment activity is even stronger than expected (average 1 forecast revision since March: +.%) 1 GDP growth, current wiiw forecast for 1-1 1 15 1 Kosovo 5... Romania 3. 3. 3.3 Poland 3. 3. 3.1 Lithuania.9 3.1 3. Turkey.9 3.5.5 Macedonia..9 3. Latvia.7.9 3.1 Hungary...1 Slovakia. 3. 3. Montenegro.1.9 3. 1 15 1 Czech Republic 1.7. 3. Bulgaria 1..1.5 Albania 1.3 1.5.9 Estonia.7 1.. Russia. 1..3 Slovenia.5 1. 1.7 Bosnia and Herzegovina. 1.5 3. Croatia -.5.7 1.5 Serbia -1.. 1. Ukraine -5.. 1. Remark: Ukraine:GDP growth rate up to 1 including Crimea and Sevastopol. Source: wiiw forecast, July 1.
1 Country codes AL Albania MK Macedonia BA Bosnia and Herzegovina PL Poland BG Bulgaria RO Romania CZ Czech Republic RS Serbia EE Estonia RU Russia HR Croatia SI Slovenia HU Hungary SK Slovakia KZ Kazakhstan TR Turkey LT Lithuania UA Ukraine LV Latvia XK Kosovo ME Montenegro CESEE CIS NMS SEE Central, East and Southeast Europe Commonwealth of Independent States New Member States Southeast Europe