EBRD sees 5.2% growth in central and eastern Europe in 2021

The European Bank for Reconstruction and Development (EBRD) has raised its forecast for central and eastern Europe and the Baltic states (CEB) to 5.2 percent for 2021 in its latest Regional Economic Prospects (REP) report, published today.

This corresponds to an upward revision of 0.6 percentage points from the Bank’s June forecast, largely down to better-than-expected output in the first half of 2021, though supply-chain disruptions weighed on growth in some economies. For 2022, the EBRD economists forecast growth in the region to moderate to 4.7 percent. 

“This is a bittersweet recovery. The first half of 2021 brought a robust rebound. But we are now seeing growing cause for concern. While high commodity prices are benefiting exporters, they are weighing heavily on the trade balances of importers. The supply of affordable energy as we enter the winter period is becoming a serious worry, especially as governments’ headroom is limited,” Beata Javorcik, EBRD Chief Economist, said.

EBRD noted that in the first half of 2021, Poland’s GDP grew 4.6 percent y/y. According to the Finance Ministry, EU funds could add 0.4 percentage points to annual growth. Overall, GDP growth is forecast at 4.9 percent and 4.8 percent in 2021 and 2022, respectively.

(WBJ)