South-Eastern Europe Economic Outlook
Regional economic growth is projected to soften this year, mainly due to a weaker expansion in heavyweight Turkey. That said, most other economies in the region are seen growing at a faster clip this year on lower inflation and interest rates. Ethno-nationalistic tensions and additional spillovers from the wars in Ukraine and Gaza are downside risks.
South-Eastern Europe Inflation
Regional inflation fell to 36.9% in January from December’s 37.0% due to softer price pressures in Croatia, Greece and Serbia. Inflation is forecast to decline from current levels by end-2024 thanks to a high base effect and the lagged effects of prior monetary tightening. Commodity price spikes and supply shocks stemming from conflict in the Red Sea pose upside risks.
2019 | 2020 | 2021 | 2022 | 2023 | |
---|---|---|---|---|---|
Inflation (CPI, ann. var. %, aop) | 8.8 | 6.7 | 11.4 | 43.4 | 32.8 |
CBI Policy Rate (%, eop) | 7.16 | 9.59 | 7.95 | 7.04 | - |
Exchange Rate (LBP per USD, eop) | 11.45 | 12.05 | 16.46 | 20.01 | - |
Economic Growth (GDP, ann. var. %) | 2.0 | -1.7 | 9.6 | 5.1 | - |
Private Consumption (ann. var. %) | 2.3 | -0.6 | 11.5 | 13.1 | - |
Fixed Investment (ann. var. %) | -3.3 | 3.9 | 7.4 | 3.8 | - |
Industrial Production (ann. var. %) | -1.1 | -1.6 | 13.2 | 3.9 | - |
Unemployment (% of active population, aop) | 12.3 | 12.1 | 11.0 | 9.7 | - |
Fiscal Balance (% of GDP) | -2.0 | -5.8 | -4.2 | -2.2 | - |
Public Debt (% of GDP) | 56.6 | 66.6 | 65.0 | 54.7 | - |