Election years are a good time to present results. A favorite comparison that I have seen these days is between Romania’s economic growth in 2011 and that of EU27. Of course this comparison is chosen for a reason as Romania is expected to have grown faster in 2011 than EU27. But does one year matter? Not for me. That is why I will show you three graphs that paint a different picture.
First let’s look at inflation. How did Romania do in the last three years relative to EU and individual countries in the region? Not very well. Since 2010 Romania still has the highest average inflation per year. Even Iceland, a bankrupt country, managed to bring average inflation to a level that is lower than for Romania.
Let’s now turn to economic growth. As you can see only in 2011 Romania is growing a bit faster than EU but still slower than its peers in the region. The comparison with EU is not really correct as developed economies will never grow as fast as emerging one. Thus the comparison that matters is with similar countries and there Romania is still behind.
However, in order to compare economic policies we need to look at average yearly growth for the last three years in ROmania, Eastern Europe and EU. The idea here is that all three had a period of deep recession in 2009. However, the economic performance of 2009 is the result of good or bad economic policies in each country. For example good economic policies would in theory be able to reverse the lost GDP in 2009 via economic growth in 2010 and 2011. Thus, on average good economic policies should at least deliver zero growth over the period. Unfortunately this is true for EE and EU but not for Romania.
Here is the graph that proves this assumption:
It is easy to bias a conclusion towards your side of the story when you pick certain periods or different entities. Comparing Romania with EU is not really relevant. A more appropriate comparison is for Romania with EE or emerging economies. This way we will get a more realistic picture of our economic performance. So far we can see that in the last three years average inflation remained high relative to EE or EU. The under performance relative to these regions is also seen when we compare average economic growth for the period 2009-2011. These numbers tell me that our economic policies for the last three years have not worked. Maybe it is time to come up with new ones.