The countries of central and eastern Europe grew by 4.3 per cent in 2001, outperforming global economy, but their growth will weaken in 2002, according to the latest EBRD transition report.
The European Bank for Reconstruction and Development (EBRD) says higher consumer spending and greater business investment underpinned the region’s strong performance in 2001, countering the effects of a global economic slowdown. Both consumption and investment improved because of rising incomes and an enhanced investment climate across much of the region.
The prospects of a global economic upturn in 2002 should support the region’s continued growth, particularly through the pick-up of export markets to EU economies. The region is set to outperform the world economy again in 2002, albeit by a narrower margin.
The prospects are not good for all the countries in the region. In Poland, domestic demand is likely to remain subdued in the face of continued high real interest rates and fiscal consolidation.