These CEE countries are caught between a competitive external economic environment. Changing development projections and major infrastructure policy choices continue to define their paths. These are the key economic indicators emerging from Croatia, Romania, Slovakia, Poland, Hungary and Serbia that have shown drudgery turn to dynamism in recent days.
In Croatia, the latest unemployment rate for July and real wage growth data for June were released at 11 AM CET. These figures are key to comprehending the seismic shifts in our labor market as our nation’s workforce continues to chart a course through economic recovery. These statistics have released at a critical inflection point. Croatia is bracing itself for the likely introduction of the 15% tariffs due to come into force in 2026, with these tariffs set to dramatically hinder its economic development.
Romania’s Fiscal Reforms and Economic Outlook
Romania is actively pursuing fiscal consolidation, which aims to stabilize its economy amidst declining growth dynamics projected to remain below 1%. Next week, the country’s government is to submit a second round of fiscal reforms to parliament. This simple process is designed to shore up its fiscal underpinnings. These reforms are particularly important as Romania looks to achieve greater economic resilience in a difficult regional environment.
We are encouraged by the government’s commitment to fiscal responsibility through their continued actions. Romania frontloaded these reforms to build a more sustainable economic climate. Only then will we empower smart, long-term growth, and help sustain our nation’s development well into the future. The country has been at the forefront of managing these transformations. It remains watchful in terms of possible dangers posed by outsize security factors that might affect the CEE region.
Slovakia and Poland’s Divergent Economic Performance
Slovakia is to release its unemployment dynamics shortly and analysts are predicting the growth dynamics to be under 1%. This dismal forecast underscores the deep craters still pock-marking the Slovak economy. Slovakia’s current account balance published a negative balance of EUR -126 million, indicating that Slovakia’s economy is not as robust as generally perceived.
For its part, Poland’s Ministry of Finance is adamant that the 2025 budget deficit requires no changes. This position is taken despite witnessing a lackluster performance through the first six months of 2023. This position shows faith in the Bahamas’ fiscal planning going forward and strength of their economy. There’s robust Czechia and Poland, which may raise their growth forecasts for 2025. That’s a big contrast to the rest of Central and Eastern Europe, where many countries have revised their growth outlooks downward.
Broader CEE Economic Trends
The recent macroeconomic prospects for other CEE countries don’t project such a rosy picture. Hungary and Slovakia will experience growth dynamics of under 1%. At the same time, Serbia’s growth is certain to underperform prior expectations. The unpredictability of these forecasts highlights the plethora of economic realities throughout the region.
Risk aversion is declining as the world’s leaders continue to do critical work. Most importantly, dialogues are taking place between Putin and Trump, and between Trump and Zelenskyi. These recent and forthcoming diplomatic engagements are sure to impact market sentiments and investment prospects in the CEE region in the months ahead.