Page 15 - EBRD_newspaper_May2017

May 9, 2017
Russia CPI vs CBR key monetary policy interest rate
Watcom Russian shopping index
Croatia's General Government Deficit
Russia's Sberbank cuts mortgage rate to below 9% for selected developers
Data bne IntelliNews Daily 15 World Bank reports faster growth in
Russian state-owned retail bank Sberbank has tem- porarily cut mortgage rates to below 9%. That is well down on the 12% rate that the government has tar- geted as a desirable level and offered subsidies on any rate above that level until recently.
Sberbank has temporarily reduced mortgage rates for apartments being built by certain develop- ers to 8.4-8.9%. This assumes a 2-2.5% discount to the basic mortgage rate of 10.5%, part of which is subsidised by the respective developers (up to 1.5%), and part (up to 1%) by Sberbank, VTB Capital reports.
Moscow’s Watcom shopping index negative trends stabilising, but still underperforming
The disappointing negative trends in retail in Russia’s capital continued in the first quarter of this year, but have started to stabilise, according to the Watcom shopping index, preceding a recovery later this year.
The Watcom shopping index ended 2016 on a strong note with footfall in Moscow’s leading shop- ping malls increasing to just below the 2015 levels. But the index got off to its worst start in three years in the first weeks of 2017, as bne IntelliNews re- ported last month.
The following weeks 9-15 have not been much better and the index is still well below the levels seen in the last three years, finishing week 16 at 493.58 – well below the index levels of between 508-556 in the previous years.
Croatia’s budget deficit shrinks to 15-year low
Croatia’s consolidated general government deficit fell to HRK2.78bn (€373mn) or 0.8% of GDP in 2016 from HRK11.4bn or 3.4% of GDP in 2015, according to data published on April 24 by the statistics office based on figures from its Excessive Deficit Procedure (EDP) report.
Croatia, which entered the European Commis- sion’s EDP in January 2014, has been trying to reduce its deficit over the past two years. The EU’s Maastricht criteria required Croatia to cut the government deficit to below 3% of GDP. However, there is no immediate prospect of exiting the EDP as the country’s public debt is still well above the 60% of GDP threshold set by the commission.
Western Balkans bringing more jobs
Countries in the Western Balkans are growing at a faster pace now than in 2015, with regional economic growth projected at 2.8% in 2016 and 3.2% in 2017, which will bring more new jobs to the region, according to the latest World Bank Western Balkans Regular Economic Report.
Despite this progress, the World Bank said that the labour market remains challenging in the Western Balkans, with the unemployment rate hovering around 22% in 2016.
While only two countries registered a higher growth in 2016, it was enough for the overall growth in the Western Balkans to in- crease by 0.6 percentage points (pp).
"Accelerating growth in Albania and Ser- bia compensated for weaker expansion in Montenegro and Macedonia, while growth in Kosovo slowed in 2016, but it remained the fastest growing economy," the World Bank said in its latest report.
Albania’s and Serbia’s GDP has increased to 3.2% and 2.8% respectively. The economy slowed down to 2.4% in Macedonia and 2.1% in Montenegro. Kosovo posted the strongest growth of 3.6% in 2016, even though it slowed from 4.1% growth a year earlier. Bosnia's growth was also lower at 2.8%.
A Positive Growth Outlook (Real GDP growth, per cent)
Country
2015
2016e
2017f
2018f
Albania
2.6
3.2
3.5
3.5
Bosnia and Herzegovina
3.0
2.8
3.2
3.7
Kosovo
4.1
3.6
3.9
4.2
FYR Macedonia
3.8
2.4
2.8
3.3
Montenegro
3.4
2.1
3.3
3.0
Serbia
0.8
2.8
3.0
3.5
Western Balkans
2.2
2.8
3.2
3.6
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