GDP will contract
by 12 percent in 2020

Inflation, poverty, and

deficit forecasted to skyrocket

GDP is expected to shrink by 12 percent in 2020 according to Alain Bifani, Director General at the Ministry of Finance. He said that in 2019, GDP has shrunk by 6.7 percent

In a video presentation to Eurobond investors, Bifani said that the forecasted decline is due to the dollar shortage which has put a massive drag on nonfuel imports, as well as on the impact of the coronavirus.

“This will exacerbate the deterioration of social conditions with the poverty rate reaching 45 percent and 22 percent of the population living in extreme poverty,” he said.

Bifani said that inflation is expected to reach 20 to 25 percent in 2020. There is a high risk of an acceleration of inflation due to a sharp depreciation of the exchange rate of the lira to the dollar on the parallel market.

He also predicted that primary fiscal deficits (deficit not including debt service) seem here to stay for some time.