Domestic demand down 15 pct in Q2 2009 y-o-y

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Domestic demand in Romania fell 15 percent in the second quarter of 2009 from the same period of 2008, chairman of the Romanian Banking Institute (IBR) Petru Rares told specialty conference ATC – Agora Technology Conferences.

„In the second quarter of 2009, domestic demand fell by nearly 15 percent from the same period of 2008. We can also say that in the first six months of the year the Romanian economy underwent a dramatic adjustment to the point that the current account fell to half,” said the IBR official.

According to Petru Rares, a solution to jolt out of crisis or fare through it in a profitable manner would be for traders to adjust to the buyers’ budgets.

In the opinion of the cited official, Romania will be inevitably hit by deflation, a moment when prices and interest rates will go down, whereas demand will increase.

„I think that Romania too will be hurt by the deflation virus. And we all know that in such a situation prices and interest rates fall and demand goes up,” said Petru Rares.

He added that inflation might reduce, „but this requires major investments with a return rate spread over a long term.
The IBR representative also tackled the stage of the economic recession, saying that Romania experiences for the first time a dramatic broad-scope crisis.

„For Romania, this is the first wide-scale dramatic crisis. Globally, there has never been such a fall in GDP and we can say that we experience the most severe economic de-multiplying effect,’ said Petru Rares.

The Hall of the Romanian Banking Institute on Wednesday was the venue of the second edition of the ATC – Agora Technology Conferences, devoted to new ground broken in IT&C infrastructure.

ATC are organized in Bucharest together with state institutions such as the Ministry of Communications and Information Society (MCSI), the Agency for Information Society Services (ASSI), as well as expert organizations such as the CIO Council and the Romanian Banking Institute.

The target audience of ATC are IT mangers, Chief Information Officers, decision-makers, the officers who design the acquisition budgets for large corporations.

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