Raiffeisen: 1.3% contraction of Central and Eastern Europe GDP in 2009

Gross Domestic Product (GDP) of Central and Eastern European states will shrink by 1.3% this year from prior year, amid economic downturn, however, the region will continue to be EU’s growth motor, according to an analysis made public by Raiffeisen International.

In order to avoid long-term consequences over the real economy, the analysts say the “exaggerated portrayal of risk” has impacted the stock prices of many companies active in the region which have become detached from the companies’ fundamental business development.

"We must not return to a Europe of two different speeds. The European Union and many other institutions have invested too much in the project of one common and stable Europe”, reads the analysis.

Analysts say Austria’s GDP will shrink by 1.3% this year, the same decline expected for the region.

Raiffeisen International, subsidiary for the network outside Austria of Raiffeisen Zentralbank Österreich (RZB), is the second biggest bank in CEE region, after UniCredit. In Romania, Raiffeisen International is active in Romanian market with its Raiffeisen Bank Romania and Raiffeisen Housing Bank (Raiffeisen Banca pentru Locuinte).

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