CESEE: Economic Convergence Clouded by Political Uncertainty

The international environment for the economies in Central, East and Southeast Europe (CESEE) presents itself as a stark contrast between economic upswing on the one hand and political uncertainty and geopolitical tensions on the other. In the short term, positive effects of the economic recovery in the euro area and related exports, as well as of the continuously low oil price are prevailing over potentially negative effects of political turmoil. Compared with the wiiw Spring Forecast, growth projections for the CESEE region were for the most part revised upwards to 2.4 and 2.6 percent for the years 2017 and 2018, respectively.