Significantly smaller was the contribution of gross fixed capital to the country ‘s annual economic activity in 2023 of the initial estimates , notes a relevant analysis of it . This is because there has been a fall in GDP by 5.7% on an annual basis in the fourth quarter of 2023, for the first time since the second quarter of 2020, burdening 0.9% of GDP growth in the fourth quarter. This development was mainly due to the very negative impact of a base on housing construction as well as investment in machinery and equipment and unexecuted costs. The contribution of 0.5% of GDP to economic activity for the year 2023 reflects an annual increase in investment by 3.9% compared to an annual average of 15.4% in 2021-2022, reported in the National Bank report. The analysis emphasises that the dynamics of the GFCCs declined during 2023, recording four consecutive quarterly falls due to the tightening of monetary policy and the normalisation of profit margins from their high levels in 2021-2022, which made businesses more cautious in their investment decisions. It is noted that the GFCF is concerned with machinery and equipment, vehicles, housing and other buildings. Thus, the report records lower investment in machinery and equipment by -16% on an annual basis in the fourth quarter a fall in residential investment by 19% for the first time in 6 years. At the same time, a backward concentration in public investment was recorded in 2023 including the funds of the Recovery Fund, which increased to the historic high of EUR 11.2 billion from EUR 11 billion in 2022, with more than 40% of the annual disbursements from the state budget taking place in the 4th quarter (about 25% in December) including around EUR 0.4 billion of compensation to flood victims. The analysis points out that these payments came too late to influence the activity of 2023. Consequently, the share of the relative increase in GDP and final consumption will be transferred to 2024.
Lower than estimates, fixed capital investment in 2023
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