Economic trends
Since the early 1990s, successive governments have gradually promoted a liberal economic policy to privatize the state owned companies. Following its accession to the European Union in January 2007, Romania has begun a new phase of economic growth with substantial foreign investments. Like many other countries of the former Soviet bloc, its economy has been transformed into a market economy. The GDP has grown at a regular rhythm and a middle class has developed. Romania has become the second most dynamic country in the region after Poland. The unemployment rate, which was quite low before the financial crisis, has been growing since 2008 and reached 7.2% in 2011. Romania has one of the lowest public debts in the EU (around 35% of the GDP) and inflation stabilized at 4.6% in 2011.
However, even if Romania enjoys a significant potential, notably due to its rich agricultural land and its well-educated and high-qualified workforce, it still remains one of the poorest countries in Europe with a poverty rate of 6% of the population. Due to the financial crisis, Romania endured a strong economic slowdown, especially in the automobile sector which is subject to foreign demand and the country entered into recession in 2009-2011. The country, which managed to reduce its public deficit to 4.4% of the GDP in 2011, hopes to be able to bring it under the 3% limit in 2012. It should again grow in 2012, with an estimated rate of 1.8%.
Romania maintains its objective of joinging the eurozone in 2015.
Main branches of industry
Agriculture represents almost 7% of Romania's GDP and employs 28% of the country's active population. The main resources and agricultural production in Romania are cereals, sugar beets and potatoes. However, the production remains very low in comparison with the the country's potential capacity. About 25% of the country is covered by forest (especially around Transylvania) and the logging industry is developing very fast.
The industrial sector contributes to 37.3% of the country's GDP and employs almost a third of the active population. Historically, the manufacturing companies and the industrial sectors represent the backbone of Romania's economy. That is why many foreign direct investors are involved in heavy industry (metallurgy, steel), the manufacturing of vehicle parts, building and construction, petroleum refining and textiles. However, during the last few years, new technologies have been moving forward due to the growth of high-qualified workforce whose cost is lower than the European average.
Romania's economy is mainly centered in the services sector, which represents 55.7% of the GDP and employs 39% of the nation's workforce. Tourism, in particular, is booming.
International trade
Romanian exports have increased by almost 30% between 2006 and 2008. Imports have followed the same trend but with a volume of about two times higher (an increase of almost 60%). These results show that Romania remains too dependent on imports. The global economic crisis has accentuated the deficit in the balance of payments in 2009, which reached EUR 12 billion, meaning an increase of 15% in one year. In addition, Romania's main partners are also in economic difficulties themselves and the level of exports has decreased in a parallel way.
Romania's main export partners are Germany, Italy, France and Turkey. The country mainly exports industrial products. In both 2010 and 2011, the country's exports and imports increased, evidence of a global economic revival. Despite all, the deficit of the country's trade balance has not decreased and it should remain present in 2012.
Romania's main suppliers are Germany, Italy, Hungary and France. Imports have been rising since 2011. This growth can be explained essentially by the needs of export-oriented industrial activity. The strongest growth was therefore recorded in imports of electric and mechanical equipment and metal products (27% and 34% respectively), while the part of imports of consumer goods has been smaller.
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Last updates: May 2012
