Romania - Republic of Romania

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Economic and political outline

Economic indicators | Foreign Trade in figures | Sources of general economic information | Political outline

Economic indicators

Since the early 1990s, successive governments have gradually promoted a liberal economic policy to privatize the companies owned by the state (around 30% of GDP in 2006 was generated by domestic firms). Following its accession to the European Union in January 2007, Romania will begin a new phase of economic growth with substantial foreign investment. Like many countries of the former Soviet bloc, its economy has been transformed into a market economy. The GDP growth was 8.4% in 2004, and fell significantly to 4.1% in 2005 due to flooding and increased imports, but increased again to 7.7% in 2006 and is expected to remain above 6% in 2007 and 2008 according to IMF forecasts. This indicates very strong growth and Romania is the second most dynamic country in terms of GDP growth in the region behind Poland.

There was a continued decline in inflation over the past decade to 154.8% in 1997 to 4.8% in 2007. The Romania National Bank (central bank) has strengthened its monetary policy due to the severe depreciation of the national currency. The unemployment rate is only 4.1% of the workforce which is relatively low and reflects the movement towards rapid growth. However, Romania still remains one of Europe's poorest countries but it has considerable potential for development because of its rich agricultural land, a well-educated and skilled workforce, and tourism.

Main indicators	2006	2007	2008	2009	2010
GDP (billions USD)	122.70	169.29	199.67e	166.47	166.08
GDP (constant prices, annual % change)	7.9	6.2	7.1e	-4.1	-0.0
GDP per capita (USD)	5,670	7,850	9,292e	7,774e	7,782
Inflation rate (%)	6.6	4.8	7.8e	5.9e	3.9e
Unemployment rate (% of the labor force)	-	-	3.6	-	-
Current Account (billions USD)	-12.75	-23.45	-25.18e	-12.53	-10.85
Current Account (in % of GDP)	-10.4	-13.9	-12.6	-7.5e	-6.5

Source: IMF - World Economic Outlook Database ; CIA - The world factbook

Note: (e) Estimated data

Main sectors of industry

In 2007, the Romanian GDP was approximately 166 billion dollars (USD), which represents 11,100 dollars (USD) per capita. This per capita growth has created an emerging middle class over the past few years. The composition of the GDP is evolving into that of a market economy Starting with the services sector (56.5% of GDP in 2007), then the industrial sector (35.6%) and agriculture (7.9 %). This trend is also reflected in the distribution of the labor force by industry: workers made up 47.1% (in 2006) their positions include jobs in the tertiary sector, 29.7% in agriculture and 23.2% in branches in the aforementioned sectors. Romania is in transition even though historically, manufacturing and industry were the backbone of its economy. We see many foreign direct investments entering the country, particularly in heavy industry (metallurgy, steel), manufacturing of vehicle parts, building and construction, petroleum refining and textiles. However, new technologies are moving forward thanks to the availability of a more and more highly qualified workforce whose labor costs are lower than the European average. Tourism is a growing industry as well. The main cash crops in Romania are cereals, sugar beet, and potatoes but the yield remains very low in comparison with the capacity of the countries agricultural potential. About 25% of the country is covered by forests (especially around Transylvania) and the logging industry is developing very quickly.

Breakdown of economic activity by sector	Agriculture	Industry	Services
Employment by sector (in % of total employment)	32.1	30.3	37.5
Value added (in % of GDP)	9.0	36.1	55.0
Value added (annual % change)	6.0	6.0	6.0

- last available data.

Monetary indicators	2004	2005	2006	2007	2008
Romanian New Leu (RON) - Average annual exchange rate for 1 USD	3.26	2.91	2.81	2.44	2.52

Source: World Bank - World Development Indicators

Indicator of economic freedom

Score:: 63.2/100
Position:: moderately free
World Rank:: 65 out of 179
Regional Rank:: 29 out of 44

Distribution of Economic freedom in the world
Source: 2008 Index of Economic freedom, Heritage Foundation

Country risk

See the country risk analysis provided by Ducroire.

Foreign trade in figures

In exports, Romania's main commercial partners are in descending order: Germany, Italy, France and Turkey. The Romanian exports have shown an increase of almost 30% over the last two years. Imports in turn follow the same trend but with a slightly higher volume (an increase of 56%).

These results show that Romania still dependent on imports. The economic crisis accentuated the global trade deficit in the balance of payments over the period from January to September 2008 which reached EUR 12,704 million (or 14.8% more than during the same period in 2007).

Foreign trade indicators	2003	2004	2005	2006	2007
Imports of goods (millions USD)	22,155	30,150	37,348	47,172	64,689
Exports of goods (millions USD)	17,618	23,485	27,730	32,336	40,349
Imports of services (millions USD)	2,958	3,879	5,518	7,027	10,169
Exports of services (millions USD)	3,028	3,614	5,083	7,032	10,445
Imports of goods and services (annual % change)	13.6	18.3	3.7	8.6	12.0
Exports of goods and services (annual % change)	7.1	15.9	4.2	10.3	12.0
Imports of goods and services (in % of GDP)	42.2	45.0	43.3	44.1	43.7
Exports of goods and services (in % of GDP)	34.7	35.9	32.9	33.7	31.3
Trade Balance (millions USD)	-4,537	-6,665	-9,618	-14,836	-24,340
Trade Balance (including service) (millions USD)	-4,467	-6,930	-10,053	-14,831	-24,064
Foreign trade (in % of GDP)	76.9	81.0	76.2	77.8	75.0

Source: World Bank

Main partner countries

Main customers (% of exports)	2008
Germany	16.5%
Italy	15.5%
France	7.4%
Turkey	6.6%
Hungary	5.1%
Bulgaria	4.2%
United Kingdom	3.3%
Netherlands	2.9%
Ukraine	2.5%
Spain	2.3%
Austria	2.3%
Poland	2.0%
Greece	1.8%
Russia	1.8%
United States	1.7%
Moldova	1.7%
Belgium	1.6%
Czech Republic	1.6%
Slovakia	1.3%
United Arab Emirates	0.9%
See more countries	48.9%

Main suppliers (% of imports)	2008
Germany	16.4%
Italy	11.4%
Hungary	7.4%
Russia	6.0%
France	5.7%
Turkey	4.9%
Austria	4.9%
Kazakhstan	4.6%
China	4.2%
Netherlands	3.7%
Poland	3.4%
Czech Republic	2.5%
Belgium	2.0%
Spain	2.0%
United Kingdom	1.9%
Bulgaria	1.7%
Slovakia	1.5%
United States	1.4%
Greece	1.4%
Ukraine	0.9%
See more countries	53.2%

Source: Comtrade

Main products

Main exports (% of exports)	2008
Electrical machinery and equipment and parts...Electrical machinery and equipment and parts thereof; sound recorders and reproducers, television image and sound recorders and reproducers, and parts and accessories of such articles	13.5%
Nuclear reactors, boilers, machinery and...Nuclear reactors, boilers, machinery and mechanical appliances; parts thereof	10.0%
Mineral fuels, mineral oils and products of their...Mineral fuels, mineral oils and products of their distillation; bituminous substances; mineral waxes	9.2%
Vehicles other than railway or tramway...Vehicles other than railway or tramway rolling-stock, and parts and accessories thereof	8.3%
Iron and steelIron and steel	7.4%
Articles of apparel and clothing accessories, not...Articles of apparel and clothing accessories, not knitted or crocheted	5.9%
Articles of iron or steelArticles of iron or steel	3.6%
Furniture; bedding, mattresses, mattress supports,...Furniture; bedding, mattresses, mattress supports, cushions and similar stuffed furnishings; lamps and lighting fittings, not elsewhere specified or included; illuminated signs, illuminated name-plates and the like; prefabricated buildings	3.6%
Footwear, gaiters and the like; parts of such...Footwear, gaiters and the like; parts of such articles	3.5%
Wood and articles of wood; wood charcoalWood and articles of wood; wood charcoal	2.7%
Rubber and articles thereofRubber and articles thereof	2.6%
Ships, boats and floating structuresShips, boats and floating structures	2.5%
Plastics and articles thereofPlastics and articles thereof	2.4%
Articles of apparel and clothing accessories,...Articles of apparel and clothing accessories, knitted or crocheted	2.1%
Aluminium and articles thereofAluminium and articles thereof	1.9%
CerealsCereals	1.8%
FertilizersFertilizers	1.7%
Oil seeds and oleaginous fruits; miscellaneous...Oil seeds and oleaginous fruits; miscellaneous grains, seeds and fruit; industrial or medicinal plants; straw and fodder	1.4%
Railway or tramway locomotives, rolling-stock and...Railway or tramway locomotives, rolling-stock and parts thereof; railway or tramway track fixtures and fittings and parts thereof; mechanical (including electro-mechanical) traffic signalling equipment of all kinds	1.1%
Optical, photographic, cinematographic, measuring,...Optical, photographic, cinematographic, measuring, checking, precision, medical or surgical instruments and apparatus; parts and accessories thereof	0.9%
Tobacco and manufactured tobacco substitutesTobacco and manufactured tobacco substitutes	0.8%
Copper and articles thereofCopper and articles thereof	0.7%
Inorganic chemicals; organic or inorganic...Inorganic chemicals; organic or inorganic compounds of precious metals, of rare-earth metals, of radioactive elements or of isotopes	0.7%
Organic chemicalsOrganic chemicals	0.6%
Other made-up textile articles; sets; worn...Other made-up textile articles; sets; worn clothing and worn textile articles; rags	0.5%
Live animalsLive animals	0.5%
Man-made staple fibresMan-made staple fibres	0.5%
Pharmaceutical productsPharmaceutical products	0.5%
Articles of leather; saddlery and harness; travel...Articles of leather; saddlery and harness; travel goods, handbags and similar containers; articles of animal gut (other than silkworm gut)	0.4%
Miscellaneous articles of base metalMiscellaneous articles of base metal	0.4%
Paper and paperboard; articles of paper pulp, of...Paper and paperboard; articles of paper pulp, of paper or of paperboard	0.4%
Toys, games and sports requisites; parts and...Toys, games and sports requisites; parts and accessories thereof	0.3%
Animal or vegetable fats and oils and their...Animal or vegetable fats and oils and their cleavage products; prepared edible fats; animal or vegetable waxes	0.3%
Glass and glasswareGlass and glassware	0.3%
Essential oils and resinoids; perfumery, cosmetic...Essential oils and resinoids; perfumery, cosmetic or toilet preparations	0.3%
Aircraft, spacecraft, and parts thereofAircraft, spacecraft, and parts thereof	0.3%
Beverages, spirits and vinegarBeverages, spirits and vinegar	0.3%
Zinc and articles thereofZinc and articles thereof	0.2%
Raw hides and skins (other than furskins) and...Raw hides and skins (other than furskins) and leather	0.2%
Ceramic productsCeramic products	0.2%
Wool, fine or coarse animal hair; horsehair yarn...Wool, fine or coarse animal hair; horsehair yarn and woven fabric	0.2%
Man-made filamentsMan-made filaments	0.2%
Soap, organic surface-active agents, washing...Soap, organic surface-active agents, washing preparations, lubricating preparations, artificial waxes, prepared waxes, polishing or scouring preparations, candles and similar articles, modelling pastes, 'dental waxes' and dental preparations with a basis of plaster	0.2%
Residues and waste from the food industries;...Residues and waste from the food industries; prepared animal fodder	0.2%
Tanning or dyeing extracts; tannins and their...Tanning or dyeing extracts; tannins and their derivatives; dyes, pigments and other colouring matter; paints and varnishes; putty and other mastics; inks	0.2%
Tools, implements, cutlery, spoons and forks, of...Tools, implements, cutlery, spoons and forks, of base metal; parts thereof of base metal	0.2%
SilkSilk	0.2%
Wadding, felt and nonwovens; special yarns; twine,...Wadding, felt and nonwovens; special yarns; twine, cordage, ropes and cables and articles thereof	0.1%
Preparations of cereals, flour, starch or milk;...Preparations of cereals, flour, starch or milk; pastrycooks' products	0.1%
Lead and articles thereofLead and articles thereof	0.1%
Impregnated, coated, covered or laminated textile...Impregnated, coated, covered or laminated textile fabrics; textile articles of a kind suitable for industrial use	0.1%
Dairy produce; birds' eggs; natural honey; edible...Dairy produce; birds' eggs; natural honey; edible products of animal origin, not elsewhere specified or included	0.1%
Ores, slag and ashOres, slag and ash	0.1%
Miscellaneous edible preparationsMiscellaneous edible preparations	0.1%
CottonCotton	0.1%
Preparations of meat, of fish or of crustaceans,...Preparations of meat, of fish or of crustaceans, molluscs or other aquatic invertebrates	0.1%
Edible vegetables and certain roots and tubersEdible vegetables and certain roots and tubers	0.1%
Meat and edible meat offalMeat and edible meat offal	0.1%
Special woven fabrics; tufted textile fabrics;...Special woven fabrics; tufted textile fabrics; lace; tapestries; trimmings; embroidery	0.1%
See more products	51.7%

Main imports (% of imports)	2008
Mineral fuels, mineral oils and products of their...Mineral fuels, mineral oils and products of their distillation; bituminous substances; mineral waxes	12.6%
Nuclear reactors, boilers, machinery and...Nuclear reactors, boilers, machinery and mechanical appliances; parts thereof	12.5%
Vehicles other than railway or tramway...Vehicles other than railway or tramway rolling-stock, and parts and accessories thereof	11.4%
Electrical machinery and equipment and parts...Electrical machinery and equipment and parts thereof; sound recorders and reproducers, television image and sound recorders and reproducers, and parts and accessories of such articles	10.8%
Iron and steelIron and steel	4.8%
Plastics and articles thereofPlastics and articles thereof	4.2%
Articles of iron or steelArticles of iron or steel	3.3%
Pharmaceutical productsPharmaceutical products	3.1%
Optical, photographic, cinematographic, measuring,...Optical, photographic, cinematographic, measuring, checking, precision, medical or surgical instruments and apparatus; parts and accessories thereof	1.4%
Rubber and articles thereofRubber and articles thereof	1.4%
Paper and paperboard; articles of paper pulp, of...Paper and paperboard; articles of paper pulp, of paper or of paperboard	1.4%
Furniture; bedding, mattresses, mattress supports,...Furniture; bedding, mattresses, mattress supports, cushions and similar stuffed furnishings; lamps and lighting fittings, not elsewhere specified or included; illuminated signs, illuminated name-plates and the like; prefabricated buildings	1.3%
Meat and edible meat offalMeat and edible meat offal	1.2%
Miscellaneous chemical productsMiscellaneous chemical products	1.0%
Wood and articles of wood; wood charcoalWood and articles of wood; wood charcoal	1.0%
Organic chemicalsOrganic chemicals	1.0%
Raw hides and skins (other than furskins) and...Raw hides and skins (other than furskins) and leather	1.0%
Aluminium and articles thereofAluminium and articles thereof	0.9%
Footwear, gaiters and the like; parts of such...Footwear, gaiters and the like; parts of such articles	0.9%
Ores, slag and ashOres, slag and ash	0.9%
CottonCotton	0.8%
Copper and articles thereofCopper and articles thereof	0.8%
Essential oils and resinoids; perfumery, cosmetic...Essential oils and resinoids; perfumery, cosmetic or toilet preparations	0.8%
Articles of apparel and clothing accessories, not...Articles of apparel and clothing accessories, not knitted or crocheted	0.8%
Ceramic productsCeramic products	0.7%
Man-made filamentsMan-made filaments	0.7%
Miscellaneous articles of base metalMiscellaneous articles of base metal	0.7%
Man-made staple fibresMan-made staple fibres	0.6%
Articles of apparel and clothing accessories,...Articles of apparel and clothing accessories, knitted or crocheted	0.6%
Tanning or dyeing extracts; tannins and their...Tanning or dyeing extracts; tannins and their derivatives; dyes, pigments and other colouring matter; paints and varnishes; putty and other mastics; inks	0.6%
Glass and glasswareGlass and glassware	0.6%
Inorganic chemicals; organic or inorganic...Inorganic chemicals; organic or inorganic compounds of precious metals, of rare-earth metals, of radioactive elements or of isotopes	0.6%
Articles of stone, plaster, cement, asbestos, mica...Articles of stone, plaster, cement, asbestos, mica or similar materials	0.5%
CerealsCereals	0.5%
Soap, organic surface-active agents, washing...Soap, organic surface-active agents, washing preparations, lubricating preparations, artificial waxes, prepared waxes, polishing or scouring preparations, candles and similar articles, modelling pastes, 'dental waxes' and dental preparations with a basis of plaster	0.5%
Wool, fine or coarse animal hair; horsehair yarn...Wool, fine or coarse animal hair; horsehair yarn and woven fabric	0.5%
Miscellaneous edible preparationsMiscellaneous edible preparations	0.5%
Impregnated, coated, covered or laminated textile...Impregnated, coated, covered or laminated textile fabrics; textile articles of a kind suitable for industrial use	0.5%
Toys, games and sports requisites; parts and...Toys, games and sports requisites; parts and accessories thereof	0.5%
Edible fruit and nuts; peel of citrus fruits or...Edible fruit and nuts; peel of citrus fruits or melons	0.4%
Railway or tramway locomotives, rolling-stock and...Railway or tramway locomotives, rolling-stock and parts thereof; railway or tramway track fixtures and fittings and parts thereof; mechanical (including electro-mechanical) traffic signalling equipment of all kinds	0.4%
Sugars and sugar confectionerySugars and sugar confectionery	0.4%
Beverages, spirits and vinegarBeverages, spirits and vinegar	0.4%
Residues and waste from the food industries;...Residues and waste from the food industries; prepared animal fodder	0.4%
Animal or vegetable fats and oils and their...Animal or vegetable fats and oils and their cleavage products; prepared edible fats; animal or vegetable waxes	0.4%
Tools, implements, cutlery, spoons and forks, of...Tools, implements, cutlery, spoons and forks, of base metal; parts thereof of base metal	0.4%
Salt; sulphur; earths and stone; plastering...Salt; sulphur; earths and stone; plastering materials, lime and cement	0.4%
Dairy produce; birds' eggs; natural honey; edible...Dairy produce; birds' eggs; natural honey; edible products of animal origin, not elsewhere specified or included	0.4%
Oil seeds and oleaginous fruits; miscellaneous...Oil seeds and oleaginous fruits; miscellaneous grains, seeds and fruit; industrial or medicinal plants; straw and fodder	0.3%
Knitted or crocheted fabricsKnitted or crocheted fabrics	0.3%
Preparations of cereals, flour, starch or milk;...Preparations of cereals, flour, starch or milk; pastrycooks' products	0.3%
Preparations of vegetables, fruit, nuts or other...Preparations of vegetables, fruit, nuts or other parts of plants	0.3%
Tobacco and manufactured tobacco substitutesTobacco and manufactured tobacco substitutes	0.3%
Other made-up textile articles; sets; worn...Other made-up textile articles; sets; worn clothing and worn textile articles; rags	0.3%
Miscellaneous manufactured articlesMiscellaneous manufactured articles	0.3%
Special woven fabrics; tufted textile fabrics;...Special woven fabrics; tufted textile fabrics; lace; tapestries; trimmings; embroidery	0.3%
FertilizersFertilizers	0.3%
Edible vegetables and certain roots and tubersEdible vegetables and certain roots and tubers	0.3%
Printed books, newspapers, pictures and other...Printed books, newspapers, pictures and other products of the printing industry; manuscripts, typescripts and plans	0.3%
Aircraft, spacecraft, and parts thereofAircraft, spacecraft, and parts thereof	0.2%
Wadding, felt and nonwovens; special yarns; twine,...Wadding, felt and nonwovens; special yarns; twine, cordage, ropes and cables and articles thereof	0.2%
Articles of leather; saddlery and harness; travel...Articles of leather; saddlery and harness; travel goods, handbags and similar containers; articles of animal gut (other than silkworm gut)	0.2%
Products of the milling industry; malt; starches;...Products of the milling industry; malt; starches; inulin; wheat gluten	0.2%
Coffee, tea, maté and spicesCoffee, tea, maté and spices	0.2%
Cocoa and cocoa preparationsCocoa and cocoa preparations	0.2%
Fish and crustaceans, molluscs and other aquatic...Fish and crustaceans, molluscs and other aquatic invertebrates	0.2%
Albuminoidal substances; modified starches; glues;...Albuminoidal substances; modified starches; glues; enzymes	0.2%
Live animalsLive animals	0.2%
Live trees and other plants; bulbs, roots and the...Live trees and other plants; bulbs, roots and the like; cut flowers and ornamental foliage	0.1%
Preparations of meat, of fish or of crustaceans,...Preparations of meat, of fish or of crustaceans, molluscs or other aquatic invertebrates	0.1%
Carpets and other textile floor coveringsCarpets and other textile floor coverings	0.1%
SilkSilk	0.1%
See more products	47.8%

Source: Comtrade

See more products: More imports (Intracen Data)
More exports (Intracen Data)

Sources of general economic information

Ministries: Romanian Ministry of the Economy and Finance
Statistical Office: National Institute of Romanian Statistics
Central Bank: National Bank of Romania
Stock Exchange: Bucharest Stock Exchange
Search Engines: Rol
Cautare Avansata
Romanian Voice
Economic portals: Portal Info
Afacerinet

Political outline

Executive Power: The president is the head of state and is elected by universal suffrage for a term of five years. The president is also the commander in chief of the army and responsible for protecting the constitution. Under the Romanian constitution, the president acts as a mediator between the various centers of power in the country. The Prime Minister is appointed by the President (and is usually the leader of the majority party) for a term of four years. The Prime Minister is the head of government and holds executive power, including law enforcement and management of the affairs of the country. The Council of Ministers is appointed by the Prime Minister.
Legislative Power: The legislature in Romania is bicameral. The Parliament consists of: Senate (the upper house) having 137 seats and the Chamber of Deputies (the lower house) having 332 seats. The members of both the houses are elected by direct, popular vote on a proportional representation basis to serve four-year terms. The executive branch of government is directly or indirectly dependent on the support of the parliament, often expressed through a vote of confidence. Prime Minister does not have the power to dissolve the Parliament directly, but President can do so after consultation with the political parties represented in the Parliamnet.The people of Romania have considerable political rights.
Main political parties: Romania has a multi-party system in which the parties usually agree to form coalition governments. The country's main parties are: - The PSD (Social Democrat Party) - which follows the social democratic ideology, - The PNL (National Liberal Party) - advocates liberalism, both economic and social - The PD (Democratic Party ) - follows the ideology of the center-right - PC (Conservative Party) - advocates family values and nationalism, without chauvinism, - The PRM (Party of Great Romania) - is nationalist extreme right.
Current political leaders: President: Traian Basescu (2004-present)-Democratic Party
Prime Minister:Emil BOC (since 22 December 2008)
Next election dates: Presidential elections: November-December 2009
Election for the Chamber of Deputies: November 2012
Senatorial elections: November 2012

Indicator of freedom of the press

World Rank:: 50/173
Evolution:: 8 places down compared to 2007

Source: Worldwide Press Freedom Index 2007, Reporters Without Borders

Indicator of political freedom

Ranking:: Free
Political freedom:: 2/7
Civil liberties:: 2/7

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