2001	2002	2003	2004	2005	2006	2007	2008 f
GDP EUR in bn	44.33	48.02	50.35	53.50	56.70	61.2	65.3	69.5
GDP growth p.a.	4.2%	4.5%	4.9%	5%	5.2%	7.9%	6.7%	6.5%
Inflation p.a.	10%	12%	13%	9.3%	9.2%	6.56%	4.84%	5.4%
Unemployment	8.8%	8.4%	7.6%	6.7%	6.5%		4.1%
Index of consumer prices (%)	130.3	117.8	114.1	109.3	109.2	106.56	104.84	105.40
FOB exports (EUR in bn)	12.73	14.67	15.61	17.70	18.82	25.85	24.76
CIF imports (EUR in bn)	17.40	18.89	21.20	23.20	24.93	40.75	39.47
Exchange rate (annual average ROL/EUR)	26,026.89	31,255.25	37,555.87	40,532.11	41,200.00	3.52	3.33	3.55
FDI (EUR in bn)	n/a	***1.1	***2.2	***5.0	****6.3	9.08	7

 

Source: National Bank of Romania, National Institute of Statistics
**Source: National Commission for Prognosis
***Source: Colliers
****Source: Wikipedia

According to the requirements of the EU, Romania focused on economic reforms over the past few years. Romania's macroeconomic performance has been favourable with the economy showing a constant growth. Thus GDP growth has been strong and is one of the highest in Central and Eastern Europe.

As a result of the significant progress towards macroeconomic performance, Romania registered an improvement of the business environment and thus the increasing of the foreign direct investment. The foreign investor's interest focused on those industries with a high growth rate, including automotive industry, IT & electronics industry, services, as well as the real estate market.

 

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2007 saw the highest foreign investment level ever and this trend continues. A rise in direct foreign investment allows more jobs to be created, increases transfer of technology and offers training to the labour force. Further more it results in a greater competitiveness on the international market, influences a rise in exports and encourages businesses to produce results that can be subject to profit taxes.

With an increase in profit taxes reinvestment in infrastructure projects, education, health-care and other social programs can be carried out. Romania's recent progress in structural reforms should lead to lasting improvements in public sector finances.

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Romanian economy will continue to show high growth rates in 2008. Moreover, driven by a hawkish and independent monetary policy of the Romanian Central Bank we see improvements in the macro economic picture. Recent interest rate hikes will reduce inflationary pressure and provide support for the RON.

Additionally, the current account deficit is stabilizing, with January already being the second consecutive month with exports exceeding imports. Strong growth of the construction sector (partly financed by EU funds) will continue to drive GDP growth.

 

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The banking sector has also a strong growth potential due to low penetration levels currently and the gap in economic development which will narrow over time. Romania could not have been spared of foreign markets turmoil. At the beginning of this year the local currency depreciated dramatically and a short sore of inflation could be registered.  However the perspectives are not at all black.

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Economic analysts say that the second half of the year will bring a change in trends. Measures taken by the National Bank have already stopped the swift depreciation of the national currency and led to a narrower current account deficit. Moreover the major transnational investors are watching the changes in Romania and recently we have seen the Finnish giant Nokia which entered Romania. Another international company which is ready to invest in Romania is the car manufacturer Ford.