Defence: 1.9% of GDP.
GDP (2007): $250 billion.
Annual GDP growth rate (2007): 6.1%.
GDP per capita (2007): $11,989.
Natural resources: Oil, timber, natural gas, coal, salt, iron ore.
Agriculture (2007): Percent of GDP: 8.0%. Products: corn, wheat, potatoes, oilseeds, vegetables, livestock, fish, and forestry.
Industry (2007): Percent of GDP: 23.9%. Types: machine building, mining, construction materials, metal production and processing, chemicals, food processing, textiles, clothing.
Services (2007): Percent of GDP: 61.1%.
Construction (2007): Percent of GDP: 7.0%.
Trade: Exports (2007): $32.3 billion. Types: textiles, chemicals, light manufactures, wood products, fuels, processed metals, machinery and equipment. Major markets: Italy, Germany, Turkey, France, Hungary, U.K., U.S. (2.6%). Imports (2007): $50.9 billion. Types: machinery and equipment, textiles, fuel, coking coal, iron ore, machinery and equipment, and mineral products. Major suppliers: Germany, Italy, Russia, France, Turkey, Austria, U.K., China, Hungary, U.S. (2.4%).
Exchange rate: 2.38 new Lei=U.S. $1 (end-October 2007).
With a GDP of around $250 billion and a GDP per capita (PPP) of $11,989 estimated for 2008, Romania is considered an upper-middle income economy and has been part of the European Union since January 1, 2007. After the Communist regime was overthrown in late 1989, the country experienced a decade of economic instability and decline, led in part by an obsolete industrial base and a lack of structural reform. From 2000 onwards, however, the Romanian economy was transformed into one of relative macroeconomic stability, characterized by high growth, low unemployment and declining inflation. In 2006, according to the Romanian Statistical Office, GDP growth in real terms was recorded at 7.7%, one of the highest rates in Europe. The growth decreased to 6.1% in 2007, and is expected to be around 5.7% in 2008. Unemployment in Romania was at 3.9% in September 2007 which is very low compared to other European countries such as Poland, France, Germany and Spain. Foreign debt is also comparatively low, at 20.3% of GDP. Exports have increased substantially in the past few years, with a 25% year-on-year rise in exports in the first quarter of 2006. Romania’s main exports are clothing and textiles, industrial machinery, electrical and electronic equipment, metallurgic products, raw materials, cars, military equipment, software, pharmaceuticals, fine chemicals, and agricultural products (fruits, vegetables, and flowers). Trade is mostly withy the other member states of the European Union, with Germany and Italy being the country’s single largest trading partners. The country, however, has a large trade deficit, which increased sharply during 2007 by 50%, to 15 billon Euros.
| Chamber of Commerce - source |
After a series of privatizations and other reforms in the late 1990s and early 2000s, government intervention in the Romanian economy is somewhat lower than in other European economies. In 2005, the government replaced Romania’s progressive tax system with a flat tax of 16% for both personal income and corporate profit, resulting in the country having the lowest fiscal burden in the European Union, a factor which has contributed to the growth of the private sector. The economy is predominantly based on services, which account for 55% of GDP, even though industry and agriculture also have significant contributions, making up 35% and 10% of GDP, respectively. Additionally, 32% of the Romanian population is employed in agriculture and primary production, one of the highest rates in Europe. Since 2000, Romania has attracted increasing amounts of foreign investment, becoming the single largest investment destination in South-eastern and Central Europe. Foreign direct investment was valued at €8.3 billion in 2006. According to a 2006 World Bank report, Romania currently ranks 49th out of 175 economies in the ease of doing business, scoring higher than other countries in the region such as Hungary, Poland and the Czech Republic. Additionally, the same study judged it to be the world’s second-fastest economic reformer in 2006. The average gross wage per month in Romania is 1411 lei as of September 2007, equating to €403.3 (US$597.3) based on international exchange rates, and $1001.1 based on purchasing power parity.