Foreign trade of Romania

=Global trade relations=

Italy is Romania's largest trading partner; two-way trade totalled some $22.6 billion in 2007. The principal Italy exports to Romania include computers, integrated circuits, aircraft parts and other defense equipment, wheat, and automobiles. Romania's chief exports to Italy include cut diamonds, jewelry, integrated circuits, printing machinery, and telecommunications equipment. 2.8% of the country's GDP is derived from Agricultural activity. While Romania imports substantial quantities of grain, it is largely self-sufficient in other agricultural products and food stuffs, due to the fact that food must be regulated for sell in the Romania retail market, and hence imports almost no food products from other countries. Romania imported in 2006 food products of 2.4 billion euros, up almost 20% versus 2005, when the imports were worth slightly more than 2 billion euros. The EU is Romania's main partner in the trade with agri-food products. The exports to this destination represent 64, and the imports from the EU countries represent 54%. Other important partners are the CEFTA countries, Turkey, Republic of Moldova and the USA. [ [http://www.ambbukarest.um.dk/da/menu/Eksportraadgivning/Markedsmuligheder/SidsteNyt/RomaniaImportsAgrifoodProductsOf24BnEurosIn2006.htm Romania imports agri-food products of 2.4 bn euros in 2006 - Danmarks ambassade Bukarest ] ]

Romania is one of the world's major exporters of military equipment, accounting for 3-4% of the world total in 2007. EU members are represented by a single official at the WTO.

Balance of payments

Current account balance:$-14.000 billion (2007 est.)

Foreign direct investment

(FDI) in Romania has increased dramatically. In 2006 net foreign direct investment was inbound US$12 billion (EUR 9.1 billion). Cheap and skilled labor force, low taxes, a 16% flat tax for corporations and individuals, no dividend taxes, liberal labor code and a favorable geographical location are Romania's main advantages for foreign investors. FDI has grown by 600% since 2000 to around $13.6 billion or $2,540 per capita by the end of 2004.In October 2005 new investment stimuli introduced – more favorable conditions to IT and research centers, especially to be located in the east part of the country (where is more unemployment), to bring more added value and not to be logistically demanding.

Origin of direct foreign investment 1996-2005 – the Netherlands 24.3%; Germany 19.4%, Austria 14.1%; Italy 7.5%, United States (8th largest investor) 4.0%. Top investors from countries, by companies: Erste Bank (Austria), OMV (Austria), Gaz de France (France), Orange (France), Vodafone (U.K.), Ford (U.S.A.), MOL (Hungary), ENEL (Italy), E.ON (Germany), Nokia (Finland) ... General Motors considers Romania for plant [ [http://www.zf.ro/articol_137986/general_motors_considers_romania_for_plant.html General Motors considers Romania for plant | ZF English | Ziarul Financiar ] ] . General Motors could shortly begin investments in order to develop a production centre in Romania, with Cluj-Napoca as a potential location for the future plant, close to the Nokia Village. Nokia invested $100 mn in a plant near Cluj-Napoca. [ [http://www.kauppapolitiikka.fi/netcomm/news/showarticle.asp?intNWSAID=65016 Kauppapolitiikka ] ] SABMiller is set to invest EUR50m (US$69m) in expanding production at one of its breweries in Romania (Ursus (beer)). [ [http://www.just-drinks.com/article.aspx?id=91494 ROMANIA: SABMiller lines up Ursus investment: Beverage News & Comment ] ] Czech-based investor and developer CTP Invest plans to allocate EUR 60 mln next year in industrial property development in Romania. [ [http://www.propertyxpress.com/getnews/0000003173 CTP Invest to Allocate EUR 60 mln for Romania // Property Xpress ] ] Snowmobile and motorcycle maker Polaris Industries Inc. will invest 50 million euros ($69.41 million) in a snowmobile plant in Romania. [ [http://www.reuters.com/article/tnBasicIndustries-SP/idUSL1480867120070914 Polaris to build snowmobile plant in SE Europe | Reuters ] ] British investments in the Romanian economy currently exceed 5 billion euros, with more than 3,200 British companies operating in key sectors, including telecommunications, information technology, financial services, and water and environmental protection. [http://www.setimes.com/cocoon/setimes/xhtml/en_GB/features/setimes/features/2007/12/06/feature-01 British investments in the Romanian economy currently exceed 5 billion euros, with more than 3,200 British companies operating in key sectors, including telecommunications, information technology, financial services, and water and environmental protection.]

Sectors of direct foreign investment - industry 38.4%; banking and insurance 22.2%; wholesale and retail trade 13.1%; production of electricity, gas and water 10.5%; transportation and telecommunications 9.2%. Foreign capital is attracted by skilled and relatively inexpensive labor, tax incentives, modern infrastructure, and a good telecommunications system. Romania has strength in information technology and other significant areas such as auto components, chemicals, apparels, pharmaceuticals and jewellery.

Romanian investments abroad

Romanian furniture chain opens hypermarket in Bulgaria's capital. Romanian furniture company Mobexpert opened its first hypermarket in Bulgaria in Sofia's residential district of Lyulin. Ten million euro was invested, of which 80 per cent were provided as a bank credit from Alpha Bank. [ [http://www.sofiaecho.com/article/romanian-furniture-chain-opens-hypermarket-in-bulgarias-capital/id_24973/catid_67 Romanian Furniture Chain Opens Hypermarket In Bulgaria'S Capital - Business News ] ] Annual profit of Mobexpert's hypermarkets was 200 million euro. The company has 4500 employees. The Romanian electronics producer Altex, which is considered the largest one in the country, plans to enter the Bulgarian market in 2008. [ [http://www.sofiaecho.com/article/largest-romanias-electronic-company-enters-bulgaria/id_24663/catid_67 Largest Romania’S Electronic Company Enters Bulgaria - Business News ] ] Altex has 90 stores in Romania's largest cities. In Bucharest alone there are ten stores. The company previously announced its plans to enter the Serbian market as well. Romanian sanitary and electric equipment distributor Romstal has entered the Serbian market, acquiring local equipment distributor Doming for 10 million euro ($14.7 million). [http://www.seenews.com/news/latestnews/romania___sromstalentersserbia_buyslocalcodomingfor10mlneuro-144259/ Romanian sanitary and electric equipment distributor Romstal has entered the Serbian market, acquiring local equipment distributor Doming for 10 million euro ($14.7 million]

References