Export growth in several EU member states from the Central and Eastern Europe region outstripped growth in China both before and after the recent global economic crisis, the World Bank’s latest Europe and Central Asia Economic Update shows.
Romania was the region’s leader in export growth in the six years after the crisis, with annual export growth averaging 9% in Southeast Europe’s largest economy. At an average of 7% per year, export growth in Lithuania, Poland, and Slovakia also outstripped China’s average rate of 4%.
Bulgaria, Czechia, Estonia, Hungary, Latvia and Slovenia also saw faster post-crisis export growth than the East Asian superpower.
“The export success of Central European countries has been remarkable over an even longer period. It compares favorably with export performance in China,” says the World Bank report.
“The unweighted annual average of the growth of exports of goods and services (in volume terms) of EU accession countries was 11% in the six years before the global financial crisis, compared with 12% for China. Four countries— Bulgaria, the Czech Republic, Hungary, and the Slovak Republic—registered stronger growth than China.”
This is part of a wider picture showing that the Europe and Central Asia (ECA) region is “outperforming the rest of the world in exports,” according to the bank.
In July 2017, the volume of industrial production in ECA was 4.2% above its level a year earlier, which is well above the annual average 1.5% growth since 2000. This is lower than in China, where industrial production has accelerated by 6.2% over the last 12 months (which is just half China’s average annual growth rate since 2000), but above the rate in the rest of the world excluding ECA and China, where industrial production rose 3.2% during the 12 months ending July 2017, up from the long-term annual growth rate of 1.2%.
Chinese investors are increasingly looking to Southeast Europe, not just as a source of lucrative transport and energy infrastructure construction contracts, but for investments into industrial exporters. Key deals in this area include Chinese HBIS’s acquisition of Serbia’s only steel mill Zelezara Smederevo, one of the country’s top exporters. While global merchandise exports increased 7% in the 12 months ending July 2017, exports originating in ECA countries grew by 7.8%.
“These numbers are important for two reasons. First, global export growth is now faster than any year since 2010, when exports rebounded from the unprecedented collapse in 2009. Second, ECA’s exports are outperforming exports from other parts of the world,” says the report.
“ECA’s export performance over the last three years is even more striking, with average annual growth of 5.2%, compared with 1.6% export growth in the rest of the world,” it adds, partly attributing this development to the weakening of the euro following the start of quantitative easing by the European Central Bank in January 2015.