Romania’s foreign trade and deficit both gain momentum in April

Romania’s foreign trade and deficit both gain momentum in April
/ bne IntelliNews
By bne IntelliNews June 11, 2024

Both exports and imports of Romania (chart) increased in April, by 14.8% y/y and 17.8% y/y respectively, as the Easter holiday hit the economic activity in May this year (compared to April in 2023), according to data published by the statistics office. 

The trade deficit widened, accordingly, by 29% y/y – which is more than proportionally and indicates a deterioration in the country’s external balance consistent with the robust domestic demand (retail sales +14.6% y/y in April, private consumption up 3.5% y/y in Q1).

In the 12 months to April, Romania’s exports decreased by 0.8% y/y to €93.3bn as the commodity and industrial prices declined. The dwindling industrial activity also contributed.

The country’s imports in the 12-month period contracted by 3.4% y/y to €122.7bn on lower energy prices (natural gas bill) and subdued industrial activity.

Consequently, the trade deficit in the 12 months to April 2024 contracted by 10.8% y/y to €29.4bn or 9% of GDP compared to 11.2% in April 2023. 

Romania’s trade gap to GDP ratio doubled from 6% in 2016 to 11.9% in 2022 amid various factors including the war in Ukraine (higher energy prices) but eased afterwards to 9.1% as of November 2023 to resume an upward shift driven by domestic demand in the recent period.