Romania’s industry close to positive growth in September

Romania’s industry close to positive growth in September
By bne IntelliNews November 13, 2020

Romania's industrial production returned in September to the same level seen in the same month last year, while the manufacturing sector's output increased marginally by 0.4% y/y.

This was the best annual performance after 15 months of negative growth rates.

For the entire third quarter, industrial production contracted by 3.4% y/y, but this was a visible improvement from the 26.7% y/y plunge seen in Q2.

The industrial output also rose by 7.4% q/q in seasonally adjusted terms, after the 15% plunge in Q2.

The quarterly data indicate a partial recovery in Q3 after Q2 — while the short-term series indicates a nearly complete recovery as of September, compared to the situation before the crisis (February).

Under a combination of a tight labour market, a shift to higher value-added production segments and sluggish external demand, Romania's industrial production started to decline in mid-2019, a trend that accelerated during the crisis months of April-May.

The post-crisis recovery began in June. In September, the overall industrial production (extractive, manufacturing, and utilities) was only 4.4% lower compared to February in seasonally adjusted terms. In the manufacturing sector, the lag is only 3.9%, so overall production nearly returned to the pre-crisis level.

However, there are wide variations across manufacturing industries. Production of pharmaceuticals surged by 25% year-on-year, the chemical industry posted a robust 14% y/y growth as well, and even the automobile production advanced by 9% y/y as of September. Overall, the production of durable consumer goods thrived (+12.9%), in contrast to the 4.9% decline in the production of non-durable consumer goods.