KeysFin: Brexit will have marginal impact on Romania’s economy

The withdrawal of the United Kingdom from the European Union will affect the local economy only marginally, as the UK is Romania’s ninth-biggest trading partner and only the tenth-biggest source of foreign direct investments in the country (2018 data), according to an analysis by local business information provider KeysFin.

Romania’s exports to Britain reached EUR 2.9 billion in 2018 while the imports were EUR 1.7 billion. British direct investments in Romania stood at EUR 1.7 billion at the end of 2018, and around 1,300 Romanian companies were controlled by British investors (over 50% stakes), with a turnover of about RON 20 billion (EUR 4.2 bln) in 2018, according to data compiled by KeysFin.

“In terms of trade, the relatively weak ties with the United Kingdom place Romania among the most protected European economies from the direct impact of Brexit. However, one of the main economic risks that KeysFin sees related to this event is the contagion that could be generated by an uncontrolled process of the UK leaving the European Union. Despite the minimal probability that we give to this scenario, this being undesirable by both parties, the impact on the financial markets could be a major one," said Roxana Popescu, Managing Director of KeysFin.

In contrast to the moderate economic impact, the impact on the Romanians working in the UK might be significant, the analysis shows. Negotiations between the EU and the UK on the free movement of people will continue to be one of the most sensitive issues, along with the free movement of goods.

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