Romania’s industry returns to pre-crisis maximum, but some sectors may never recover

Romania’s industrial production index soared by 68% on an annual basis in April, an expected correction after one-third of the industry stopped operating in April 2020 amid lockdown.

The correction brought the overall industrial output this April 3.1% above that of April 2019 - the equivalent of a tinny 1.5% annual advance. But Romania’s industry entered the coronavirus crisis in decreasing mode: -4.4% YoY in the last quarter of 2019 after negative growth rates during the whole second half of the year. Therefore the 24-month recovery seen this April is really good news.

Looking to the core manufacturing industries, the two-year advance was slightly softer (+2.4%) yet positive and significant.

On an annual basis, the manufacturing sector’s output was 86% stronger in April.

For some industries, the shock was tougher than for others - and the recovery rate was very diverse among sectors.

In general, the light industry suffered losses again after the rising labour cost squeezed the profit margins driving the investors to countries in an earlier development stage.

As of April, the output in such industries was at least one-fifth smaller than a couple of years earlier. Industries such as construction materials or plastic processing gained more than 10% over the past two years while the highest rising ones (electric and electronic parts, other transport means than cars - meaning buses, for instance) added more than 20% to their output two years earlier.

(Photo source: Pixabay.com)