Romania's trade gap narrows on less costly primary energy imports

Romania's trade deficit (goods, FOB/CIF) narrowed by 24.5% y/y in Q2 and by 13.9% y/y in H1, while the 12-month deficit calculated at the end of June increased by only 12.3% y/y to EUR 31.95bn, the Statistics Office INS announced.

The nominal GDP is growing, however, faster (+18.9% y/y at end-March latest available data), resulting in a slightly milder deficit-to-GDP ratio: 10.8% as of June 2023, down from 11.4% one year earlier.

As regards the causes of the trade balance nominal improvement in H1 this year, the net import of mineral fuels, chemicals and cars diminished, and the net export of alcohol and tobacco more than doubled in H1 (table).

Lower imports are correlated with subdued industrial activity that hasn't yet picked up despite lower energy prices.

Notably, the trade with food (which includes grains) posted a negative performance (much wider trade gap) as a result of both lower exports (grain glut) and higher imports (robust private consumption).

(Photo: Andrey Kuzmin/ Dreamstime)