The Volkswagen scandal could cut 0.3 pp of Romania’s GDP growth

The Volkswagen scandal could severely affect Romania’s automotive exports. If the situation worsens next year, it could lead to a 0.3 percentage point decrease in Romania’s economic growth rate, considering that 4 out of 10 car parts that are produced in Romania go to Germany, according to local bank BCR’s analysts, reports local Profit.ro. The German producer has rigged the diesel engine emissions tests in America and Europe. Volkswagen needs to call back in service about 8.5 million diesel cars equipped with devices which help manipulate the environment tests. The Romanian car parts exports to Germany represent about 3% of the total local exports, and 39% of the total car parts exports from Romania. However, it is too early to estimate if the Volkswagen scandal escalates, according to BCR analysts. Most forecasts indicate that Romania’s economy should maintain a growth rate of over 3% next year. editor@romania-insider.com