Romania’s C/A gap to widen the next years until exports grow and narrow it down

Romania’s situation is no different than other countries which joined the European Union in 2004, Banca Comerciala Romana executive president, Manfred Wimmer said.

Despite a steep widening of the current account deficit to 14 percent of GDP, massive foreign investments in the Romanian economy will pave the way to significant development and push up exports, Wimmer said. He added the country owns enough resources to cover the trade balance deficit.

Some 40 percent of the gap is covered with foreign direct investments, coupled with the skyrocketing inflows from Romanian workers abroad, which total some 6 billion euros.

FDI in the first ten months of the year lowered 25.3 percent to 5.9 billion euros, versus the same period last year when they stood at 7.9 billion euros, after Austrian-based Erste took over the majority stake in Romania’s BCR.

Wimmer pointed perils which lay ahead in the Romanian economy, according to foreign rating agencies and the IMF, should not become a threat and generate panic among investors especially since the macroeconomic frame is well painted at the moment.

Romania’s economy is likely to see a 5.8 percent growth this year and 6 percent in 2008, three times faster than that in the Euro zone, estimated to grow 2.1 percent, Wimmer said, pointing to significant gains in the country especially in productivity.

Source: NewsIn