Romania overview

Cityscape

In Romania we focus on:

Promoting stability and expanding products in the financial sector. Given the continuing global economic and financial uncertainty, the stability of the financial sector is still at risk. Further development is also required in the areas of leasing and insurance and local capital markets.

Strengthening infrastructure through improved efficiency and greater private sector involvement. It is necessary to develop the national infrastructure sector, especially roads, and, where appropriate, to introduce private sector investment via concessions /PPPs and the privatisation of transport operators. In many infrastructure operations (water, waste, roads, rail, district heating, etc.) there is a need for improved operating efficiency and service levels, and less dependence on public subsidies and state financing.

Restructuring the power sector and increasing energy efficiency and sustainability. A large part of Romania’s energy sector is still state-owned and needs to be restructured and/or privatised to encourage investment and to promote efficiency. Despite improvements in recent years, Romania is still an energy-intensive economy and needs to make further progress in the transition to an efficient, low carbon economy.

As well as being a country where the EBRD works, Romania is also an EBRD donor. In 2015 Romania became a donor to the Eastern Europe Energy Efficiency and Environment Partnership Fund, contributing €40,000 for projects in Moldova.

The EBRD’s latest Romania strategy was adopted on 30 September 2015

Current EBRD forecast for Romania’s Real GDP Growth in 2016 4.8%

Current EBRD forecast for Romania’s Real GDP Growth in 2017 3.7%

Economic growth in Romania accelerated further, from 3.7 per cent in 2015 to 5.2 per cent in the first half of 2016, on the back of domestic demand. The contribution of private consumption to growth was higher than expected, on the back of improved income prospects driven by low inflation and wage hikes, as well as fiscal easing. Consumption will be pushed further up by the wage hike for the entire health sector as of August 2016 and cut in employees’ social security contribution by 2017. Private investments had a positive contribution to growth, on the back of historically low cost of funding and improved industrial confidence and this is likely to continue into 2017. Government spending is likely to remain subdued due to the end of the previous EU-funding period, despite higher staff costs. Meanwhile, slightly improved economic prospects of Romania’s trade partners should support net exports. Overall, growth is expected to reach 4.8 per cent in 2016, before moderating to 3.7 per cent in 2017.

Romania in the EBRD’s 2016-17 Transition Report

Romania in the latest BEEPS survey