The development of agriculture and the food industry would diminish significantly important vulnerabilities of the local economy, namely high levels of the budget deficit and the current account deficit, which have not appeared as a consequence of the crisis, but were revealed by the COVID-19 pandemic, claims the deputy governor of the National Bank of Romania (BNR), Leonardo Badea.
From the perspective of the foreign balance there are many domains of the economy in which Romania “must act with priority to diminish the high dependency to imports and stimulation of exports,” believes Leonardo Badea, mentioning that for two of these domains recently a very important step was made which, unfortunately, in the context of an intensification of the health crisis, was too quickly put in the background.
“We are speaking of the agricultural sector and that of the food industry, for which, at the level of the National Committee for Macroprudential Oversight (CNSM), there was work done in the first six months of this year in a multidisciplinary specialist group in view of elaborating a set of actions to diminish the commercial balance deficit in food items. I believe this step is one of the most positive recent examples of cooperation of the relevant factors of the state and the private environment in view of identifying and applying solutions to consolidate the local economy, and the moment is an extremely favorable one because it allows for the channeling and capitalization of resources mobilized at the national and European level to overcome the crisis generated by the COVID-19 pandemic by two domains of strategic interest for Romania,” the quoted source explains on OpiniiBNR.ro.
In Romania, the stimulation of consumption together with an internal offer rigid in terms of structure and in many cases non-competitive by price or quality led to the accelerated increase of net imports and implicitly to the deepening of the commercial balance deficit, including in what regards commerce with food items. For example, in the 2013-2019 period, in the case of meat, fruit and vegetables deficits increased 2.5 times, in the case of products based on cereal 1.7 times, and in the case of drinks 2.2 times.