Romania has become the second-largest export market for Hungary and third-largest for Bulgaria in 2017 and is exporting products mainly to the big Western European markets like Germany, Italy and France, Eurostat and National Institute of Statistics (INS) data show. But imports from Hungary and Bulgaria overshadow exports to these markets and Romania posts increasing deficits with its EU-member neighbors.
Due to its large size, Romania has become during the last few years an important market for its neighbors, especially for Moldova, Hungary and Bulgaria.
In 2017, Romania consolidated its position as the largest foreign market for Moldova’s exports. According to Moldova’s National Bureau of Statistics, Romania is by far the main trading partner of Moldova, with 24.8 percent of Moldova’s exports (USD 600.6 million) and 14.4 percent of its imports (USD 694.5 million) in 2017.
But Romania is also a big export market for its two EU-member neighbors – Hungary and Bulgaria.
According to Eurostat, EU’s statistical branch, Romania is Hungary’s second-largest export market, after Germany, with 5 percent of Hungarian exports of goods in 2017.
One of the main source of trade deficits with Hungary is agricultural trade. According to a Hungary’s Ministry of Agriculture report, Romania is the second-largest export market for Hungarian agricultural products, with a share of 12 percent in 2016.
Romania is also Bulgaria’s third-largest export market, after Germany and Italy, with a share of 8 percent of Bulgarian exports.
But Romania is a small exporter to Hungary and Bulgaria, posting a trade deficit of EUR 2.7 billion with Hungary and EUR 54 million with Bulgaria in 2017, according to National Institute of Statistics (INS) data consulted by Business Review.
Official data show Romania’s total exports to Hungary amounted to EUR 2.94 billion last year, but total imports surged to EUR 5.64 billion, while exports to Bulgaria amounted to EUR 2.1 billion, slightly below imports.
Romania’s main export markets are Germany (22.9 percent, EUR 14.4 billion in 2017), Italy (11.2 percent, EUR 7 billion), France (6.8 percent, EUR 4.2 billion), Hungary (4.7 percent) and United Kingdom (4.1 percent, EUR 2.6 billion).
Romania’s imports come mainly from Germany (20 percent, EUR 15.1 billion in 2017), Italy (10 percent, EUR 7.6 billion), Hungary (7.5 percent), Poland (5.4 percent, EUR 4.1 billion) and France (5.3 percent, EUR 4 billion).
Experts estimate imports will continue to outpace exports. “Despite the good external demand, strong private consumption is leading to sizable imports and thus putting pressure on the trade gap,” ING analysts said in a recent report.
Large consumer market
The “final consumption expenditure of households” index, a measure of consumer market, rose from EUR 96.5 billion in 2015 to EUR 104 billion in 2016 and to EUR 114.5 billion in 2017, according to Eurostat statistical series.
Romania is now the 15th consumer market in European Union. The main driver of consumer market growth was the rapid increase of wages recorded in Romania in the last couple of years.
The total amount of wages paid by Romanian employers rose from EUR 57.7 billion in 2016 to a record-level of EUR 67.15 billion in 2017, due to minimum wage and public sector wages’ increases.