Economic trends
Since the early 1990s, successive governments have gradually promoted a liberal economic policy to privatize the state owned companies. In 2006, around 30% of Romania's GDP was generated by domestic firms. Following its accession to the European Union in January 2007, Romania has begun a new phase of economic growth with substantial foreign investments. Like many other countries of the former Soviet bloc, its economy has been transformed into market economy. The GDP has grown at a regular rhythm and a middle class has developed. Romania has become the second most dynamic country of the region after Poland. Inflation has declined from more than 150% in 1997 to less than 5% today. The Romania National Bank has to reinforce its monetary policy due to constant depreciation of its national currency. The unemployment rate is very low, about 4% of its active population. However, even if Romania enjoys a significant potential, notably due to its rich agricultural land and its well-educated and high qualified workforce, it remains one of the poorest countries in Europe with a poverty rate of 6% of the population.
Romania was not spared by the financial crisis. The country has endured a strong decline of economic activity, especially in the automobile sector which depends on foreign purchases and the country has entered into recession in 2009.
Main branches of industry
Agriculture represents almost 7% of the GDP of Romania and employs one fourth of the country's active population. The main resources and agricultural production in Romania are cereals, sugar beets and potatoes. However, the production remains very low in comparison with the the country's potential capacity. About 25% of the country is covered by forest (especially around Transylvania) and the logging industry is developing very fast.
The industrial sector contributes about one third of the country's GDP and employs almost 25% of the active population. Historically, the manufacturing companies and the industrial sectors represent the backbone of Romania's economy. That is why many foreign direct investors have profited from the heavy industry (metallurgy, steel), the manufacturing of vehicle parts, building and construction, petroleum refining and textiles. However, during the last few years, new technologies have been moving forward due to the growth of high qualified workforce whose cost is lower than the European average.
Romania's economy is mainly centered in the service sector, which represents almost 60% of the GDP and employs about half of the nation's workforce. Tourism, in particular, is booming.
International trade
Romanian exports have increased by almost 30% between 2006 and 2008. Imports have followed the same trend but with a volume of about two times higher (an increase of almost 60%). These results show that Romania remains too dependent on imports. The global economical crisis has accentuated the deficit in the balance of payments in 2009, which has reached 12 billion Euros (EUR), meaning an increase of 15% in one year. In addition, Romania's main partners are also in economical difficulties themselves and the level of exports has decreased in a parallel way.
Romania's main commercial partners are Germany, Italy, France and Turkey.
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