Monday, May 12, 2008

Romania’s Q1 trade deficit up

BUCHAREST (Reuters) – Romania’s first-quarter trade deficit grew by 9.4 percent on the year to 4.8 billion euros, showing signs of slower deterioration thanks to stronger exports, data showed yesterday.

The National Statistics Board (INS) said CIF (cost/insurance/ freight) imports rose 12.3 percent year-on-year to 12.8 billion euros, compared with 13.1 percent growth in January-February, while exports were up 13.5 percent versus 19.4 percent in the first two months of the year.

“The first-quarter figures look good,” said Ionut Dumitru, head of research at Raiffeisen Bank in Bucharest.

“There are very high chances to see the current account gap remaining at around 14 percent of the gross domestic product this year if the leu stays around current levels.”

Romania’s current account deficit, fueled by a widening trade gap, has become an economic headache in recent years, sparking talk of risks to the country’s economic stability in the wake of global financial woes.

But export growth appears to have picked up in recent months while imports slowed down on the back of a weaker leu which hit three-year lows against the euro in January.

The trade deficit grew by 47 percent in the first quarter of last year compared with 2006, and stood at 21.5 billion euros in all of 2007.

Central bank Governor Mugur Isarescu said last month the bank needed more time to assess whether the recent pickup in exports was sustainable.

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