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Cronicile

Foreign trade deficit, concentrated in seven countries. Hungary ranks second, right after China

de Marin Pana , 2.4.2018

Seven countries concentrate 99% of the deficit that Romania registered in foreign trade exchanges in 2017 – according to provisional data published by the National Institute of Statistics.

Surprisingly, while China ranks first, as expected, Hungary holds the second position, at a short distance, and Poland ranks third, with a sixth of the whole deficit.

Somewhat unexpectedly, according to the official data published by INS, our country recorded surpluses last year in relation to France, the United Kingdom and the US. The largest trade partner and the engine of the EU economy, Germany, holds only the ninth position in the top 10 countries in relation to which we have a trade deficit.

Neither the relation with Italy or Spain is too bad, with an import coverage ratio by exports of 96.7% and 96%, respectively.

Therefore, not the economic exchanges with the large European economies are the ones to create problems, but rather those with former colleagues of the socialist bloc, to which we can only export at worryingly low proportions compared to imports (54.3% with Hungary, 49.7% with Poland or 62.5% with Slovakia, interestingly, we are doing somewhat better in relation to the Czech Republic, at 86.4%).

These figures are even lower in relation to two countries from which we are massively importing energy resources (46.5% with Russia, a market on which we cannot perform the same as in relation to large Western economies and only 2.7% with Kazakhstan).

Nor is the Romanian presence on the Chinese market in a situation to help, with exports of only EUR 738.5 million to the largest market in the world.

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  • Top foreign trade partner countries in 2017 (million euro)
  • Country           fob export     CIF import       Balance           %deficit           FOB/FOB coverage

*

While these are somewhat excusable, developments in recent years in relation to two Balkan trade partners are increasingly poorer in the sense that we have moved from surplus to deficit:

The deficit in relation to Bulgaria is not worrying in terms of size but, moreover, as a new thing, but the one in relation to Turkey is quickly moving towards the threshold of one billion euros per year.

Also in the West, smaller economies are those that raise great problems for us, significant deficits in relation to the Netherlands (EUR-1.4 billion at an import coverage ratio by exports of only 55%), Austria (EUR 1.05 billion and 61%, respectively) and Belgium (about EUR 520 million, almost as much as the one for Italy, at a 74% coverage ratio) are worth being pointed out.

To clarify directions to which we should act, beyond the general considerations, it is worth selecting and clearly mentioning the top 10 countries in relation to which we register a trade deficit, of which seven are over one billion euros, both in terms of absolute value in euro and share in total.

Quite bizarre, in this ranking, Slovakia is close to Germany.

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  • Top 10 countries in relation to which we have a trade deficit
  • Country           Balance           deficit (%)

*

Basically, we should start focusing gradually but firmly and more clearly on East and the markets of medium-sized countries, both western ones and those from our geographic proximity.

As well as start analysing how we could lose the surpluses we obtained until recently in the Balkans.

Finally, precisely because of our most significant surplus, the one in relation to the United Kingdom, it seems that we shall have some difficulties following the Brexit.

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