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August 3, 2021

Drastic FDI fall, current account strongly adjusted

The fall of foreign direct investment has been a dramatic one and the current account deficit is being strongly adjusted. The situation is globally applicable. Any new opportunities will only develop in 2010. The crucial thing for us is to achieve stability, otherwise we will miss a number of opportunities. It is still to be seen how Romania will capitalize on an increasing FDI appetite for emergent economies, BCR Chief Economist Lucian Anghel told ‘Ziarul Financiar’, trying to explain the data the Romanian Central Bank (BNR) had recently released, showing a collapse of the FDI down to the minimum of the last four years – EUR 57 M by August. He noted that 2009 had been the most difficult year in terms of capital flows, but that investors will re-orient themselves in 2010. On the other hand, the determining influence upon the reduction of the current account balance has come from the trade balance deficit of EUR 3.9 bln, down 68.6 per cent. After the first eight months of the year, the deficit of the current account of the payment balance was EUR 2.4 bln, less by 78.6 per cent compared with the 2008 period of reference.

Current transfers totalled almost EUR 750 M in August, having dropped to one of the lowest values of the last five years the month before – EUR 120 M. ‘The explanation is the substantial sums from the European Union. Notable money entries from the EU had also been recorded in August of 2008, even more than this year’, ING Bank Chief Economist Nicolae Chidesciuc said.

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