What can Romania do to cope with crisis

Low labor costs could lead to relocations of large producers, while leu depreciation, although with negative impact on consumption, could boost exporters' business.

"Costs are still much lower in emerging countries and I think that many Western-European companies will relocate to these areas to maintain competitiveness, as labor and production costs are lower here," said lender BCR's Chief Economist, Lucian Anghel.

More expensive lending could lead to lower consumption, according to ING Bank Romania's Senior Economist Nicolaie-Alexandru Chidesciuc.

Furthermore, Romania can keep economic growth in the following years, in spite of international crisis, but at a sustainable 5-6 percent level, analysts say. Romania's National Bank (BNR) Governor, Mugur Isarescu, agrees. However, he warned that future governments must not push too hard on economic growth because, at a too high speed, there is a risk of overheating.

Isarescu's comment was a reply to Prime Minister Calin Popescu Tariceanu's report on four years of governing. Tariceanu praised his government for major economic achievements.

BNR governor stresses that future cabinets must focus on infrastructure. Insufficient development of the highway network is the main failure in the 600-page governing report.

Business Standard