Industrial decline sharpens: A W-shaped crisis is more plausible
Publish date: 07-10-2009The industry continues to decline, according to data published by the National Institute of Statistics (INS). Thus, net sales in industry fell by an annual 16.9 percent in August, due to declines in the manufacturing and extractive industries, of 17 and 15.3 percent, respectively.
Month-on-month, net sales in industry dropped 10.5 percent in August, due to a 10.9 percent contraction of business in the manufacturing industry, while the extractive sector rose 0.4 percent. August is the tenth consecutive month of decline in the industry sector, which has been severely affected by the economic crisis.
This extension of the decline worries economists, who tend to believe that the industry may take longer than expected to bounce back. Hopes in previous months are gradually being replaced by fears that the economy could relapse rather than recover, and that we might witness a W-shaped crisis.
Exports of Dacia cars to Germany - the engine of Romanian industry exports - are sliding. Furthermore, a relapse also seems more plausible in other EU countries. "We are not very optimistic. The "Rabla" [Ed. n. - trade-in] program in Germany is almost over, which will reduce Dacia car exports. A W-shaped economic scenario is gaining ground. There are also other factors that could lead to such a situation. There are the political tensions, which will also impact on the budget deficit," Vlad Muscalu, Senior Economist within ING Bank Romania, said.
Latest News:
- Insurance market stagnated in 2013 while GDP chare dropped to 1.3%
- The Romanian Leasing Market as of December 31, 2013
- Millennium Bank reports best results since its launch, helped by stronger banking income and cost cuts
- BCR cheapens First Home loans and lowers interest loans for loans in lei
- Millennium Bank's new Salary account clients receive up to 600 lei bonus and their utility bills' payment
- GarantiBank and Seamless introduce SEQR in Romania: the newest mobile payment solution
- Bancpost telecom services, now provided exclusively by Romtelecom and COSMOTE Romania
- Millennium Bank cards offer discounts in Domo stores
- BCR Supervisory Board reshuffles Management Board
- NBR decide to lower the monetary policy rate to 4.25 percent per annum
- Common appointments in Romtelecom and COSMOTE Romania
- Up to 5.5% annual interest rate for Millennium Bank's promotional three-month lei deposit
- Eurozone in recovery mode but gap between North and South still widening
- UniCredit Tiriac Bank and RBS Romania announce the successful completion of the retail clients' migration
- Millennium Bank grants First House loans in lei