In S1 2008 economy increased by 8,8% and wages by 3,3%

Lately Romania breaks records after records: economical growth unwitnessed since the period of communism, huge currency reserves, unexpected values added to the budget, increase for the retail sales etc. And are not the only ones. To just one chapter we aren’t on a good position (exactly the one that matters most for citizens): the living standard.

Romania’s economical growth for the second quarter and for the first semester of the current year exceeded any expectations, the ones of the economic analysts, and even the expectations of the Minister of Economy and Finance, Varujan Vosganian. According to the latest data supplied by the National Institute of Statistics, published last week, the real economic increase for the first quarter recorded significantly increases against the similar period from 2007, to 8,8%, and the one of the second quarter to 9,3%, both values representing record levels for Romania. In current prices, the Gross Domestic Product (GDP) estimated for the first semester was 195,76 billion lei and for the second quarter 109,01 billion lei. A week before, the minister of economy and finance, Varujan Vosganian, estimated that Romania’s economy has increased with 8,6% in the first semester of 2008, in terms in which in the second quarter the gross domestic product (GDP) would have been of 8,9%. “The economical growth didn’t reach to this level since the communist period, but we can’t make a comparison with that period because then there were used other indexes”, Vosganian explained. The National Institute of Statistics disposes of quarterly data starting with 1998, but since 1990 till that moment, Romania either had an economical drop or the progress was reduced. The old record in what concerns the evolution of GDP at semester level was recorded in the first six months of 2006, of 7,4%, and at quarterly level in the interval April-June 2006, of 7,9%.

The record registered in the second quarter propelled Romania in the top of the economical growth not just from the European Union, but also against other developed states. According to Eurostat, in the second quarter, Romania’s economy increased six times faster then the average of the European Union (EU), comparative with the same period of last year, the medium evolution of the EU’s member states being of 1,6%. The difference against the second position, occupied by Slovakia, is quite big, of 1,7 percentage points. The most important economies from the euro zone – Germany, France and Italy – have recorded even decreases of the GDP, of below one percentage point, in the second quarter against the interval January – March. More than that, in the United States, the GDP increased with only 0,8% in the second quarter against the first one and with 2,2% against the similar period of 2007, while Japan recorded an economical increase of 1%. However, the economic analysts consider this historical progress is an unsustainable one, based on volatile sectors, as constructions and agriculture, and that in real terms things aren’t so good. “In my opinion, the reality is distorted and the growth is generated by the volatile sectors, with a reduced economical performance”, Ionut Dumitru, chief of the research department within Raiffeisen Bank stated. The ING analysts consider that both the investments and the private consumption are maintaining at high levels.

Another record was established the other days by the National Bank of Romania which announced that its currency reserves are close to about 26 billion euro. So, according to BNR’s data, the currency reserves increased in August with 682 million lei, up to 25,92 billion euro. The increase was mainly determined by inputs of 1,864 billion euro, representing the change of the minimum reserves in currency set up by the credit institutions, the supply of the European Commission’s account, incomes derived from the administration of the international reserves but there have also been outflows of 1,182 billion euro, representing the change of the minimum reserves in currency set up by the credit institutions, payments of installments and interests afferent to the direct and guaranteed by state foreign public debts and payments towards the European Commission. The gold reserve maintained to 103,7 tons, but because of the international quotations its value dropped to 1,893 billion. The total of the BNR’s reserves, currency plus gold, is situated to 27,813 billion euro.

Another record was grounded in what concerns the budgetary returns recorded on July.

So, according to the president of the National Agency of Fiscal Administration, Daniel Chitoiu, the public revenues on July represented a record of the last 20 years. Otherwise, in the first seven months of the year were collected to the consolidated public budget 90,64 billion lei, with 35,35% more than in the similar period of last year and represents 54% of the total foreseen for the entire year.

That in Romania the consumption represents a main element for the economical increase it is proved by the last statistics of Eurostat, according to which our country had the most significant increase for the retail sales on July at the level of EU. So, against to the similar period from 2007, Romania recorded an increase of 18,4%, almost triple against the next ranked, Slovakia, in which was grounded an advance of retail of 6,8%. At the level of the European Union the sales have dropped, on an average with 1,1% against the corresponding period of the previous year, while in countries as Luxembourg and Spain, the drops were of about 6%. In Latvia, the retail sales had a decline of 8,5%, the biggest from the EU.

The most optimistic officials, the minister of Economy and Finance, Varujan Vosganian and the premier Calin Popescu Tariceanu, see Romania even better positioned in the next years. So, Vosganian estimates that in 2012 the GDP of Romania could reach to 250 billion euro from about 121 billion euro (404,7 billion lei) last year, in the context in which the National Commission of Prognosis estimates for 2012 a GDP of 233 billion euro. “Till 2012, Romania will step in the first half of the European countries as dimension of the gross domestic product. Till 2020 we want to reach to a GDP of 440-450 billion euro, being in the first nine-ten countries from the EU”, Vosganian said.

The prime minister Calin Popescu Tariceanu adds that till 2014, Romania could reach among the first seven-eight Europe’s economical powers. All these statistics and statements come in the context in which Romania keeps on being on the last but one position in the European Union in what regards the living standard, the last classified being Bulgaria.

On the other hand, the annual rate of inflation recorded in July a record of the last three years, reaching to a level of 9,04%. Since the end of last year till July 2008, the inflation increased with 4,28%, according to NIS. Inflation however hits where Romanians are the most affected: the increase of wage. So, if in July 2008, comparative with the same month of last year, the increase of the net average wage was of almost 26%, the real growth proves to be of only 15,4%. Reported to the first semester of this year, the wage increase is even smaller. Nominal, on June the net average wage increased against January by 6%, from 1.200 lei to 1.273 lei. In real terms, the increase was even smaller. So, on June, the real wage increase, calculated as report between the net nominal wage gain and the consumption price index was against January of only 3,3%. During the first quarter, the gross minimum wage was situated to 500 lei –about 140 euro, occupying the last but one position at the EU’s level, a smaller minimum wage being only in Bulgaria. Against October 1990, the real wage gain was on July 2008 of 24,8%.

According to some recently statistics made public within World Water Week, carried on Stockholm, in the EU 20 million people don’t have access to a toilet with current water, among which 10 million are found in Romania. Also in our country only 15% from the rural population is connected to the distribution networks of drinking water.

In the report on 2007-2008 concerning the human development, carried out by the United Nations Development Programme, according to the data since 2005, Romania is ranked on the 60 position, with an index of the human development of 0,813, being on the last position within the member states of the European Union.

Our country is ranked six positions under Bulgaria in the world top and with 15 positions under Lithuania. Before our country were ranked countries such as Costa Rica, Bahamas, Cuba, Tonga, Libya and Trinidad – Tobago.