Fast Growing Romanian Tourism Industry Shows Steady

According to the USDA Global Agricultural Information Network (GAIN) reports released on Monday, June 24, 2019 fast growing Romanian tourism industry shows steady.

Romania is the European Union’s (EU) tenth-most populous member state and one of its fastest growing economies. According to official data, in the first 11 months of 2018, 12 million people engaged in tourism in Romania, a 6.4-percent increase over the same period in 2017. The Romanian hotel industry has grown by almost 40 percent over the last five years. Consumers are increasingly dining out, and frequently so in urban areas. Mobile devices and internet connectively are driving Romania’s fast-growing food delivery and takeaway segments.

Romania’s real gross domestic product (GDP) growth will slow but continue to grow at a sustainable pace. 2018 real GDP increased by 4.1 percent. 3.7 percent GDP growth is expected for 2019. In real terms, private consumption rose by 5.3 percent in 2018 and gains of 4.8 percent are expected in 2019. Rising wages drives consumer spending, although some gains are offset by higher inflation.

Total agricultural imports in Romania reached
$9 billion in 2018, U.S imports representing
about two percent of Romania’s total
agricultural imports in 2018. Although the U.S.
share remains small, U.S imports increased by
37 percent in 2018, reaching $179 million, up
from $148 million in 2017 (direct and indirect
imports).
The biggest increases in imports in 2018: meat
(7.57 percent); edible fruits and nuts (11.5
percent); baking products (12.6 percent); fish
and seafood (10.6 percent); sauces and
condiments (17 percent); prepared meat and fish
(16 percent); sweet potatoes (23.8 percent).

In 2018 food and drink internet retailing records current value growth of 21 percent to reach RON 263 million ($67.7 million). The hotel industry has grown by almost 40 percent over the last five years with a turnover of over RON 5.5 billion ($1.4 billion) in 2018. As of November 1, 2018, the value-added tax (VAT) was reduced to five percent for accommodations, restaurants and certain sport facilities. Starting January 2019 the minimum wage increased from RON 1,900 ($452) per month to RON 2,080 ($495) and RON 2,350 ($559 – for those with higher education).

Romania joined the EU in 2007. It is the EU’s tenth-most populous member state with 19.7 million inhabitants. Romania’s 2017 GDP reached seven percent, making it one of Europe’s the fastest growing economies. In 2018, real GDP reached 4.1 percent, and 3.7 percent GDP growth is forecast for 2019. Total 2018 Romanian agricultural imports reached $9 billion, with the U.S.-origin imports accounting for about two percent of total imports. Although small, market share for U.S. food and agriculture increased in 2018 by 37 percent to $179 million, a solid increase over $148 million in 2017 (direct and indirect imports).

Romania’s real GDP growth will continue to grow, but at more moderate and sustainable rates. In real terms, 2018 consumer spending rose by 5.3 percent over 2017, and is forecast to grow an additional 4.8 percent in 2019. Rising wages drive consumer spending, although gains are tempered by rising in inflation. Unemployment was 4.2 percent in 2018 and is expected to rise to 4.4 percent in 2019. The monthly minimum wage was increased by 16 percent in 2017 and by an additional nine percent in 2018. On November 1, 2018, Romania reduced its VAT to five percent for hotel rooms, restaurants, and certain sport facilities.

Romanian consumers are increasingly going online to shop. Deeper digital penetration due to the widespread use of hand-held devices and fast connection speeds have driven growth in ecommerce. Internet retail sales between 2012 and 2016 increased by 128 percent in real terms. Sales during that same period from mobile devices increased by 471 percent.

After a period of rapid expansion, real consumer incomes and expenditures are forecast to grow at a more moderate rate by 2030. Still, economic and income growth are forecast to remain above the EU average. Conversely, a declining population and middle class are expected to constrain faster consumer market expansion.

According to the national Institute of Statistics, in the first 11 months of 2018, the number of tourists reached 12 million, up 6.4 percent from the same period of 2017. Of these, 78 percent are Romanian tourists, and 22 percent are foreigners. The hotel industry has grown by almost 40 percent over the last five years, with a turnover of over RON 5.5 billion in 2017. Some estimates for 2018 indicate that the hotel sector reached RON 5.8 billion. Bucharest accounts for over 30 percent of the national hotel market (373 hotels) and over 40 percent of restaurants (2,072 outlets). Constanta is second with 1,043 total hotels and restaurant outlets, followed by Cluj with 768 total outlets, Brasov with 608 total outlets, and Timis with 696 total outlets.

*Source:USDA



Categories: Agirculture, Europe, food, news, Tourism

Tags: , , ,

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