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Romania

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EconomicPoliticalStructural

Romania – Quick View
ECR score49.09 (Mar 2011)
ECR rank72 (Mar 2011)
Economic
GDP 2009USD 161,154.90 million
GNI per capita PPPUSD 8,330
FDI inflow 2009USD 18,731.52 million
Inflation 20095.6%
Central bank assets 2010USD 53,903.24 million
Unemployment rate 20106.87%
Government deficit 2010USD 10,474.02 million
Tax revenue 2010USD 29,266.10 million
Political
Government typeRepublic
Recent political crisisNA
Economic freedom score64.7 (63rd)
Freedom of information score16 (52nd)
Corruption perception index 201069th (+2 places)
Structural
Birth rate 200910.4 Births per 000
Population balanceUnder 14 – 14.89%
Population balanceOver 60 – 20%
Life expectancy (Years)Male 69.7
Life expectancy (Years)Female 77.1
Mortality rate 200912 Deaths per 000
Literacy rate97.6%
Internet access 200935.5%

[Top] Economic Overview

The country exports timber, fish, cocoa, copra and palm oil.  It imports mineral fuels, food, machinery and transport equipment. The country’s economy primarily depends on fishing and farming. The economic progress of the country is hampered by inefficient governance, poor infrastructure, political disturbance and business regulations.

(Source: Heritage.org, state.gov)

Gross domestic product (GDP) and GDP growth

Solomon Islands GDP and GDP growth

(Source: worldbank.org,adb.org)

Solomon Islands’ GDP experienced a continual growth from 2006 to 2009. In 2009, GDP amounted to SBD 5.29 billion.

GDP growth rate witnessed fluctuations from 2005 to 2009. In 2009, the rate fell to -2.2% from 7.3% in 2008.

 GNI per capita (PPP)

Solomon Islands GNI per capita, PPP 

(Source: worldbank.org)

In 2009, GNI per capita (PPP) amounted to USD 1,860. In 2010, the country’s GNI per capita (PPP) was registered at USD 2,172.

(Source: undp.org)

Income tax

Highest individual income tax rate in Solomon Islands is 40%.

(Source: Heritage.org)

Corporate tax

The country’s highest corporate tax rate is 30%. However, non-resident corporations are levied a tax of 35%.

(Source: Heritage.org)

 Inflation

The inflation rate for 2009 was recorded at 2.5%. In 2010, inflation was estimated to reach 4.75%.

e = estimatedSolomon Islands Inflation

(Source: adb.org, Econ Stats 

FDI inflow

Foreign Direct Investment (FDI) inflow was USD 173 million in 2009.

(Source: Heritage.org)

Foreign reserves

As of 2011, total foreign reserves amounted to SBD 2,364.9 million in 2009.

(Source: Central Bank)

Central bank assets

In 2009 total assets were SBD 1,396.37 million, as compared to SBD 956.80 million in 2008.

Solomon Islands Central bank assets

(Source: Central Bank)

[Top] Financial Indicators & Government Financial

Consumer price index (CPI)

In Q3 2010, the CPI was affected due to increase in standard VAT from 19% to 24%. In July 2010, the CPI increased above 107%.

(Source: National Bank of Romania: Pg. 12)


Month

Consumer Price Index (CPI)

2009

June

105.86

July

105.06

August

104.96

September

104.94

October

104.30

November

104.65

December

104.74

2010

January

105.20

February

104.49

March

104.20

April

104.28

May

104.42

June

104.38

July

107.14

August

107.58

September

107.77

October

107.88

November

107.73

December

107.96

2011

January

106.99

(Source: National Bank of Romania: Pg. 22)

Industrial producer price index

In 2010, industrial producer price index in Romania is averaged at 106.33, an annual growth of 4.19% over previous year.

Romania Industrial Producer Price Index

 

(Source: National Bank of Romania: Pg. 23)

Interest rates

Interest rates on time deposits and loans increased from 2007 to 2009 and further declined in 2010.

Romania Interest Rates

 

(Source: National Bank of Romania: Pg. 21)

Money supply

Romania has a 3-level money supply arrangement: M1, M2 and M3. M1 includes Currency in Circulation and Overnight Deposits. M2 is the total of M1, term deposits with maturity period of up to and including 2 years. And M3 includes M2, Marketable Securities issued, with maturity of up to and including two years and Money market fund.

In 2010, annual growth rates for money supply indicators M1, M2 and M3 were 2.74%, 5.79% and 6.48% respectively.

 

Romania Money Supply

(Source: National Bank of Romania: Pg. 21)

Government expenditure

Government expenditures in Romania amounted to RON 201,903.6 million in 2010, increase of about 4.39%, compared to 2009. Though expenditures are on rise, the fiscal deficit has declined to RON 33,305.2 million from RON 36,400.6 million in year 2009.

Romania Consolidated Government Expenditure

 

(Source: National Bank of Romania: Pg. 80)

Official exchange rates

In 2010, average exchange rate for Romanian Liu (RON) is 3.1779 per US Dollars (USD) and 4.2099 per Euro.

The average exchange rates from 2005 to 2010 are:


Period

RON / USD

RON / EUR

2005

2.9137

3.6234

2006

2.8090

3.5245

2007

2.4383

3.3373

2008

2.5189

3.6827

2009

3.0493

4.2373

2010

3.1779

4.2099

(Source: National Bank of Romania: Pg. 72)

Government finances

Fiscal balance

Romania Fiscal Balance

 

(Source: National Bank of Romania: Pg. 80)

The Government deficit increased steadily from 2005 to 2009. In 2010, Government deficit was RON 33,305.2 million and in 2009 it was amounted to RON 36,400.6 million.

Total revenue

Government of Romania recorded revenue of RON 168,598.5 million in 2010, an increase of 7.1% over 2009. Major portion of revenue is derived by tax receipts and social contributions made by employers, employees.

(Source: National Bank of Romania: Pg. 80)

 

Romania Government Revenue

(Source: National Bank of Romania: Pg. 80)

Tax revenue

In 2010, tax revenues in Romania were amounted to RON 93,060.1 million, an increase of about 6.9% over 2009. Total tax receipts of Romania include taxes on property, goods, services, imports and income of Individuals and capital gains.

(Source: Ministry of Finance)

Current account balance

Current account shows exports and imports of goods and services, income and expense as well as current transfers in a specified period of time. In 2010, Romania registered current account deficit of EUR 5,158 million and in 2009, it was EUR 4,913 million.

Romania Current Account Balance

 

(Source: National Bank of Romania: Pg. 20)

Balance of payment


Balance of Payment (EUR million)

 

2010

2009

Exports of Goods and Services

37,251

36,148

Imports of Goods and Services

43,115

43,311

Income

-1,960

-1,902

Current transfers

3,412

4,150

Capital and financial account

5,810

5,883

Direct investment

2,437

3,550

Portfolio investment

1,135

516

Other Capital Investment

5,512

2,345

Reserves Assets

-3,488

-1,124

Errors

-652

-969

 

(Source: National Bank of Romania: Pg. 74, 75)

[Top] Labour Force and Employment Overview

The labour force in Romania was recorded at 9.92 million people in 2009 whereas it was 9.94 million in year 2008. Employment Level in economy was 9.24 million for 2009. A continuous rise was recorded during 2006-2008, 2009 seeing employment at its lowest level in the previous 4 years.

(Source: Statistics of Romania:  Page 17)

Employment by type of economic activity

At end of 2009, employment level across all sectors of economic activities has decreased, except agriculture, transportation and health sector, compared to levels in 2008.

 

Economic Activity

Employment ('000 persons)

2009

2008

Agriculture, Forestry and Fishing

2689

2689

Mining and quarrying

100

107

Manufacturing

1751

1905

Construction

726

749

Wholesale and retail trade; repair of motor vehicles and motorcycles

1157

1166

Transportation and storage

455

454

Real estate activities

16

15

Education

386

399

Human health and social work activities

395

381

(Source: Statistics of Romania: Page 18)

Unemployment rate as a percentage of total labour force stood at 6.87% at end of year 2010, a drop from 2009 (7.8%).

 

Romania Unemployment Rate

(Source: National Bank of Romania: Pg. 20)

Minimum wage

Average monthly wage rate for employees across all sectors was RON 1,381 in 2009. Nominal Wage Indices for employees was highest for finance and insurance sector in 2009, indicating high demand for workers under this industry.

Average Monthly Wage Rate for different industries (RON)

Activity

2009

2008

Finance and Insurance

3182

3205

Transport and Storage

1461

1454

Wholesale and Retail; repair of motor vehicles and motorcycles

1127

1042

Education

1563

1538

Health and social assistance

1333

1266

Real Estate activities

1281

1270

Construction

1127

1162

Information and communication

2445

2119

(Source: Statistics of Romania: Page 27)

Level of unionisation

Major Trade Unions in Romania are:

 

·         National Confederation of Free Trade Unions consists of 44 unions with a total membership of 0.8 million members.

 

·         Cartel Alfa which is an organisation of 40 unions and two associates with a total membership of 350,000 members.

 

·         The Democratic Trade Union Confederation of Romania including 22 unions with a total of 350,000 members across various sectors.

 

·         Meridian is a trade union which comprises of 150,000 members, mainly in industrial and communications sectors.

(Source: fedee.com)

[Top] Political Stability

Total number of individuals in the working age population (15 – 64 years of age) in the period from October to December 2010 was 32.2 million. The country’s total labour force in the same period was 17.27 million. The total labour force decreased as compared to the corresponding period in 2009.

Of the total labour force, 13.13 million were employed in the period between October and December 2010.

The labour force participation rate in the fourth quarter of 2010 was 53.6%, as compared to 55.1% in the fourth quarter of 2009.

(Source: National Statistics)

South Africa Employees

(Source: National Statistics)

Number of employed person according to function:


 

Oct – Dec 2010

Jul – Sep 2010

Oct – Dec 2009

Formal sector (non-agricultural)

9,163,000

9,043,000

9,344,000

Informal sector (non-agricultural)

2,225,000

2,172,000

2,154,000

Agriculture

627,000

640,000

624,000

Private households

1,117,000

1,119,000

1,129,000

(Source: National Statistics)

Unemployment

The unemployment rate in the country at the end of December 2010 was 24%, as compared to 24.2% at the end of December 2009. The total number of unemployed individuals at the end of the fourth quarter of 2010 was 4.14 million, decreasing 2.1% as compared to the corresponding period of 2009

(Source: National Statistics)

 South Africa Unemployment rate 

(Source: National Statistics)

Minimum wage

Wages in South Africa differs according to different municipalities of the country. Below are the consolidated minimum wages given to domestic workers according to their working hours:


Minimum wages for domestic workers who work more than 27 ordinary hours per week

Minimum rates for the period 1 December 2008 to 30 November 2009

Minimum rates for the period 1 December 2009 to                 30 November 2010

Hourly Rate   (R )

5.63 - 6.88

Hourly Rate   (R )

6.11 - 7.40

Weekly Rate   (R )

253.35 - 309.60

Weekly Rate   (R )

275.14 - 333.13

Monthly Rate   (R )

1097.40 - 1340.95

Monthly Rate   (R )

1191.78 - 1442.86

  

 

 


 

 

 

 


Year and Month

Average Monthly earnings (Rand)

Quarterly Changes (%) q/q

Annual Changes (%) y/y

2007

Feb

7,870

-0.7

-

 

May

8,093

2.8

7.5

 

Aug

8,409

3.9

6.6

 

Nov

8,752

4.1

10.4

2008

Feb

8,750

0.0

11.2

 

May

9,142

4.5

13.0

 

Aug

9,520

4.1

13.2

 

Nov

9,527

0.1

8.9

2009

Feb

9,614

0.9

9.9

 

May

9,724

1.1

6.4

 

Aug

10,591

8.9

11.3

 

Nov

11,020

4.1

15.7

2010

Feb

11,207

1.7

16.6

 

May*

11,570

3.2

19.0

 

Aug

11,825

2.2

11.7

 The above table is average monthly earnings of all formal non–agricultural industries at current prices.

(Source: Labour Department, National Statistics)

Level of unionisation

The trade union movement in the country is considered to be the biggest and most well-organised in the African continent. Trade unions have played a major role in forming the labour market and industrial relations policy. Their role in removing apartheid legislations and practices at workplace are considered to be a major achievement.

There are three dominant trade union federations with affiliates operating in the different sectors of the economy. The major trade unions federations are:

  • Congress of South African Trade Unions (Cosatu)
  • The Federation of Unions of South Africa (Fedusa)
  •  The National Council of Trade Unions (Nactu)

There are about 190 trade unions in the country. Most of these 190 trade unions are affiliated to one of the above mentioned trade union federations. Few of the trade unions are listed below.

  • Amalgamated Union of Building Trade Workers of South Africa
  • Transport & Omnibus Workers Union (TOWU)
  • SASBO: The Finance Union
  • Motor Transport Workers’ Union  (South Africa)
  • Trawler and Line Fishermen’s Union (TALFU)
  • Building Workers’ Union
  •  Metal & Electrical Workers Union of South Africa  (MEWUSA)
  •  Aviation Union of  Southern Africa
  • Federated Mining and Allied Industries Union
  •  South African Chemical Workers Union – SACWU
  •  Media Workers Association of South Africa (MWASA)

 (Source: labourguide.com, southafrica.info)

[Top] Demographic Overview

Education

The Ministry of Education and Training is the governing authority of the national education system in the Solomon Islands. The system is patterned after the British education system.

The main stages of education in the country include primary education, secondary education and higher education. Six-year elementary or primary education is the first level of education system. Secondary level of education lasts for a duration of seven years. The education services at this level are provided by national secondary schools, community secondary schools and several privately-run high schools. The third level consists of higher education.

The total enrolment for 2010 was 118,528, as compared to 115,075 in 2009. Total new enrolments for 2010 were 3,452, as compared to 3,352 in 2009.

(Source: unesco.org)

Adult literacy rate for 2010 was 76.6%. In the period 2004-2008, youth literacy rate among men was 90% and women was 80%.

(Source: undp.org, unicef.org)

Health

Ministry of Health and Medical Services is the governing body of the health sector of Solomon Islands.

Health facilities provided by the Solomon Islands include public hospitals, rural health centres and nurse aide posts. Seven of the country’s nine provinces have a public hospital. There is one private hospital in the Western Province, one in Choiseul Province and one in Malaita Province. Rural health centres are well dispersed throughout the provinces, based on demographic specifications of the regions.

In 2009, there were 118 doctors (2.1 per 10,000 population), 934 nurses (17 per 10 000 population) and 146 midwives (2.6 per 10,000 population). In 2008, expenditure of the Ministry of Health and Medical Services was US $32.2 million, as compared to US $12 million in 2004.

Infectious diseases are main causes of mortality in the country. Non-communicable diseases like cancer, diabetes mellitus, hypertension, tobacco-related diseases and mental illness are also on the rise.

(Source: who.int)

[Top] Soft Infrastructure

Literacy rate in Romania is 97.6% in 2010.

(Source: guardian.co.uk)

Educational Resources

Romanian education system includes:

·         Pre – School

·         Primary Education

·         Secondary Education

·         Higher education

Pre-School education focuses on educating the citizens on long term perspective with respect to health, nutrition and social protection for children aged 0-6 years. Primary education includes classes I – IV.

There are two types of secondary education programmes: lower secondary and upper secondary education. Secondary education lasts for 8 to 9 years.

Higher education is organized as University education and Postgraduate studies.

(Source: Ministry of Education, ibe.unesco.org)

In year 2009/10, there were 8244 educational units in Romania.


 

Year 2010 ('000 persons)

Levels

Enrolments

Teaching Staff

Pre-school

666

38

Primary and secondary

1,720

135

High school

838

60

Vocational and apprenticeship

115

3

Post high school and foremen education

63

1

Higher education

775

31

Total

4,177

268

(Source: Statistics of Romania, Pg: 38, 39)

Healthcare Resources

The health care system of Romania has a network of sanitary units (hospitals, polyclinics, dispensaries and other institutions. In 2009, this network comprised 473 hospitals and number of beds in hospitals was 138915.


Year 2009

Medical-sanitary staff

Number

Physicians

50,415

Dentists

12,486

Pharmaceutical chemists

11,988

Ancillary medical staff

129,453

(Source: Statistics of Romania, Pg: 36, 37)

In 2009, the number of medical staff per 1000 inhabitants was: 23.5 physicians, 5.8 dentists, 5.6 pharmaceutical chemists and 60.3 ancillary medical staff.

[Top] Hard Infrastructure

Consumer price index (CPI)

CPI witnessed a steady rise from 2006 to 2009. In 2010, the index is estimated to reach approximately 233.96.

(Source: Econ Stats)

Solomon Islands CPI

Base = 2005

(Source: worldbank.org 

Producer price index

In Q3 2010, producer price index was 159.5 as compared to 119.8 in Q3 2009.

Solomon Islands PPI

 

 

Base, 1994 = 100

 

(Source: Central Bank) 

Interest rate on savings deposits

The bank offers around 0.25% to 2.50% interest rates on saving deposits during 2010, and 0.25% to 2% interest rates in 2009.

(Source: Central Bank)

Interest rate on time deposits

Duration of Time Deposits

Interest Rate on Time Deposits (%) (2010)

3 months to 6 months

0.25 – 11

6 months to 1 year

0.50 – 12

1 year to 2 year

0.50 – 13.50

2 year to 3 year

0.50 – 10

3 year to 5 year

8 – 9

(Source: Central Bank,)

Money supply

The country’s overall money supply witnessed steady rise from 2005 to 2009.

Solomon Islands Money supply
(Source: Central Bank)

Demand deposits

In 2009, total demand deposits reached SBD 709.3 million, as compared to SBD 440.2 million in 2008.

Solomon Islands Demand deposits

(Source: adb.org)

Government expenditure

From 2005 to 2008, total expenditure increased steadily. In 2009, the amount was registered at SBD 1,701.60 million.

Solomon Islands Total expenditure

(Source: adb.org)

Public debt level

The government had experienced a falling debt level from 2006 to 2009. In 2010, gross government debt was registered at SBD 372.45 million.

Solomon Islands Gross government debt

(Source: Central Bank)

Official exchange rate

Solomon Islands Exchange rate

(Source: Central Bank)

Government financial well-being

 Fiscal balance (SBD million)

Year

2009

2008

2007

2006

2005

Revenue

1,488.9

1,370.0

1,093.0

849.9

621.1

Expenditure

1,701.6

1,727.1

1,233.0

1,054.7

806.5

Fiscal Balance

-212.7

-357.1

-140

-204.8

-185.4

 

(Source: adb.org)

Solomon Islands experienced a fiscal deficit from 2005 to 2009. In 2009, the fiscal deficit amounted to SBD 212.7 million.

Total revenue

Solomon Islands Total revenue

(Source: Central Bank)

Total revenue increased steadily from 2005 to 2009. In 2009, the amount was registered at SBD 1,488.90 million.

 Solomon Islands Tax revenue

(Source: adb.org)

Tax revenue for 2009 was SBD 1,307.40 million, increasing 6.88% from 2008 value of SBD 1,223.20 million.

Total grants

Total grants for 2009 amounted to SBD 216 million, as compared to SBD 204.3 million in 2008.

Solomon Islands Total grants

(Source: adb.org)

Current account balance

Solomon Islands Current account balance

(Source: adb.org)

The country registered a rising current account deficit from USD 5.9 million in 2005 to USD 124.7 million in 2009.

Balance of payments

Balance of Payments

2009

2008

Balance on Current Account

-124.7

-118.8

Current Transfers

115.5

109.9

Capital Account

26.9

14.3

Financial Account

148.0

85.3

Net Errors and Omissions

-5.4

2.7

Overall Balance

44.9

-16.6

 

(Source: adb.org)

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