Analysts have warned that US tariffs may push Romania into recession, particularly if the EU takes similar steps. 

Although it is too early to estimate the impact of the US tariffs on Romania’s economy, it can be said that it is going to be stronger than suggested by the small share of direct bilateral trade (2.3% of Romania’s total trade and 0.1% of US’ total trade); it is going to be indirect – via the economic impact in Europe, in particular in Germany; and has the potential of generating recession in Europe and Romania, particularly if the European Union resorts to retorsion, thus increasing uncertainty and compressing the investments.

A slowdown in Romania’s exports of electric and electronic equipment, iron and steel and tyres to the United States will immediately impact these sectors. The tariffs on exports of European automobiles to the US will hit the car parts manufacturing ecosystem. Regarding imports, Romania is not immediately impacted, but will not escape a broader rise of prices in Europe if the EU relies on retorsion.

Prime Minister Marcel Ciolacu announced support measures for the most hit industries, but the fiscal resources are scarce.

The support measures are intended for all industries impacted by "the effects of the new trade war of customs tariffs between America and Europe", Ciolacu said, noting that investors’ confidence has increased recently. 

"We are preparing support measures for all affected industries through state aid schemes that are as efficient and simple to apply as possible so that they can produce effects in the shortest possible time," Ciolacu said at the beginning of a government meeting on April 3.

Finance Minister Tánczos Barna said that discussions would take place with two business associations next week to assess the impact of the US tariffs and identify potential mitigation measures.

He added that he is waiting for proposals from the business community regarding support measures that could mitigate the impact of the tariffs. He also pointed out that according to the ministry's data, the auto industry is doing well for now.

Adrian Codirlasu, head of CFA Association Romania, argued that the tariffs announced by Trump on April 2 are high and have the potential to lead both the US and EU economies into recession, including Romania's economy, which already faces a delicate fiscal situation.

"Romania will be affected especially indirectly, through its main trading partners (Germany, France, Italy) … Recession is possible this very year. In addition to external factors, we also have internal factors: fiscal uncertainty, downgrade risk, and political risk. Things that put investment plans on ice," Codirlasu said in a statement.

A Romanian Economic Monitor (RoEM) - UBB FSEGA ad-hoc report predicts that even without a response from the European Union, Romania’s economy risks falling into recession for a short period, and even the US economy may see negative growth. An inflationary shock is also predicted. Analysts said a response from the EU would increase the magnitude of the developments. 

“If the EU responds with a similar increase in customs tariffs with the US, RoEM analysts believe that the negative effects described above multiply in terms of inflation and economic slowdown, and the uncertainties and unpredictability of a long trade conflict will jeopardise business planning and investments made by the business environment,” according to the ad-hoc report.

Romania boasts a trade surplus with the US, with its exports three times higher than its imports.

Romania’s trade with the US posted a FOB-CIF surplus of some €900mn in 2024, with the €2.28bn of exports exceeding by far the €1.31bn imports. The US Census Bureau indicates a wider deficit of $2.6bn with Romania, with $3.9bn of imports and $1.3bn of exports. The discrepancy may be due to the Romanian statistics office’s breakdown by country, the first destination being preferred to the final destination in the case of re-routed goods. This makes the US Census data more relevant.

The bulk of Romania’s exports to the US consist of electric and electronic equipment, iron and steel goods, rubber products (tyres) and, to a smaller extent, car parts. When it comes to imports, Romania imports high-tech items such as navigation equipment, radio systems and aircraft. Large amounts of military equipment and aircraft are going to be imported under contracts already signed.