Romania’s industrial output (chart) registered a modest 1.3% year-on-year (y/y) increase in October, coupled with a 0.4% month-on-month (m/m) rise in seasonally adjusted terms, according to data from the National Institute of Statistics (INS).

Over the three months from August to October, seasonally adjusted output grew by 2.2%, though this followed a sharp 4.2% m/m decline in July, reflecting ongoing volatility in the sector.

The October figures highlight a partial recovery but remain indicative of a broader stagnation in industrial activity. While the recent rebound suggests some stabilisation, the output levels are significantly lower than the peaks recorded in March and April. Romania’s industrial growth continues to hinge on external demand, particularly from the eurozone, where Germany and France saw industrial slowdowns in October. This casts doubt on sustained growth, especially given the eurozone’s meagre 0.1% projected industrial growth.

On a more optimistic note, the structure of Romania’s industry shows signs of improvement.

While industrial output contracted by 2.2% y/y in volume terms during the first three quarters of 2024, the decline in value-added terms was limited to just 0.4%. This highlights a shift toward higher-value-added production, though it still falls short of the 0.6% y/y growth forecast by the government’s Commission for Economic Forecasting (CNP).

Romania’s industrial sector faces a challenging road ahead, with growth largely tied to eurozone performance. However, improvements in value-added metrics offer a silver lining, suggesting a gradual reorientation of the industry toward higher productivity and profitability. Further industrial recovery will likely depend on stabilisation in external markets and domestic policy support to bolster competitiveness.