Romania’s manufacturing sector at new post-crisis high in January

Romania’s manufacturing sector at new post-crisis high in January
By bne IntelliNews March 15, 2021

Romania's industrial production index decreased by 2.3% in January compared to the same month of 2020, the statistics office INS announced. 

But the detailed data are more encouraging. The country's industry performed better than the overall figure might imply: the core manufacturing industries advanced on average by 1.6% m/m in seasonally adjusted terms from December and reached a new post-crisis high.

The primary industry (mining and quarrying) was indeed hurt more deeply by the asymmetric crisis, and its recovery is still uncertain until the secondary industry recovers fully and sustainably. Therefore, the mining and quarrying industry's output lagged by 13.7% y/y in January.

Meanwhile, the core manufacturing industries posted a milder 2% y/y contraction. Compared to the 2.6% y/y growth in December, January’s annual contraction might indicate a deterioration, but it may also be interpreted as reflecting the unstable and volatile nature of post-crisis recovery under a variable situation in the health sector and still relevant issues related to the supply chain.

A good example is the automobile industry, which has been hit by the microchip shortage: the production of transport means contracted by 10% y/y in January and has faced through entire first quarter a problem related to the microchip crisis.

While light industries are still operating at low capacity, other industries (chemicals, electronics, furniture, metallurgy) have fully recovered and boast positive annual growth rates.

Data

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