ZF English

Romania heading for soaring food trade deficit

13.01.2004, 00:00 7



Romania is heading for a huge deficit of the food trade in 2003, namely more than one billion euros, accounting for 20% of the total trade deficit. We import much more than we export pork, wheat, milk, sour cream, fresh fish, onions, apples and pastry products.



The detailed data on the food trade are destroying a myth: Romania is no longer a country with flourishing agriculture. The economy has even posted a trade deficit in the ... whey department: ten-month imports worth 1.2 million euros, whereas exports only amounted to 0.9 million euros. The whey deficit value is not significant, but symbolises the Romanian agriculture's inability to meet domestic demand and to send processed products to the international markets.



According to data released by the Ministry of Agriculture, Food and Forests, the Romanian economy has logged a record-high deficit of 865 million euros in the food trade section in the first ten months of last year, up 60% from the deficit posted in the same period of 2002 - 539 million euros.



The deficit was caused both by the significant growth of imports (mainly grain imports) and by the lack of competitive Romanian products on the foreign markets. The situation is very serious, especially since the Romanian producers are already protected by customs duties.



"The huge deficit occurred as not enough attention has been paid to the Romanian agriculture since the Revolution. This will not go away because, as we are getting closer to EU accession, import customs duties will gradually decrease, which will boost imports. I believe that imports will only see a decrease in 2008, after the agriculture support programmes show some results," says Mihai Lungu, chairman of the Romalimenta patronage.



Wheat accounted for the bulk of imports last year - 169 million euros, followed by cigarettes and tobacco, with 135 million euros.



Sugar comes third in the top of imports, with almost 100 million euros. "The soaring imports of sugar came as prices dropped on the international markets, but were also caused by the shrinking sugarcane fields in Romania, from the scheduled 80,000 hectares, down to only 38,000 ha," says Ioan Armenean, chairman of the Sugar Patronage. According to Armenean, Romania must keep up the fight by 2007 to be able to impose a quota of 300,000 tonnes of sugar from the domestic production, with the rest to be supplied by the European Union producers.



However, the import boom for the "traditional" products is more difficult to explain. Statistics reveal a baffling fact: even bread, bacon and onions are now being imported. Some 64,000 tonnes of onions were imported last year, up from only 7,000 tonnes in 2002; 57,000 tonnes of potatoes were imported in 2003, up from 12,500 tonnes, with a similar situation reported for carrots, apples or bacon.



"These imports have surged because Romania still does not have an industry to deposit and preserve vegetables and fruits. The summer products are immediately consumed, and then, for the next nine months, we come to depend entirely on imports," Lungu claims.



But what are the products that Romania is still exporting? Just like in other sectors, mainly raw materials. In this case sheep, horses and mules. Romania exported in the first ten months of last year live animals worth 111 million euros, about 30% of the total exports. stelian.negrea@zf.ro