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BNR: the capacity of producers to cover the consumption demand, eroded by imports and the cost with the work force
The capacity of the local producers to cover the consumption demand was eroded, in Q1 by the pressure of the costs with the work force and the competition of imports at very low prices, shows a publication of the Central Bank (BNR).
‘The growth recorded by the domestic demand in Q1 (7.8 percent, the annual variant) – record for the post-crisis period –was due mainly to the consumption of the population, on the basis of the salary increases, operated along the previous year and the descending trend of the consumption prices attributed especially to the two episodes of reduction of the VAT ( June 2015 and January 2016). Moreover, the appetite for consumption of the population was stimulated by a series of measures adopted by the big commercial operators with a view to consolidating the market share – the extension of the distribution network, of the big commerce chains and the intensification of the promotional policies, especially on the segment of food’ the quoted document says.
According to it, the main segment where the worsening of the commercial balance was produced in Q1 is that of consumption goods (including vehicles)’ as the slight coming back of the foreign deliveries – supported by exports of textiles and furniture – was completely annihilated by the expansion of the imports’.
‘In this last case, a significant factor is constituted by the high demand for second-hand cars destined to the population. Moreover,the deficit of food commerce was deteriorated, the capacity of the local producers to cover the demand for consumption being eroded, on the one hand by the pressure of costs with workforce and on the other hand by the competition of the imports at very low prices. A worsening of the commercial balance was recorded and the group of intermediary goods, a significant contribution belonging to the commerce with chemical products, as the industry of fertilisers is continuously affected by the closing down of an important company in the first part of 2015. In exchange, the cars exports, equipments and transport means increased their annual dynamics, the majority of the products having improvements of the shares owned on an extended European market’ BNR said.