Current account deficit up to 1.6bn euros

Romania’s current account deficit at the middle of this year exceeded 1.6 billion euros, more than 25% higher as compared to the similar period of 2003. Meanwhile, direct foreign investment reflected in the payments balance climbed to 1.1 billion euros, 47% higher against last year. Foreign investment inflows have thus come to cover more than 71% of the sum necessary for the financing of the current account deficit. The increase can be largely accounted for by the 222 million dollars paid by EBRD and IFC for a quarter of BCR stock. According to Trade Registry data, the share capital subscribed by foreign-held companies exceeded 658 million euros at the end of the first quarter of 2004, 59% higher as compared to the first quarter of 2003. At the same time, statistical data points to accelerated outflows of foreign currency in terms of current account revenues during June. The most unfavourable developments were seen with regard to portfolio investments, which were down 70 million euros. Similar negative trends can be seen in terms of capital investments (interests), which led to a monthly deficit of 63 million euros. ZF