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Romania Retail Report Q2 2009Published by: Business Monitor International Published: May. 21, 2009 - 44 Pages Table of Contents
AbstractThe new BMI Romania Retail report predicts that the country’s total retail sales will rise almost 60% by 2013, growing from US$30.0bn in 2006 to an estimated US$63.4bn by 2013. Continuing wage growth, the recent consumer-lending boom and rising disposable income following the introduction of a new flat rate of income tax are key factors behind retail market expansion. The privatisation process since 1990 and EU membership gained in 2007 have allowed retailers to make significant inroads into the market, contributing to forecast annual retail sales growth of 11.6% in dollar terms.Romania’s nominal Gross Domestic Product (GDP) was US$166.5bn in 2007. Average annual GDP growth of 4.2% is predicted by BMI until 2013. Although the population is forecast to decrease slightly, from 21.4mn in 2007 to an estimated 21.3mn by 2013, GDP per capita is predicted to double by the end of the forecast period, reaching US$15,563. Our assumption of consumer spending per capita is for an increase from US$4,392 in 2007 to US$6,091 by 2013. Wage growth in Romania, as in many other Emerging European countries, is accelerating fast, having more than doubled between 2000 and 2006 from US$3,791 to US$8,286. The European Commission expects both nominal and real 2008 wage growth in Romania to be the fastest among all the 27 member states. Expansionary fiscal policies - including government wage increases and increased social spending - will further boost consumer expenditure. The country has the second-biggest population in Central Europe after Poland, with some 39.2% of the total in the 20-44 years age range in 2005, according to UN data. This segment of the population, which is a key element of future retail spending, is forecast to increase to 41.3% by 2010. The proportion of the population classified by the UN as ‘active’ was 70.1% in 2005, and should reach 70.7% by 2010. Non-food retail sub-sectors benefiting from changing patterns of consumption in Romania include clothing and footwear, which constituted 6.2% of total household monthly expenditure in 2006 - up from 5.9% in 2001, according to the National Institute of Statistics (INSSE) - and furniture, which accounted for 4%, up from 2.9% in 2001. Meanwhile, BMI data suggest that over-the-counter (OTC) pharmaceutical sales, which were worth US$0.63bn (1.6% of total retail sales, in 2007), will grow to US$1.22bn (1.9% of total sales) by the end of the forecast period. Retail sales for BMI’s universe of Central and Eastern European (CEE) states in 2007 were an estimated US$1.02bn, based on the varying national definitions. Total consumer spending for the region, based on BMI’s macroeconomic database, was US$1.48bn. Russia, Turkey and Poland together in 2007 accounted for an estimated 82% of regional retail sales, with their combined share expected to reach almost 83% by 2013. For Romania, the estimated 2007 market share of 3.9% is expected to fall to 3.6% by 2013. Get Full Details About This Report >> |
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