Romania Retail Report Q4 2012Published by: Business Monitor International Published: Sep. 19, 2012 - 72 Pages Table of Contents
AbstractThe Romanian Retail Report examines the long-term potential of the local consumer market, but flags upshort-term concerns about the impact on Romania’s economic outlook of the domestic banking sector'sexposure to deleveraging Western European parent banks.The report examines how best to maximise returns in the Romanian retail market while minimisinginvestment risk. It also explores the impact of renewed uncertainty over the future of the eurozone on theRomanian consumer and on the ability of producers and exporters to realise returns in the short term.We analyse the growth and risk management strategies being employed by the leading players in theRomanian retail sector as they seek to maximise the growth opportunities offered by the local market. Romanian per capita consumer spending is forecast to increase by 35% to 2016, compared with a regionalgrowth average of 44%. The country comes ninth out of 10 in BMI’s Central and Eastern Europe (CEE)Retail Risk/Reward Ratings (RRRs), although it outperforms slightly on the rewards side. Among all retail categories, mass grocery retail (MGR) will be the outperformer through to 2016 ingrowth terms, with sales forecast to grow by nearly 45%, compared with 22.3% for overall food sales.MGR is predicted to expand its share of the total food market to 58.6% by 2016, when value sales shouldreach US$12.77bn. In the competitive arena, BMI sees upside potential in the fact that large-scale infrastructure improvementis ongoing and that Romania will receive substantial influxes of EU funds and loans over the comingyears. The EUR7.1bn (US$9.2bn) investment into rural development during 2007-2013 forms part of thenational budget. Over the last quarter, BMI has revised the following forecasts/views: BMI has revised down its forecasts for Romanian real GDP growth in 2012 and 2013. We nowexpect growth of 1.0% and 2.1% in 2012 and 2013 respectively, from a previous forecast of1.4% and 2.3% growth. Renewed uncertainty over the future of the eurozone will weigh onRomania's trade and investment flows, while the domestic banking sector's exposure todeleveraging Western European parent banks is set to limit credit availability and weigh onheadline growth. BMI has moderately revised down its forecast for 2012 private consumption growth to 2.6%,from 2.8% previously. This remains higher than the 1.3% growth registered in 2011, and wereiterate our expectation for less austere fiscal policy to feed through to higher privateconsumption. We have similarly revised down our 2013 private consumption growth to 3.8%,from 4.0% previously. BMI has revised down its short-term annual growth forecasts for foreign tourist arrivals to slightnegative growth in 2012 of -1.2% (from -0.5% previously), with positive growth of 2.3% in2013. The long-term outlook for arrivals is favourable, bolstered by the stimulus provided by theEU, the establishment of tourism promotion offices overseas and an enhanced marketingprogramme to boost interest in the country. Get full details about this report >> |
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