Flag description: three equal vertical bands of blue (hoist side), yellow, and red; the national coat of arms that used to be centered in the yellow band has been removed; now similar to the flags of Andorra and Chad
Economy
Economy - overview: Romania, one of the poorer countries in Central and Eastern Europe, began the transition from Communism with a largely obsolete industrial base and a pattern of output unsuited to the country's needs. Over the past seven years, economic restructuring has lagged behind most other countries in the region. Consequently, economic performance is declining, with slowing GDP growth, ballooning budget deficits, accelerating inflation, a plunging exchange rate, and anemic foreign investment. Unemployment was low at about 6% at the end of 1996, but the rate will rise when restructuring gets underway. A new government elected in November 1996 promises to accelerate economic reform, restructuring, and privatization, introduce fiscal and monetary austerity, reduce the state's role in the economy, and open Romania to foreign investment. The government will tackle its formidable economic problems in two stages, with an emergency plan over the winter of 1996/97 to ensure social and political stability, followed by a radical structural reform program over its remaining three-and-one-half years aimed eventually at EU accession. At the same time, it wants to keep campaign promises to increase benefits to disadvantaged groups. Bucharest hopes to receive financial and technical assistance from international financial institutions and western governments and negotiations over a new IMF standby agreement are underway. If reform stalls, however, Romania's bond rating - just below investment grade - could fall and needed capital from both public and private sources could quickly dry up. Rich agricultural and oil resources are strengths for the future.
GDP: purchasing power parity - $113.2 billion (1996 est.)
GDP - real growth rate: 4.1% (1996 est.)
GDP - per capita: purchasing power parity - $5,200 (1996 est.)
GDP - composition by sector: agriculture: 20% industry: 33.4% services: 46.6% (1995)
Inflation rate - consumer price index: 56.9% (1996 est.)
Labor force: total : 10.1 million (1996 est.) by occupation: industry 28.8%, agriculture 36.4%, other 34.8% (1994)
Unemployment rate: 6.1% (1996 est.)