BMI's Executive Summary

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In early September Romania's National Highways Company said it was planning to introduce road tolls on its two highways, Bucharest-Pitesti and Bucharest-Constanta, to start in 2008. The development came amid continuing signs of a big increase in road haulage. Road use surged ahead in the first half of 2007, according to data reported in August by Mediafax news agency. The number of freight vehicles registered on Romania's roads grew by 37.7% to 43,851. The number of passenger cars rose even more sharply, by 41.3% to 192,147 units, according to National Institute of Statistics (INS) figures.

The issue for Romania is not whether it can find the money to develop its motorway infrastructure and thereby help develop the road haulage industry – thanks to EU membership from the beginning of 2007, there is no shortage of funds on offer from Brussels. The credits have been rolling in and some EUR5bn in EU transport investment is expected over the next six-year period. The real issue is whether the government can show that its spending is well planned and business is given to contractors according to a transparent bidding process. Some progress has been made on this front, with a highly controversial and uncompetitive US$2.8bn Bechtel contract has now been renegotiated and double payments on a border surveillance contract with aerospace group EADS removed. In our newly-released Romania Freight Transport Report, BMI concludes that Romania's road freight traffic, measured in million tonne-km (mntkm), is likely to grow at an annual average of 9.1% over the next five years.

An expanded motorway network will play an important role in this strong rate of growth, but other factors will also play a part. GDP growth is expected to surge ahead by an annual average of 5.1% in 2007-2011, underpinning demand for haulage. Closer integration with the wider European economy will be important, with trade growing strongly and physical links to the main European transport corridors opening up. We are predicting average annual growth in freight carried across all modes, measured in mntkm, of 7.7% in 2007-2011, ahead of GDP growth. We estimate that rail freight traffic will continue the moderate recovery it started in 2004, although there was a setback in 2006, due to floods. As competition begins to increase and investments take effect, rail freight traffic should pick up. However, for the 2007-2011 forecast period, the annual rate of growth in rail freight traffic will be 4.1%, slower than overall economic growth. Inland waterway traffic will rise by an annual average of 6.1% as bottlenecks are removed from the Danube. Maritime freight will grow by an annual average of 6.5%. Airfreight will see strong growth of an annual average of 12.0%, boosted by the spread of low-cost airlines across Europe. The total value of transport and communications GDP will rise to US$25.4bn in nominal terms by 2011, representing 11.2% of Romania's GDP. The transport and communications sector employed 457,100 people, or 5.0% of the labour force, last year. We see that figure falling to 452,700 by 2011, although it will remain constant at 5.0% as a share of the total workforce.

Romania has a composite score of 44 out of 70 for its BMI freight transport business environment rating. This places it in the upper range among its European peers. The country scores well for long-termpolitical risk, transport infrastructure growth and transport intensity (an indicator of the dynamism of foreign trade). It does less well, however, in areas such as long-term economic risk and the regulatory and competitive environments.

Competitive Landscape for Europe Freight Transport Reports: Sample of Companies Ranked

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Analysis of latest projects across the freight transport sector – road, rail, air, sea, logistics – including market overview which provides an outline of the key elements driving development. SWOT analysis of the state’s business environment, transport sector, politics and economics, which carefully evaluates the short- and medium-term issues facing the industry.

Network of European Freight Sources

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BMI's European Freight Transport Reports are based on an extensive network of multilateral organisations, government departments, freight transport industry associations, chambers of commerce and company reports. Information sources include: