Romania needs to improve productivity, infrastructure, energy costs, skills and tax collection to maintain the competitiveness of its automotive industry, according to Daniel Anghel, Country Managing Partner at PwC Romania.<\/p>\n\n\n\n
Competitiveness was no longer determined solely by labour costs, as factors such as energy, productivity, infrastructure, skills, taxation and innovation capacity had become equally important, Anghel told the Automotive Forum 2026, organised by Automotive Today and The Diplomat-Bucharest.<\/p>\n\n\n\n
\u201cFor Romania, the stakes are very high. The automotive industry is one of the anchors of the economy and an important driver of exports, investment and employment,\u201d he said.<\/p>\n\n\n\n
Anghel said the competitiveness of the automotive sector was closely linked to that of the wider Romanian economy, which has experienced a sharp slowdown in economic growth.<\/p>\n\n\n\n
Romania’s real economic growth declined from 4.9% in 2022 to 2.5% in 2023, 1.1% in 2024 and 0.8% in 2025, according to figures cited in his presentation. The forecast for 2026 stood at minus 0.4%, followed by a moderate recovery to around 1.7% in 2027.<\/p>\n\n\n\n
Inflation, although down from around 10% in the first part of the year to 6.6% in September, was expected to rise again towards the end of 2026, exceeding the previous forecast of 6.1%, he said.<\/p>\n\n\n\n
The central bank’s policy interest rate stood at around 6.5%, keeping financing costs high and putting additional pressure on vehicle demand and companies’ ability to fund investments in the energy transition.<\/p>\n\n\n\n
The combination of weak economic growth, persistent inflation and expensive financing was making it more difficult for companies to invest in innovation and the transition to cleaner energy, Anghel said.<\/p>\n\n\n\n
Fiscal policy was another factor weighing on competitiveness, he added, pointing to tax increases introduced in 2025, which had generated additional revenues, particularly from VAT, up around 22.2% compared with the previous period.<\/p>\n\n\n\n
Romania’s budget deficit fell to 3.8% of gross domestic product in the first nine months of 2026, from 5.4% in the same period a year earlier, while the full-year deficit was expected to reach around 6.2% of GDP, according to the figures presented by Anghel.<\/p>\n\n\n\n
The country has committed to bringing its budget deficit below 3% of GDP by 2031, suggesting further fiscal consolidation measures may be needed in the coming years.<\/p>\n\n\n\n
However, Anghel said there was little room for additional tax increases and that improving tax collection remained the main opportunity for increasing budget revenues.<\/p>\n\n\n\n
\u201cRomania needs fiscal consolidation, but this must be achieved through efficiency, collection and spending prioritisation, not through further tax increases that would affect investment and competitiveness,\u201d he said.<\/p>\n\n\n\n
He also highlighted Romania’s VAT compliance gap, estimated at around 30%, as an area where improvements in tax administration and collection could generate significant additional revenue without increasing the tax burden on businesses.<\/p>\n\n\n\n