NBR has finally drawn the line; the explosive trade deficit growth has made Romania's current account deficit for 2003 worse, pushing it to 2.9bn euros, nearly 80% above the level registered at the end of 2002. Foreign direct investment covered only 46% of this amount, with the funding sustained by one billion euros in form of foreign loans.

Depending on the estimates considered for computing the gross domestic product (about 58-58.5bn euros), the weight of the current account deficit might be somewhere in the neighbourhood of 6%.

The foreign balance was largely upset by the increase in the trade deficit by no less than 1.2bn euros in FOB/FOB prices, following an import growth of 2.3bn euros (12%) to 22.2bn euros. At the same time, exports only managed to achieve a 1.1bn-euro surplus, based on a 6.4% growth, that is half the progress made by imports. The trade balance deficit was joined by the revenue deficit, a minus 630 million euros, some 30% more than in 2002.

Romania attracted foreign direct investment worth 1.35bn euros last year, which covered only 46% of the current account deficit financing needs. Romania's weak capability in attracting foreign investments continued to single it out among other countries in the region that manage to fully fund current account deficits as high as 7% of GDP from foreign direct inflows.

Which raises doubts as to Romania's capability to sustain a 2004 deficit the size of last year's.

The low foreign investment contribution level was compensated for by long-term foreign loans worth one billion euros.

At the same time, portfolio investments contributed only half a billion euros, close to the 2002 level.

The money sent back home by the Romanians working abroad helped to somehow rectify the current account balance due to the 1.4bn-euro po