Romanian September retail sales soar as shoppers earn, borrow more

The rise in sales, excluding cars, motorcycles and engine fuels, was led by a 23% gain in sales of non-food goods, the National Statistics Institute said today in an e-mailed statement. Food, alcohol and tobacco sales rose almost 21%. Retail sales in the first nine months of the year rose almost 25% from the period last year as consumers bought 28% more food and 22% more non-food goods. Adjusted for the difference in number of working days, sales rose 22.3% in the year through September. Lower taxes, cheaper loans and higher income have boosted consumption in Romania, which will join the European Union on Januar 1. Government economists have forecast the economy may expand an annual 7% this year. Average net salaries rose an annual 10.7% in real terms in September, according to government data. Romanians took out 55% more consumer loans in the first nine months of this year than in the period last year and a 16% flat tax replaced individual taxes as high as 40% last year. The potential for increasing profits and the impending EU entry is attracting more international retail chains to Romania. So far this year, European retailers Auchan SA, Carrefour SA, IKEA, Metro AG, Praktiker AG and others have announced plans to enter Romania or boost investments in the country. (Bloomberg)