Romania has suffered from poverty and political confusion but has now joined the EU
Western Romania is dominated by the Carpathian Mountains which take up around one-third of the land area and run from the northern border with Ukraine down the centre of the country before veering west and exiting south-west into Serbia. East of the mountains are broad plains that extend to the south before reaching the coast of the Black Sea.
Most people are ethnically Romanian but there are significant minorities that have given rise to ethnic tensions. The largest minority are the two million Hungarians who are concentrated in the north-west of the country and have been pressing for greater rights. These efforts have born fruit in recent years with greater language rights and the creation of a Hungarian university. The other important minority are the Roma, or gypsies. The official figure is around 500,000 but there are probably nearer two million. They tend to live apart from other Romanians and have been subject to widespread discrimination and abuse. Many have fled to other countries, notably Germany. Around 1.8 million Romanians work abroad, especially in Italy, Spain, Germany, Israel, and Hungary.
Romania is one of the poorest countries in Eastern Europe. More than one-quarter of the people live in poverty—with particularly high poverty rates in the north-east. Health standards are desperately low: the rates for infant and maternal mortality are among the highest in Europe.
As a result of economic uncertainty and family planning, the birth rate is very low. In addition, many people are leaving to work abroad. Around two million migrants have moved to other EU states mainly to Spain and Italy. Combined with a rising death rate this has led to a steady fall in population—by 7% between 1992 and 2007.
Around one-third of the workforce are employed in agriculture. Almost all the agricultural land is now in private hands, but this is mostly in the form of small inefficient plots in which there has been very little investment. EU funds could help change this, though farmers may not have the capacity to use such funds efficiently.
Communist governments had given a high priority to heavy industry. Romania's manufacturing potential now lies in more labour-intensive light industries, though traditional industries such as textiles struggle to compete with developing countries. There has been some foreign investment in the car industry, notably in the Dacia plant which is owned by Renault, as well as in pharmaceuticals, but manufacturing overall has been slow to take off.
Romania's economic reforms have been sluggish—resisted by the bureaucracy, the trade unions, and by politicians milking the system. State enterprises continue to play a major role in utilities, banking, and manufacturing.
Given the country's scenic beauty and rich culture, there is potential for tourism but this remains largely underdeveloped.
Monitored by Brussels
Romania joined the European Union in 2007 but is still being monitored by the European Commission to ensure that it fulfils the commitments made during accession. There are still considerable doubts about the judicial system and concerns about corruption.