The relentless drum-beat of good economic news continues. In the first quarter of 2004, Romania's economy grew at an annualized rate of -- wait for it -- 6.1%. The growth was led by the industrial sector (which grew at 6.6%) and construction (7.2%). The service sector grew by 5.7% and agriculture by 5.4%... slow compared to the rest of the economy, but still not bad. Inflation is continuing to fall smoothly, down from 14% in December to about 12% now, and on schedule to hit 9% by the beginning of next year. Meanwhile, real wages suddenly surged in the first quarter. After growing only sluggishly (like 1%-2% per year) for the last three years, they suddenly rose at an adjusted rate of nearly 10% after inflation. The foreign trade deficit is still big and still growing -- but the rate of growth dropped sharply; if it continues to drop, then the deficit will stabilize this summer and then start to shrink before the end of the year. (The main cause of this seems to have been a sharp rise in commodity prices, especially things like aluminum, cement and steel -- all major Romanian exports.) Foreign direct investment -- both greenfields and equity purchases -- is up by about a third since last year. It's still pathetically low compared to FDI in, say, Hungary, but it's expected to double in the next two to three years. The leu is stable. Tax revenues are up. The government is projected to run another fiscal deficit this year, as usual... but the surge in revenues means that the deficit will fall to 2.1% of GDP, down from the originally predicted 3.0%. In theory, this means that Romania might see a balanced budget by 2007. I have some thoughts on all this, but I'm going to save them for a later post. Just now I want to put the question to our readers: Is this for real? And, if it is, how long can it go on?