For many centuries Romania`s economy was based on agriculture. In the 1930s Romania was one of the main European producers of wheat, corn and meats and it used to be called "the bread basket of Europe." In the 1950s the communist leader of Romania, Gheorghe Gheorghiu Dej, began developing heavy industry. There has been a shift towards heavy industries since the 1970s but the agriculture is still economically important and employs about one-third of the workforce.
After the overthrow of the Communist regime in late December 1989, the Romanian economy started a long journey from a planned economy to a market economy. Since 1990, successive governments have concentrated on turning Romania into a market economy. This journey kicked off with a decade of economic instability as a result of lack of structural reforms from the stubborn neocommunists at the helm of the country. It climaxed in the late 90s with a near bankruptcy, Romania being close of defaulting on its loans almost at the same time that its southern neighbor, Bulgaria, did. Right afterwards Mugur Isarescu, the national bank governor, was appointed as prime minister and things slowly started to change, the year 2000 being the first of decent economic growth in quite a long time.
Since then, Romania`s economy changed at a fast pace given the prospect of EU entry and economic growth followed at an average of about 6% for the 2000-2005 period, with a peak 8.4% in 2004. Unemployment (6.2% in May 2006) and inflation (expected to be around 7.5% for 2006) also fell slowly but surely during the whole period. According to the IMF, the GDP per capita in PPP (purchasing power parity) terms for 2005 is $ 8785, putting Romania in the lower middle income countries according to the World Bank.
Romania produces coal, natural gas, iron ore and petroleum but most raw material for the country`s large industrial capacity potential are imported. Prominent industries include chemical (petrochemical, paints and varnishes), metal processing, machine manufacturing, industrial and transport equipment, textiles, manufactured consumer goods, lumbering and furniture.
As 39.2% of Romanias territory is arable land, 28% forests, 21% pastures, hayfields and orchards and 2.5% vineyards, the main crops of the country are corn, wheat, vegetable oil seeds, vegetables, apples and grapes for wine. The main livestock are sheep and pigs in the country. Forestry and fisheries are being developed under long-term programs.