InvestRomania is the governmental body responsible for promoting and facilitating foreign direct investment in Romania.
Can you introduce our readers to InvestRomania and your main activities as a promoter of trade and investment?
I joined InvestRomania after a successful career in the private sector and found the opportunity to approach Romania’s business climate through the lens of the policy maker and promoter of trade and investment both a challenge and a real privilege and success. Our efforts over the past few years paid off and culminated with the rise in Romania’s notoriety as an attractive and profitable business destination in the global ecosystem and the management of a 2,25 billion Euro investment portfolio with 69 active projects which will generate 21,300 jobs. I currently oversee the encouragement of local business development, as well as the promotion of foreign trade an investment. My background helps me empathize with businesses’ mentality and priorities and the policies we put forward consequently bear an “inside perspective” trademark.
InvestRomania is the institutional partner and one-stop-shop government body responsible for bringing together all relevant public and private actors currently present or planning to invest in the country. Our service offering includes technical assistance from scratch, as well as post implementation assistance up to the successful completion and running of each great project. Our current priorities include an increase in Greenfield projects, a contribution to the import of capital, know how and technology, as well as a better congruence between the different regions in the country. Furthermore, we find the current bureaucracy excessive, and a streamlined, transparent legislature and private-public overall communication the solution to the advantage of both parties and are working in achieving this.
What was the rationale behind the six industries InvestRomania is focusing on and what are the country’s competitive advantages?
The motto behind our current proactive campaign is “ Romania is a country of quality”, a reality that we know and the world is gradually finding out. IT, automobiles, outsourcing and finance, biotechnology and aerospace are among the industries with long standing tradition in our country, as well as highly trained people. In recent years the economy started shifting from a labor intensive, lower cost one to higher value added investments. For example, Bosch opened an R&D center for the automotive industry in Cluj, where Porsche also set up a center for autonomous vehicles. We are noticing growth in the energy industry arena as well, for example Clariant invested in Craiova together with GETEC.
Romania offers significant advantages to an investor’s bottom line, offering a highly skilled, multilingual and competitively priced workforce, with the third lowest salaries in Europe. The country also boasts a top three position in attractive tax regimes in Europe, the 4th place in the EU for cheap gas and 6th for electricity. Additionally, we have a well developed network of 85 industrial parks, public as well as private, coupled with great fiscal incentives for research and development.
How supportive is the state through the legislative and fiscal measures instituted, to encourage further investment?
Romania has lowered the bar for state aid meant to help support industry investments to 1 million euros. This is meant to allow a broader number of companies, including local ones, access to regional markets and results are expected to start showing. Eligible costs include new building construction, any rental affiliated costs, technical installations, new machinery and equipment, as well as purchasing intellectual rights.
What are the main challenges foreign companies face when doing business in Romania and what progress is being made to overcome them?
There is a global issue surrounding human resources and Romania as well is making efforts to increase the training and retaining of its workforce. The Authority for Dual system Professional Training was set in motion in this respect, and the increased partnerships with universities. Technical schools also offer a significant work pool for the automotive and other industries.
Secondly, infrastructure is an acknowledged challenge that the government is treating very seriously with observable improvements. I have no doubt Romania will overcome this hurdle in the near future. Often when a new investment comes, infrastructure follows industrialization, it is not am impediment at the end of the day. For instance in Sebes when Daimler came the area grew significantly.
A final issue that is being worked on is bureaucracy and the occasional difficulty in dealing with local authorities. This has considerably improved over the past year and we are working together to encourage regional development. We need to look towards the future and also adapt our current legislation to present day needs.
Casting a global viewpoint, what are various investors’ perspectives on Romania’s business environment?
No matter where they come from, investors seek one thing: good profit margins and a favorable, stable economy that allows for medium to long term planning. Romania has proved itself a stable and worthy partner and investors are taking note. Non-EU companies are also attracted by the access they gain to EU’s 500 million consumers and the associated advantages. Many Korean and Japanese companies, including Doosan, Samsung or, respectively, Yazaki or Makita, consider Romania a strong and dependable regional partner. Chinese companies seek ready to run businesses and the government identified suitable projects in transportation, agriculture, tourism and several others. Finally, the United States remains a priority and we are working closely to foster collaboration between our two nations.
What is your vision for InvestRomania and advice to potential future investors?
We are continuously working at fostering foreign trade and investment and maintaining the positive growth trends witnessed in the past few years. We wish to maintain our position as one of the leading recipients of FDI in the region. Since spring 2018 we have had requests of between 50 million and hundreds of million Euros, much more than in previous years and noticed a desire to collaborate with local entrepreneurs. Investors are looking at Romania as an integrated production market. Our goal is ultimately to be in the right place at the right time to make businesses aware of the opportunities at hand.
To investors we say there is no time like the present to establish a presence! Romania remains one of the highest performing economies in the EU, as well as a regional pillar for stability and growth.
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