MINISTRY OF ECONOMY
AND COMMERCE
ROMANIA
Member of the European Union
ECONOMIC DEVELOPMENTS AND
OPPORTUNITIES IN ROMANIA
by
Varujan VOSGANIAN , Minister
1
Benefits of EU Accession
• Removal of any obstacles in the trade with EU Member
•
•
•
•
•
•
States
Common trade policy with third countries
Harmonization of entire legislation, capital market
regulations, taxation, accounting rules => higher
transparency and simplification
Structural funds (31 billion euro for 2007-2013)
Open gate for EU towards CIS, Asia, Middle East,
Northern Africa
Participation in major projects in the Black Sea Extended
Area and in the Central & Eastern European Region
Romania-important role in assuring the energy security for
Europe (major transit pipelines, energy production &
supply)
2
Competitive Taxation
FLAT TAX
16%
VAT
DIVIDENT
TAX
SOCIAL
SECURITY
AVERAGE
WAGE (netto)
MINIMUM
WAGE
19%
10%
43.5%
39.5% by the
end of 2008
272 euro
115 euro
Country
Romania
Hungary
Corporate
Tax
16%
16%
Slovakia
Poland
Croatia
19%
19%
20.32%
Slovenia
Czech
Rep.
25%
28%
Macroeconomic Performance
GDP real growth
8,3
7,1
7
5,7
3,9
3,9
4,9
4,9
2002
2003
4,1
2,1
1,5
1993
8
1994
1995
1996
1997
1998
1999
2000
2001
2004
2005
2006
2007
-3,2
-6,1
-5,4
4
Macroeconomic Performance
Inflation rate
40,7%
30,3%
17,8%
14,1%
9,3%
8,6%
4,8%
2000
2001
2002
2003
2004
2005
2006
3,0%
2008
5
Macroeconomic Performance
Unemployment rate
11,8
12
9,5
10
8,9
10,4
10,5
8,8 8,1
7 6,2
6,6
8
% 6
4
5,5 5,2
5
2
0
1995
1997
1999
2001
2003
2005
2007
6
COUNTRY RATINGS
ROMANIA
•
•
•
•
•
Fitch
Coface
JCR
Moody’ s
Standard & Poors
-
AA4
BBB+
Baa3
BBB-
(August 2006)
(January 2006)
(November 2006)
(September 2006)
(September 2006)
World Bank Report 2006: Romania – the most
reforming country in the business field
7
Foreign direct investments
- million Euro 10000
9100
8000
6000
4098
4000
2000 1294
1212
5197
1627
0
2001
2002
2003
2004
2005
2006
8
FOREIGN DIRECT INVESTMENT
Total FDI’s until 31.12.2006: 31 billion euro
1. The Netherlands - 21,06%
2. Austria - 12,94%
3. France - 10,27%
4. Germany - 10,24%
5 . Italy - 5,56%
6. U.S.A. - 4,72%
7. United Kingdom - 4,43%
8. Netherlands Antilles – 3,65%
9. Greece – 3,61%
Source: National Trade Register Office
Number
of
companies
Share-capital in
Romanian
companies
- mil. EURO -
Netherlands
2655
3112
2
Austria
4192
1979
3
France
4644
1583
4
Germany
14116
1516
5
Italy
21252
845
6
USA
4871
705
7
UK
2657
681
8
Dutch Antilles
12
567
9
Greece
3569
543
N
o
.
Country of origin
1
DIRECT INVESTMENT WITH SIGNIFICANT IMPACT
ON ROMANIAN ECONOMY,
BY MAIN FIELDS, IN 2006
Metalurgy
3.5%
Others
14.2%
Telecomunications,
22.0%
Electonics and
electrotehnics
3.5%
Constructions,
5.6%
Services
12.3%
Energy sector
7.7%
Wood procesing
10.2%
Machine building
9.9%
Source: Romanian Agency for Foreign Investment
Trade
11.1%
10
Foreign Investor Advantages
• foreign investment allowed in all sectors of economy
• possibility to freely manage the company with full
ownership rights
• full repatriation of capital and profits
• protection against expropriation and nationalization
• national treatment for foreign investors
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New Investment Law
Draft under public debate
Objectives:
 Determines the principles, terms and modalities of stimulating investments
in Romania, aiming at contributing to the sustainable country development
 Full compliance with the EU legislation
 The Government will issue also legal/administrative acts in order to regulate
the state aids schemes for each objective
 The goals, objectives, timing, budgets, beneficiaries, eligibility and selection
criteria, competent authorities responsible to grant incentives will be
established
 A responsible authority for implementing and monitoring the legal provisions
will be set up
FOREIGN TRADE,
IN THE PERIOD 2001 – 2006
EURO mill.
50,000
40,000
30,000
20,000
10,000
0
-10,000
-20,000
2001
2002
2003
2004
2005
2006
Exports
12,722
14,675
15,614
18,935
22,255
25,850
Imports
17,383
18,881
21,201
26,281
32,569
40,745
Balance
-4,661
-4,206
-5,587
-7,346
-10,314
-14,895
Source: National Institute of Statistics (www.insse.ro)
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GEOGRAPHICAL ORIENTATION OF THE
ROMANIAN EXPORTS, IN 2006
Top export markets
percentage of total export
America
3,4%
Asia - Oceania
2,5%
Africa - Middle East
6,3%
Europe
87,8%
Source: National Institute of Statistics (www.insse.ro)
Italy
17,9
Germany
15.7
Turkey
7.7
France
7.5
Hungary
4.9
Great Britain
4.7
Bulgaria
2.8
Austria
2.6
USA
2.5
Netherlands
2.4
Spain
2.3
Greece
1.9
Poland
1.8
Belgium
1.6
Serbia
1.5
GEOGRAPHICAL ORIENTATION OF THE
ROMANIAN IMPORTS, IN 2006
Top import partner countries
percentage of total import
Asia - Oceania
9.5%
America
4.6%
Germany
Africa - Middle
East
1.8%
Italy
Europe
84.1%
15.06
14.6
Russian Federation
7.9
France
6.5
Turkey
4.9
China
4.2
Austria
3.7
Hungary
3.2
Kazahstan
3.2
Poland
2,7
Great Britain
2.5
Czech Republic
2.5
USA
2.4
Spain
2.3
Netherlands
1.8
Source: National Institute of Statistics (www.insse.ro)
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TRADE BETWEEN ROMANIA AND AUSTRIA,
IN THE PERIOD 1999 – 2006
EURO mill.
2000
1500
1000
500
0
-500
-1000
1999
2000
2003
2004
2005
2006
Exports
227,5
271,3
502,3
589,9
691,81
685,15
Imports
284,3
359
748,6
918,74
1205,67
1535,33
Balance
-56,8
-87,7
-246,4
-328,7
-513,86
-850,18
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STRUCTURE OF THE BILATERAL
COMMERCE, BY MAIN GROUPS OF
PRODUCTS, IN 2006
Romanian Exports
Romanian Imports
• Machinery and electrical
• Machinery and electrical
• Furniture, toys and other – 10,8 %
• Plastics and rubber – 14,9 %
• Textile and garments - 8,9 %
• Metals and articles thereof – 9,5 %
• Metals and articles thereof – 7,9 %
• Transport equipment - 7,3 %
• Transport equipment - 7,6 %
• Chemical products – 5,3 %
equipment – 42,5 %
equipment – 35,1 %
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Austrian FDI’s in Romania
 Austria – ranking 2nd among the foreign investors in
Romania – 2 billion euro share-capital in Romanian
companies / 7 billion euro effective investments, according
to Austrian sources
 4192 companies with Austrian capital registered in
Romania
 Main sectors for Austrian investments: banking,
petrochemical industry, wood procesing, food industry
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TOP REASONS TO INVEST IN ROMANIA (1)
Market & Location Advantage :
• Second largest market in Central and Eastern Europe (over 21 million
inhabitants)
• Easy access to the countries of the former CIS countries, Balkans, the
Middle East and Northern Africa
• Junction of three prospective European transportation corridors nos. 4,
7&9
Resource Advantage:
• Skilled labor force, with solid knowledge in technology, IT and
engineering
• Rich natural resources, including fertile agricultural land, oil and gas
• Important potential for tourism
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TOP REASONS TO INVEST IN ROMANIA (2)
Economic Advantage
• Sustainable economic growth
• Functional Market Economy status
• Competitive tax policy
• Decreasing inflation
• Permanent financial assistance for SME's Development
• Structural funds
Improving Infrastructure Advantage
• Well-developed networks of mobile telecommunications in GSM
systems
• Highly developed industrial infrastructure, including oil and
petrochemicals
• Branch offices and representatives of various well-known
international banks
• Newly developed highway infrastructure
• Commitment to improve the highway infrastructure to EU standards
• Extensive maritime and river navigation facilities
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Potential Sectors for Investment





Manufacturing
Automotive parts
IT & Communication
Electric & Electronics
Wood processing





Construction materials
Textile
Food processing
Infrastructure
Outsourcing and
logistics
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THANK YOU !
MINISTER OF ECONOMY AND COMMERCE
ROMANIA
Phone: +40 21 202 51 40
Fax:
+40 21 202 51 77
E-mail:
varujan_vosganian@minind.ro
Website: www.minind.ro
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