Radio România Internațional

Tag: foreign investment

  • Romania and Foreign Investment

    Romania and Foreign Investment



    Bringing foreign investors to Romania has been a top priority for all the cabinets that have governed the country since the anti-communist revolution of 1989. Unfortunately, successful privatizations have been accompanied by haphazard deals which more often than not were to the detriment of both the state and local communities. Some enterprises have been taken over by incompetent people, who thought they could get them up and running, but have utterly failed. Others have been purchased in bad faith, for their assets alone. Moreover, many of these privatizations are still subject to corruption investigations.



    On Thursday, the Economy Ministry announced that the state would buy the majority stake in the DMHI Mangalia Shipyard, currently owned by a South-Korean group. More specifically, it will be a joint venture, with the Romanian Economy Ministry owning 51% of the shares, while Damen Shipyards Group of the Netherlands will buy from the South – Koreans the remaining 49% of the shares. “It is for the first time in the last 28 years that the state takes over a privatized strategic industrial objective. As the majority stakeholder, we can now effectively protect state interests as well as the highly qualified workforce of this shipyard”, reads a Ministry press release.



    The desperate financial situation of the company has already resulted in hundreds of workers leaving the company. In the last and a half year no negotiations have been held with the company leadership with a view to raising salaries. With more details on that, here is the trade union leader Laurentiu Gobeaja:



    “Everyone knew about our problems for years: that the number of ships was going down and we were about to be faced with severe production cutbacks. No decision was made in that respect, and over the entire period we continuously notified the Ministry and the company leadership that we were worried by the lack of work. The last ship we built was shipped off on February 7. Since then, the 700 employees have had little work to do, as the docks are empty and the shipyard is half-deserted. I dont think there will be much activity at the shipyard in the near future; maybe in a year or two, but only if things improve”.



    During her visit to Dambovita County, the Romanian Prime Minister Viorica Dancila met with foreign investors at the Ulmi industrial platform, where the largest house appliance production unit in south-eastern Europe is currently under construction. On this occasion, the Romanian official said the Government was looking for ways to attract more investments.



    Prime Minister Viorica Dancila: “I will support investments in Romania. I will work with my team of ministers to find ways to make Romania more appealing to Romanian and foreign investors.



    Business people should be encouraged to invest in Romania, Viorica Dancila also said. This can only be done by concrete measures, such as a stable legal framework and a European-level infrastructure.




  • Romania’s President speaks about foreign investment

    Romania’s President speaks about foreign investment


    According to Romanias President Klaus Iohannis, foreign investment is not an adversary to Romanian entrepreneurship, but a genuine partner, offering increased business opportunities and models of effective management. Attending a reception hosted in Bucharest by the Romanian-German Chamber of Commerce, the president underlined that the Governments priority in 2018 should be the business sector, which has recently been facing unexpected challenges with regard to the quality and predictability of economic policies. President Iohannis argued in favour of a robust economy, based on a responsible governing program and predictable policies.



    Klaus Iohannis: “As with every government, I want to call on the new one to pay attention to their responsibility to ensure Romanias economic stability above anything else. The future Government should understand it is important not to jeopardize fiscal sustainability and Romanias long-term development potential by means of ill-advised and risky measures. I will hold talks with the new Cabinet and call a consultation with decision-makers on the sustainability of their economic measures”.



    The president also recalled the downward trend of public investment, adding that it is not enough to have budget allocations for investment only “on paper”. These investments should be actually made, and thus stop neglecting key sectors such as infrastructure. Romanian economy fares extremely well figure-wise, but the figures unfortunately do not reflect the quality of economic policies, with the business sector managing to report progress rather despite such policies.



    Klaus Iohannis has warned that, although Romania reported a record-high economic growth at EU level in 2017, lawmakers had difficulties observing the budget deficit target of 3% of the countrys GDP, as stipulated in the budget and fiscal framework. Against the background of careless fiscal policies, they had to take extraordinary measures, such as the reintroduction of the additional excise duty on fuels, taking on additional dividends from state-owned companies or blocking payments to credit release authorities towards the end of the year. Add to that the chaos generated by the changes to the Fiscal Code, which nearly everybody has criticized, and the result is a blatant disinterest on the lawmakers part in ensuring the economic predictability the business sector wants, President Iohannis went on to say. The President believes, however, that the business sector will manage to uphold its priorities and consolidate its achievements through transparency and open dialogue with the countrys decision-makers.