Posted Sep 11, 2013 in Business environment, Comments on actual news 0

And after Rosia Montana what? Which is Romania’s strategy to attract investments in a “difficult” international environment

Ok, I got it. We don’t want the foreigners to exploit the Romanian goldmines. Good to know, case closed.

So what do we want by the foreigners? To leave totally? To remain in the country? To invest in it? In which sectors? On what criteria? Are we going to offer them stability or will we tell them “you invest your money and then we see what happens afterwards”?

A “difficult” international environment

The situation in Europe and the world is at least “difficult” right now:

It looks like we avoided a major conflict in Syria, which remains to be confirmed next week. But the war was too close to become reality.
Eurozone “grows” with 0,6%, while the Southern countries continue their decline, from the “modest” -2% of Italy and Spain, to the ongoing Greek aggressive GDP deduction (-4 or 5%) etc.
Unemployment grows in most of the European countries, while their public debt rises as a % of the GDP.
The financing cost in many parts of Europe is almost 10%, which means that there is no financing, or no competitive industry if it pays this financing.
Even for migration things get difficult. Romanians and Bulgarians are just the ones that “make noise” while emigrating. In the same time tens of thousands of Greeks, Spanish or Italians compete for the same jobs around the globe.
Yen currency is 30% cheaper (to Euro) than it used to be 9 months ago. Indian Rupee lost 25% (to Euro) in the last 2 months, while the Brazilian Real is down with 20% (to Euro).
(For the ones who see only up to their nose, this means that European currency becomes more expensive and European companies become less competitive, so exports will not grow as much as we need. But exports are any country’s oxygen right now…)

Romania: So far so good (when foreigners are involved)

Romania so far is stable from macroeconomic point of view. No matter what is everyone’s opinion about the politicians of this country, Romania has avoided all dangers that have caused major problems to several other countries.

Its economy mainly exploits 3 sectors:

Agriculture
IT (with export orientation)
Industry with export orientation (not directed to the local consumption)

This week we were happy to find out the new successes of Romanian exports, which reached very high figures in July, helping the economy to remain competitive and slashing the biggest part of the foreign current account deficit.

From top 100 exporters, 96 of them are not Romanians

According to all analyses, companies with foreign capital contribute a great part to Romania’s success in exports. You can check some recent articles here:

While Romanian entrepreneurs make great steps to become competitive and reach their place in the economy map, an objective observer should notice that so far foreigners have added value to Romanian economy.

(Of course we can always discuss regarding “what Romania should be nowadays, if Romanians would have resolved all their problems by themselves, without to need anyone else” etc. But in this kind of discussions please include me OUT. Economy is not about feelings and wishes, but about facts, numbers, plans, strategies and much work).

After Rosia Montana what?

The country should state its strategy and explain its priorities to investors, Romanian and foreign ones

All known countries of Western world search for foreign investors to invest their money in their country. If you see the subvention scheme for investments in USA (some States), Austria, Germany, France etc., you would be shocked. You have the impression that “Romania is sold to foreigners”, while even the biggest economies of the planet are doing everything possible for the foreigners to invest there. Especially now, with the crisis entering its 6^th year and the problems mentioned above, the competition between countries will increase furthermore.

During 2013, Romania made some decisions regarding foreign investments. I am the last one who will “judge” these decisions. Right now, the question is if we can discuss seriously about the country’s future, leave aside the “lovely” populism and inform the foreign investors for the country’s priorities over the following years.

In which sectors Romania wishes to attract investments?
What is it going to offer for these investments to be implemented?
How stable will be the situation for the company that will place its money in the country?

Enough with Rosia Montana. The case is closed. Romania has plenty of other options for investors and now it is the time to focus on the priorities of the country for the future, to secure its position even in the worst-case scenario.

I insist that this is the priority now to discuss. Or maybe your prefer talking about stray dogs?

What is your opinion?