- InvestRomania is a „one-stop-shop” for foreign investors who want to develop businesses in Romania representing for them an important point of support from the moment the business is at the project stage until it reaches its purpose. How are the projects that you coordinate within InvestRomania evolving?
- Invest Romania is the contact point in our country for the international business community, facilitating and promoting the access of foreign direct investments. InvestRomania supports foreign investors who are in the prospecting phase of the country or who are already present on the local market and want to expand their business.
As a „unique point of contact”, InvestRomania covers two components: investment promotion and project implementation. In order to implement investment projects, we provide continuous assistance and support services from the „zero” moment, throughout the decision-making process, including in the post-implementation phase. However, this implementation process is a long-term one (1-3 years), requiring support from central and local authorities as well.
InvestRomania’s activity is constant, currently having a portfolio of active projects whose value is approx. 3 billion Euros, which will generate a number of 19,000 jobs.
In addition, in the current geopolitical context, InvestRomania correspondingly offers support to companies affected by the armed conflict in Ukraine that want to relocate their activities to our country. In this sense, a working group was established at the Government level that manages this issue, of which InvestRomania is also a part.
The Government of Romania approved the Emergency Ordinance 147 of October 28, 2022 initiated by the Ministry of Entrepreneurship and Tourism (MEAT), the Prime Minister’s Chancellery and the General Secretariat of the Government regarding the establishment, organization and operation of the Romanian Agency for Foreign Investments and Foreign Trade. Many of the world’s states have resorted to this option, of establishing investment and export promotion agencies, and these entities are fundamental in their development strategies. Now, we shall also take this model of good practice. Thus, by separating the specialized structures from the MEAT, the „Romanian Agency for Investments and Foreign Trade” will be organized, an institution that will function under the Government and the coordination of the Prime Minister.
“The Romanian Agency for Foreign Investments and Export Promotion”, will have as its main objective the application of the Government’s policy for attracting foreign direct and portfolio investments in Romania, respectively in terms of promoting the export of Romanian products and services, exclusively in the field of tourism. The new institution will manage and implement even the Export Promotion Program – PPE, the Program to Support the Internationalization of Romanian Economic Operators (PINT), the Program for Romanian-Swiss Cooperation (PCER), as well as the Program for Large Investments in order to stimulate export capacity.
The agency will function as a specialized body of the central public administration, with legal personality, subordinate to the Government and coordinated by the Prime Minister, by taking over the activities, positions and staff of the Foreign Investments Directorate and the Foreign Trade Department, with the exception of the Commercial Policy Directorate, within MAT.
- What are the most attractive and sustainable areas of investment on the Romanian market at the moment?
- I begin by mentioning the fact that, in the period January-August 2022, foreign direct investments totaled 6474 million euros, up by 46.47% compared to the same period last year (according to the BNR release – „Balance of payments and external debt – August 2022” from 14.10.2022). These recorded values continue a positive trend that began in the latter part of 2020, despite the state of alert imposed by the authorities to combat the SARS-CoV-2 virus pandemic, as well as the armed conflict in Ukraine. Foreign investors have adapted to the new economic conditions, unlocking suspended investment projects and initiating new projects.
Going back to your question, I think areas like automotive and IT&C are still some of the most attractive sectors for foreign investors, along with construction, energy and agriculture.
It cannot be ignored that in Romania there are more than 630 car component manufacturers, whose parts are found in most cars manufactured in Europe. Also, research and development in the Romanian automotive sector continues to expand through new investments and high-tech activities.
The development of the IT sector has made it an enabler for the automotive sector, aerospace industry, chemical industry, agriculture and many others. By creating new partnerships or by strengthening existing ones between universities and the business environment, we become part of the Industry 4.0 revolution. Thus, Romania is increasingly positioning itself as a regional hub in the IT field.
- What are the things that entrepreneurs who want to invest in our country must take into account?
- Entrepreneurs who want to enter the Romanian market do not have a restriction in terms of the field in which to invest, but they must take into account the national and European legislation, Romania being an EU member state.
Regarding investments from non-EU countries, a framework for examining foreign direct investments has been established at European level. In this sense, any investment from outside the EU that exceeds 2 million Euros must go through a special commission for examining foreign direct investments from outside the EU.
- What are the ways to encourage foreign investors to choose Romania?
- Foreign investors who choose our country benefit from a series of competitive advantages and measures aimed at increasing the volume of investments in Romania. Starting with the fact that Romania represents one of the best performing European countries, with sustainable economic growth, being the second market in Central and Eastern Europe (CEE) and the largest in the European Economic Area (EEA). We have one of the most competitive tax systems in Europe.
Romania represents a business destination that offers high profit margins, having a well-qualified workforce, at competitive prices, with a good ability to overcome the cultural and linguistic threshold, the low level of taxation, low utility costs, fiscal facilities of stimulation of research and development, the existence of a network of 104 industrial parks.
At the same time, through the policy of the executive to attract foreign investments, investors can apply for state aid schemes to support the inflow of capital on the domestic market, for investments of over 1 million euros (HG 807/2014), which will generate over 100 new jobs of work (HG. 332/2014) and for investments intended for the manufacturing industry (HG 959/2022).
At the initiative of the Ministry of Entrepreneurship and Tourism, together with the Competition Council, in the second half of October a normative act GEO no. 140/19.10.2022 was promoted through which the Office for Industrial Licensing is established, which will have a single point of contact for submitting documents, only once. Through the single industrial license we remove administrative barriers and have the opportunity to accelerate the development process of new investments.
Entrepreneurs interested in entering the Romanian market can also call on the help of representatives from the Offices of Commercial-Economic Promotion, which are responsible for developing the country’s commercial-investment relations. The network is present in 56 states. The role of these economic attachés is also to identify partnerships between Romanian investors and those from other countries and even to find new outlets for Romanian products.
- It is well known that in recent years Turkish companies have made large investments in Romania. How do you evaluate the presence of Turkish investors on the Romanian market?
- Turkiye represents for us not only a reliable partner, but also a true friend of Romania, the relationship between our countries crystallizing and strengthening over time, through the realization of some investment projects in which common values and visions are found. The 144 years of diplomatic relations testify to our ability to build successful projects together.
The presence of Turkiye companies in Romania is significant, considering the many opportunities in various sectors: renewable energy, oil industry, trade, construction, infrastructure (naval, road, air), textile industry; I would like to mention only a few of the many Turkish companies present on the domestic market: RULMENTI SA (KOMBASAN) (steel industry), ERDEMIR (heavy metals), ETI EUROPEAN FOOD and BALKAN DAIRY (food processing), KASTAMONU, DENTAS ROMANIA, YILDIZ ENTEGRE (woodworking), KULAK CONSTRUCTION (construction), ANCHOR Group (real estate) EUROWEB (Turk Telekom subsidiary) (communications).
On December 31, 2021, Turkiye ranked 18th in the top of the investor’s countries of origin immediately after the value of the FDI balance (874 million euros). However, the BNR appreciates that the value of Turkish investments in Romania is higher, namely 1767 million euros (of which 1,220 million euros in greenfield enterprises), if we include the capital invested by Turkish companies with regional headquarters in other countries, especially in Europe.
According to the National Trade Registry Office of Romania (September 2022), Turkiye ranks 15th in terms of subscribed capital, with approximately 17,400 registered companies, representing approx. 7% of all companies with foreign investment. In 2022 alone, almost 170 companies have been registered so far. The balance of direct investments in Turkiye on December 31, 2021 reached the level of 21 million euros.
Turkiye is Romania’s most important commercial partner outside the EU and, in my opinion, it is mandatory that we continue to capitalize on the economic dimension of the strategic partnership we have together.
The Romanian Ministry of Entrepreneurship and Tourism, with the support of the Romanian Chamber of Commerce and Industry, has organized the Romania-Turkiye Business and Investment Forum on March 31, 2022, in Istanbul – Turkiye.
Among others, Mr. Sorin GRINDEANU, Deputy Prime Minister of Romania, the minister of transport and infrastructure as well as Mr. Lucian RUS, Secretary of State from MEAT, were part of the joint intergovernmental commission. This meeting is part of the actions to promote Romanian exports and attract Turkish investments.
- What future projects does InvestRomania have?
In order to attract new foreign investments, InvestRomania makes efforts to widen the investment area and by promoting the less developed regions of Romania, with a greater availability of labor. The Ministry of Entrepreneurship and Tourism, through the Foreign Investment Directorate, manages negotiations with foreign investors interested in the domestic business offer, but until the completion of these projects, the discussions are confidential.
Since my appointment as Secretary of State, the main objectives have been to increase the value of FDI in Romania, through significant investment projects in terms of value and the formation of new jobs, and the country’s notoriety as a business destination in the region. Together with the Foreign Investments Directorate team, which I coordinate, we want to bring to Romania value-added, technologically advanced, innovative investments that can generate a major economic impact.
Translation and interpretation: Authorized Translator AIVAZ YASEMIN