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3 Benefits of E.U. Accession Removal of any obstacles in the trade with EU Member States Removal of any obstacles in the trade with EU Member States Common Trade Policy with third countries Common Trade Policy with third countries Harmonization of entire legislation, capital market regulations, taxation, accounting rules => higher transparency and simplification Harmonization of entire legislation, capital market regulations, taxation, accounting rules => higher transparency and simplification Structural funds (31 billion euro for ) Structural funds (31 billion euro for ) Open gate for EU towards CIS, Asia, Middle East, Northern Africa 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 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) Romania-important role in assuring the energy security for Europe (major transit pipelines, energy production & supply)
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11
CONSULATE GENERAL OF ROMANIAOffice for Commercial-Economic
Promotion
ROMANIA Member of the European Union
ECONOMIC DEVELOPMENTS AND OPPORTUNITIES IN ROMANIA
Gabriel DUTU Chicago, April 14 2010
22
ROMANIAROMANIA
- Area: - Area: 238.391 sq. 238.391 sq. km.km. - Population: - Population: 21,700,00021,700,000 - Counties: 41- Counties: 41
CAPITAL: CAPITAL: BucharestBucharest
Basic Information
33
Benefits of E.U. Benefits of E.U. AccessionAccession
Removal of any obstacles in the trade with EU Removal of any obstacles in the trade with EU Member StatesMember States
Common Common TTrade rade PPolicy with third countriesolicy with third countries Harmonization of Harmonization of entire legislation, entire legislation, capital capital
market regulations, taxation, accounting rules market regulations, taxation, accounting rules => higher transparency and simplification=> higher transparency and simplification
Structural fundsStructural funds (31 billion euro for 2007-2013)(31 billion euro for 2007-2013) Open gate for EU towards CIS, Asia, Middle Open gate for EU towards CIS, Asia, Middle
East, Northern AfricaEast, Northern Africa Participation in major projects in the Black Sea Participation in major projects in the Black Sea
Extended Area and in the Central Extended Area and in the Central & & Eastern Eastern European RegionEuropean Region
Romania-important role in assuring the energy Romania-important role in assuring the energy security for Europe (major transit pipelines, security for Europe (major transit pipelines, energy production energy production & supply& supply))
FLATFLAT TAX TAX 16%16%VATVAT 19%19%
DIVIDEND DIVIDEND TAXTAX 10%10%
AVERAGE AVERAGE WAGE WAGE (2009)(2009) 625625 USDUSD
MINIMUM MINIMUM WAGE WAGE
207207 USDUSD
Competitive TaxationCompetitive TaxationCountrCountr
yyCorporatCorporat
e Taxe TaxRomanRomaniaia
16%16%
HungaHungaryry
16%16%
SlovakiSlovakiaa
19%19%
PolandPoland 19%19%EstoniEstoniaa
20 %20 %
SloveniSloveniaa
25%25%
Czech Czech Rep.Rep.
28%28%
55
Macroeconomic Macroeconomic Performance Performance
GDP real growthGDP real growth
4.9 4.9
8.3
4.2
7.9
6.27.1
-7.2
7.1
-6.1-5.4
-3.2
2.1
5.73.93.9
1.5
1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
66
5.2%
40.7%
30.3%
14.1%
7.9%4.8%
6.6%9.0%9.3%
17.8%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Macroeconomic Macroeconomic Performance Performance Inflation rateInflation rate
77
Macroeconomic Macroeconomic Performance Performance
Unemployment rateUnemployment rate
9.56.6
8.910.411.810.5 8.8 8.1
7 6.2 5.95.2 4 4.4
7.6
0
5
10
15
%
1995 1997 1999 2001 2003 2005 2007 2009
88
COUNTRY COUNTRY RATINGSRATINGS ROMANIA ROMANIA
Fitch Fitch - - BBB-BBB- ((NovemberNovember 20020088))
CofaceCoface - A4 - A4 ((SeptemberSeptember 200 20099)) JCRJCR - BBB- BBB ((FebruaryFebruary 200 20099)) MoodyMoody’’ s s - B- Baa3aa3
((SeptemberSeptember 200 20099)) Standard & PoorStandard & Poorss - BB- BB+ + ((OctoberOctober
20020088))
99
Foreign direct investmentsForeign direct investments - million- million USD USD--
7567 7611
2841
7033
10585
1326313226
17701889
02000400060008000
100001200014000
2001 2002 2003 2004 2005 2006 2007 2008 2009
FOREIGN DIRECT FOREIGN DIRECT INVESTMENTINVESTMENT
Total Total FDI’s until 3FDI’s until 31.12.2009: 1.12.2009: 31.731.7 billion billion USDUSD
1. Netherlands - 18.49%2. Austria - 12.23%3. Germany - 10.49%4. France - 8.18%5 . Cyprus - 5.06%6. Italy - 4.31%7. U.S.A - 3.34%8. Spain - 3.23%9. Great Britain - 3.04%
Source: National Trade Register Office
NNoo
Country of Country of originorigin
Number Number of of
companicompanieses
Share-capital Share-capital in Romanian in Romanian companiescompanies- - mil. USDmil. USD - -
11 NetherlanNetherlandsds 3,4563,456 5,8635,863
22 AustriaAustria 5,3755,375 3,8703,870
33 GermanyGermany 16,6616,6644 3,3263,326
44 FranceFrance 5,8735,873 2,5942,59455 CyprusCyprus 4,2554,255 1,6051,605
66 ItalyItaly 26,9826,9844 1,3671,367
77 U.S.A.U.S.A. 5,7555,755 1,0591,05988 SpainSpain 3,4513,451 1,0241,024
99 Great Great BritainBritain 2,8532,853 963963
1111
Value of Subscribed Capital Value of Subscribed Capital
by Field of Activityby Field of Activity
Source: Romanian Agency for Foreign Investment
Industry50.7%
Retailing5.3%
Wholesale6.4%
Transport6.2%
Construction1.3%
Tourism 1.4%Agriculture
0.9%
Services27.8%
1212
Foreign Investor Foreign Investor AdvantagesAdvantages
foreign investment allowed in all sectors of foreign investment allowed in all sectors of economyeconomy
possibility to freely manage the company with possibility to freely manage the company with full ownership rightsfull ownership rights
full repatriation of capital and profitsfull repatriation of capital and profits
protection against expropriation and protection against expropriation and nationalizationnationalization
national treatment for foreign investorsnational treatment for foreign investors
1313
FOREIGN TRADE 2001 – 2009
-40,000
-20,000
0
20,000
40,000
60,000
80,000
100,000
Exports 18,574 21,462 22,796 27,645 32,492 37,741 43,142 49,076 42,509Imports 25,379 27,566 30,953 38,370 43,889 54,909 69,162 75,632 56,789Balance -6,805 -6,140 -8,157 -10,725 -11,397 -17,168 -26,020 -26,571 -14,280
2001 2002 2003 2004 2005 2006 2007 2008 2009
USD mill.
Source: National Institute of Statistics (www.insse.ro)
1414
MAIN TRADE PARTNERSMAIN TRADE PARTNERSTop import partner countriesTop import partner countries
percentage percentage of total import of total import
GermanyGermany 16.3616.36
ItalyItaly 11.3811.38
HungaryHungary 7.397.39
Russian FederationRussian Federation 5.975.97
FranceFrance 5.715.71
TurkeyTurkey 4.924.92
AustriaAustria 4.884.88
KazakhstanKazakhstan 4.584.58
ChinaChina 4.224.22
HollandHolland 3.733.73
PolandPoland 3.433.43
Czech RepublicCzech Republic 2.502.50
BelgiumBelgium 1.991.99
SpainSpain 1.961.96
Great BritainGreat Britain 1.951.95
Top export partner countriesTop export partner countriesppercentageercentage of total export of total export
GermanyGermany 16.5016.50
ItalyItaly 15.4615.46
FranceFrance 7.387.38
TurkeyTurkey 6.616.61
HungaryHungary 5.115.11
BulgariaBulgaria 4.164.16
Great BritainGreat Britain 3.293.29
HollandHolland 2.892.89
UkraineUkraine 2.462.46
SpainSpain 2.312.31
AustriaAustria 2.272.27
PolandPoland 1.991.99
GreeceGreece 1.811.81
Russian FederationRussian Federation 1.811.81
U.S.A.U.S.A. 1.691.69
1515
FOREIGN TRADE IN 2009FOREIGN TRADE IN 2009 Total volumeTotal volume: 99,299.27 million USD : 99,299.27 million USD
( 25.2% down to 2008)( 25.2% down to 2008) ExportExport: 42,509.79 million USD (13.9% down to 2008) : 42,509.79 million USD (13.9% down to 2008) ImportImport: 56,789.47 million USD (32.1% down to 2008): 56,789.47 million USD (32.1% down to 2008)
Romanian – USA TradeRomanian – USA Trade: : TotalTotal: 1,415.95 million USD 34% down to 2008 : 1,415.95 million USD 34% down to 2008
(2,154.9 million USD) (2,154.9 million USD) Export : Export : 743.5 million USD 33% down to 2008743.5 million USD 33% down to 2008
(1,106.7 million USD)(1,106.7 million USD) Import : Import : 671.6 million USD 36% down to 2008671.6 million USD 36% down to 2008
(1,048.2 million USD)(1,048.2 million USD)
1616
AMERICAN SUCCES STORIES IN AMERICAN SUCCES STORIES IN ROMANIA: ROMANIA:
MAIN INVESTORSMAIN INVESTORS FORD MOTORFORD MOTOR GENERAL ELECTRICGENERAL ELECTRIC ORACLEORACLE QUALCOMM QUALCOMM MICROSOFTMICROSOFT HONEYWELL INTL.HONEYWELL INTL. PROCTER & GAMBLEPROCTER & GAMBLE COLGATE PALMOLIVECOLGATE PALMOLIVE SMITHFIELD FOODSSMITHFIELD FOODS KRAFT FOODS INTL.KRAFT FOODS INTL. UNITED GLOBAL COMUNITED GLOBAL COM DELPHIDELPHI JOHNSON CONTROLSJOHNSON CONTROLS EMERSON ELECTRICEMERSON ELECTRIC CITIBANKCITIBANK CAMERONCAMERON
1717
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
TOP TOP REASONS TO INVEST IN ROMANIAREASONS TO INVEST IN ROMANIA (1) (1)
1818
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
TOP TOP REASONS TO INVEST IN ROMANIAREASONS TO INVEST IN ROMANIA (2) (2)
1919
Potential Sectors for InvestmentPotential Sectors for Investment
• ManufacturingManufacturing • Automotive partsAutomotive parts• IT & IT &
CommunicationCommunication• Electric & Electric &
ElectronicsElectronics• Wood processingWood processing
Construction Construction materialsmaterials
TextileTextile Food processingFood processing InfrastructureInfrastructure Outsourcing and Outsourcing and
logisticslogistics
2020
CONSULATE GENERAL OF ROMANIACONSULATE GENERAL OF ROMANIAOffice for Commercial-Economic PromotionOffice for Commercial-Economic Promotion
Phone: 312.573.8150Phone: 312.573.8150Fax: 312.573.9771Fax: 312.573.9771
E-mail: E-mail: [email protected] Website: Website: www.roconschicago.org
THANK YOU !THANK YOU !