Romania

Romania, with year on year GDP growth at 8.8%, is currently the fastest growing economy in the EU. It is beginning to resemble the period before the financial crisis of 2008, where Romania was known as a “tiger” economy due to the growth rates it produced regularly, as high as 8 or 9%. Nevertheless, despite this exceptional performance, there are still some fundamental structural issues which should be achieved for ensuring a sustainable economic development. The IT services sector, as well as manufacturing in areas such as electronics and car production, are where Romania exhibits a comparative advantage over other countries in the region. Foreign direct investment is also a main driver behind this, with net inflows at around 3% of yearly GDP in 2016.

Centenary of the Great Union of 1918 & The Birth of the Romanian Modern State

In the annus mirabilis 1918, at the end of the bloodiest war history had ever known, Romanians fulfilled their most cherished political ideal: the unification of all provinces where they were in the majority – Transilvania, Banat, Crisana, Maramures, Basarabia, and Bucovina – with the Old Kingdom of Romania in one democratic, national state. Follow year by year and struggle by this momentous achievement and learn more about the men and women who wrote, with a life of courage and vision, the greatest Romanian story ever told. It was a lesson of patriotism which will remain a brilliant example for the entire period passed ever since. The authors of this Great Union taught us a sacred lesson, namely that of unity, solidarity, giving up vain selfishness, placing national interest higher than personal or group ambitions, promoting tolerance and mutual respect. This year marks the Centenary of the Great Union of 1918, and the birthday of the Romanian modern state. 

The new Romania born then has made in the following decades great efforts to promote, domestically and externally, to the highest standards of the time, the values of tolerance, fairness, and respect. These values remain today at the core of our policies. December 1 is celebrated by Romanians all over the world as a symbol of solidarity, hope and triumph against adverse circumstances. It reflects, to this day, Romania’s attachment to the principles of tolerance, mutual respect, peaceful coexistence and respect for cultural values of all people. Currently Romania is on an ascending economic path and has the highest rates of annual economic growth within the European Union. That is not only a statistical fact, but also a reality already reflected in the living conditions of our people. We are enjoying in Romania, today, unprecedented development, security and welfare in our history. Our collective duty is to protect them, secure them in the medium and long term, being prepared for contexts that may be less favorable to us. We owe to consecrate a future Romania, preserving what is particular and authentic of its specific values and, at the same time, the most dynamic and pro-European, important and creative within the EU.

ECONOMIC ENVIRONMENT OF ROMANIA

Romania’s macroeconomic situation is one of the strongest in the EU in terms of GDP growth, fiscal deficit and public debt, inflationary pressures and current account balance, with positive evolutions expected by some credit rating agencies. The GDP growth rate was 4.9 in 2016, the highest in EU28, with forecasts maintaining a positive outlook. Economic growth has been robust since 2013, driven by strong exports and strong industrial output in 2013 – 2015. At the same time, a gradual recovery of domestic demand took place during 2014 – 2016. Real GDP was estimated to have increased up to 4.9% in 2016 on account of surging consumption and recovering investment. At current prices, the nominal GDP is above EUR 160 billion according to Eurostat. On the production side, growth was fueled by the recovery of two important sectors (construction and industry). At the same time, on the demand side there was a strong surge in private consumption and investments due to increase in wages and fiscal incentives. Estimated growth for 2017 was 5.2%, according to the National Prognosis Commission, following the pro-growth fiscal policy, including tax cuts, and the positive economic evolution from the past years. In 2015, FDI net flow stood at EUR 3,461 million.

The FDI net flow went primarily to trade (EUR 1,000 million) and to financial intermediation & insurance (EUR 926 million). Significant FDI flows (EUR 745 million) were also channeled to manufacturing, its main sub-sectors that benefited from foreign direct investment being transport means (EUR 532 million), oil processing, chemicals, rubber and plastic products and machinery and equipment (EUR 183 million each) and manufacture of computer, electronic, optical and electrical products (EUR 133 million).

RENEWABLE ENERGIES

Romania belongs among those countries that have been notably supporting the development of the market with renewable energies. Generally, all renewable energy production resources and systems (the “RES”) are promoted (only some inefficient system types are ineligible for support). The electricity market is liberalized and the volume of investments in RES is increasing. Current share of the renewable energy corresponds approximately to 12% of total electricity production in Romania and is expected to grow (as proclaimed by EU the 20% share is the goal in 2020). There are huge expectations regarding the amount of MW to be newly installed and the development of many projects has already begun. 

Romania's climate and geographical position-with the Black Sea to the east, the Carpathians in the center and the Danube crossing the territory in the south-provides many opportunities to exploit its renewable energy sources. For over 30 years, Romania’s most important source of clean energy has been large hydropower plants. Up to and including 2009, other renewable sources accounted for only a very small share of electricity production in Romania. In 2010 the situation began to change dramatically in favor of renewable energy sources (other than large hydropower plants and especially wind.

AVIATION IN ROMANIA

Romania has a rich tradition in aviation. At the beginning of the 20th century, pioneers such as Aurel Vlaicu, Traian Vuia and George Valentin Bibescu made important contributions to early aviation history, building revolutionary aero planes and contributing to the international scene. Romania has a well-developed airport infrastructure compared to other countries in Eastern Europe. There are 16 commercial airports in service today, most of them opened for international traffic. Four of the airports (OTP, BBU, TSR, CND) have runways of 3,100–3,500 meters (10,171–11,483 ft) in length and are capable of handling jumbo jets. Six of the airports (BCM, CRA, IAS, SBZ, SCV, and SUJ) have runways of 2,400–2,700 meters (7,874–8,858 ft) in length, while the rest of them have runways of 2,000–2,200 meters (6,562–7,218 ft) in length.

TAROM: 

Romanian Air Transport was founded in 1954 and over the years has grown into a first-class air carrier, servicing much of the European continent and beyond. With its home base in Bucharest, TAROM operates flights to destinations in Europe, North Africa and the Middle East. The Romanian flag carrier currently owns one of the youngest fleets in Europe consisting of Boeing 737, Airbus 310/318 and ATR42/72 aircraft.

TAROM is a modern and future-oriented airline, respecting the environment by implementing innovative procedures that reduce CO2 emissions. Quality of service and professionalism are the principles that have guided TAROM since the founding of the airline over half a century ago. TAROM joined SkyTeam in June 2010, after finalizing a two-year integration process.

AUTOMOTIVE SECTOR OF ROMANIA

The Romanian automotive market has been growing by 18% year-on-year average since 2009 and is forecasted to exceed EUR 20 bn by 2020. It is the 4th biggest automotive manufacturer in Central and Eastern Europe (CEE). In the last decade more than 600 OEMs for automotive supplies opened plants in Romania following the investments of 2 big automotive manufacturers at Craiova and Mioveni. Production of vehicles almost doubled between 2005 and 2015 with automotive production peaking in 2013 with almost 411,000 vehicles. Production in 2015 was bigger by 192,300 vehicles compared with the end of 2005. The OEM sector has grown alongside automobile production, accounting for growing demand. In the past few years, the local components market has developed considerably, driven by both local and external demand. What is more, components produced in Romania are of a wide variety, with 600-800 original equipment manufacturers. As such, it is no surprise to see the component export grow even during crisis years. 

DACIA-RENAULT GROUP: 

Commercialized in over 40 countries on 4 continents, Dacia is the most important and best known Romanian car brand. Its birth certificate comes after the conclusion, in September 1966, of a cooperation agreement between the Romanian state and Renault, following which the Pitesti Car Plant was established. It was to begin its activity in August 1968, when the Dacia 1100 started being manufactured under Renault license. A year later the production of Dacia 1300 started as a true symbol of the brand in the 70s. After the cooperation with Renault ceased, the company went through a difficult period, succeeding however to maintain a dynamic activity that will enable it to be among the champions of the Romanian industry even in the complicated context of the first years after the 1989 revolution. The contract with Renault will be resumed in the 90s. On the 2nd of July 1999 the contract through which the French group became the majority shareholder of the Mioveni car manufacturer was signed. Dacia thus the 2nd brand of the Renault group. Following an ample and ambitious investment program, Dacia undergoes a thorough modernization and transformation process that will reach a climax with the launch of the Logan model in 2004.

Symbolic of the true renewal of the brand, Logan is the starting point not only for the development of the Dacia range, but also for a fast-flowing international expansion. Currently the Dacia line-up comprises 8 models (Sandero, Sandero Stepway, Logan, Logan MCV, Lodgy, Dokker, Dokker VAN and Duster) covering the most important segments of the automotive market in Romania. Internationally, Dacia established itself as a true symbol of dynamism and commercial success. Thus, over 90% of the Mioveni car plant production is exported, mostly to Western Europe. Always interested in constantly evolving its cars, Dacia wants to stay a brand close to its customers, offering cars easy to run in everyday life, at the best quality/ performance/price ratio. 

FORD-ROMANIA: 

Ford Company came to Romania in 1935, after a negotiation with the Romanian government. The company started the first car production line in Eastern Europe at the Ford Romania facility in Floreasca. Models were produced until World War II when the plant was taken over by the occupying forces. Vehicle production at the plant began in September 2009 with the Ford Transit Connect, and later with the Ford B-Max. Engine production at the plant includes three and four-cylinder versions of Ford’s EcoBoost engine family. The plant has a production capacity of 300,000 units per year and it is the country’s third company by value of exports. In March 2016, it was announced that the Ford EcoSport will be built at the Craiova plant starting from the autumn of 2017, moving production for the European market from the current plant in Chennai, India. This happens on the background of the growing market for the SUV segment in Europe, and will bring an investment of 200 million to the factory.

ROMANIAN IT SECTOR

Romania is one of the fastest-growing information technology (IT) markets in Central and Eastern Europe. The country has made significant progress in all of the information and communications technology (ICT) subsectors, including basic telephony, mobile telephony, the Internet and IT. The country’s telecoms sector has been deregulated, expanded and modernized over the past 15 years. Romania is the leader in Europe, and sixth in the world, in terms of the number of certified IT specialists, with density rates per 1,000 inhabitants greater than in the US or Russia. There are almost 100,000 specialists in the IT sector. Approximately 5,000 of the 30,000 engineers graduating every year in Romania are trained in ICT.

Romania has been a favored IT outsourcing destination for many years, with competitive advantages including its domestic market of 20m, one of Europe’s fastest-growing economies, and young graduates with good language skills. The country can also build on its communist legacy of excellence in science, mathematics, and technical education. The focus is shifting to using these to develop homegrown innovative companies. Entrepreneurship has been boosted by the demand for skilled professionals. A number of cities now boast budding start-up scenes, most notably Bucharest and the Transylvanian university city of Cluj, as well as Brașov and Timisoara.

Currently Romania controls 5 percent of destinations for many years, with competitive advantages including its domestic market of 20m, one of Europe’s fastest-growing economies, and young graduates with good language skills. The country can also build on its communist legacy of excellence in science, mathematics, and technical education. The focus is shifting to using these to develop homegrown innovative companies. Entrepreneurship has been boosted by the demand for skilled professionals. A number of cities now boast budding start-up scenes, most notably Bucharest and the Transylvanian university city of Cluj, as well as Brașov and Timișoara. Currently Romania controls 5 percent of the offshore software development market and is the third leading country (after India and China) among software exporters. Such growth of software outsourcing in Romania is caused by a number of factors. One of them is the supporting role of the Romanian Government. The Government has launched a program promoting construction of IT-oriented technology parks – special zones that have an established infrastructure and enjoy a favorable tax and customs regime. Another factor stimulating the IT sector growth in Romania is the presence of global technology corporations such as Intel, Motorola, Sun Microsystems, Boeing, Nokia and others, which have intensified their software development activities and opened their R&D centers in Romania.

AGRICULTURE IN ROMANIA

The historic provinces of Wallachia, Transylvania, Moldavia, Dobruja, and the Banat have distinct soil and climatic conditions that make them suitable for different types of agriculture. The breadbasket of Romania is Wallachia, which provides half the annual grain harvest and roughly half the fruit and grapes. Truck farming, especially in the Ilfov Agricultural District surrounding Bucharest, is also important. Despite the fertility of Walachia’s soil, yields fluctuate considerably from year to year because of recurrent droughts. Transylvania, which receives more precipitation than Walachia, has poorer soils and more rugged terrain that restricts large-scale mechanized farming. Livestock raising predominates in the mountains, and potatoes and grains are the principal crops in the central basin. Moldavia has generally less fertile soil than Wallachia and receives scanty rainfall. Its primary crops are corn, wheat, fruit and grapes, and potatoes. 

The Banat region has a nearly ideal balance of rich chernozem soils and adequate precipitation. Grain, primarily wheat, is the principal crop; fruits and vegetables are also important. Dobruja, a region of generally inadequate rainfall, was becoming agriculturally more important during the 1980s, because much of the marshland in the Danube Delta was being drained and brought under cultivation. The traditional crops of Dobruja are grain, sunflowers, and legumes. MAJOR CROPS: Corn and wheat (predominantly of the winter varieties) occupied nearly two-thirds of all arable land and about 90 percent of all grain lands. Corn, the staple of the peasant diet, was grown on 3.1 million hectares in 1987, while wheat was sown on 2.4 million hectares. Other important grains included barley (560,000 hectares), oats (70,000 hectares), rice (47,000 hectares), and rye (42,000 hectares). Among the major non grain crops, the most widely grown in 1987 were hay (870,000 hectares), sunflowers (455,000 hectares), potatoes (350,000 hectares), soybeans (350,000 hectares), sugar beets (271,000 hectares), feed roots (70,000 hectares), corn silage (50,000 hectares), and tobacco (35,000 hectares). Wine and table grapes were widely grown, but the best vineyards were in Moldavia. Romania had gained a reputation for fine wines as early as the nineteenth century, and subsequently became one of the major producers of Europe.

TOURISM IN ROMANIA

Romania offers countless unique travel experiences. A journey of three to four hours, by car or train, can take you from the Danube River to a beautiful, intact, medieval town; from Bucharest - Romania’s capital city - to the Black Sea; from Southern Transylvania to the historic regions of Bucovina or Maramures. Take a step back in time as you visit one of the unique painted monasteries in Bucovina, the perfectly preserved hilltop citadel of Sighisoara or an authentic, centuries-old, village in Maramures. The countryside is the heart and soul of Romania, where peasant culture remains a strong force and medieval ways prevail like nowhere else in Europe. Recognized as the world’s third most biologically diverse area, the Danube Delta has been recognized by UNESCO for its outstanding universal value. Romanians’ vivid imagination and intense spirituality have always been expressed through their architecture, music, crafts and traditions. With a terrain that ranges from steep and challenging to gentle and pleasant, Romania also offers bikers of all skills and levels something to enjoy. 

DANUBE DELTA: 

After passing through several countries and absorbing countless lesser waterways, the Danube empties into the Black Sea south of the Ukrainian border. The Danube Delta (Delta Dunarii), included on UNESCO’s World Heritage list, is one of Romania’s leading attractions. At Tulcea, the river splits into three separate channels: The Chilia, Sulina and Sfântu Gheorghe arms, creating a constantly evolving 4187-sq-km wetland of marshes, floating reed islets and sandbars. The region provides sanctuary for 300 species of bird and 160 species of fish. Reed marshes cover 1563 sq km, constituting one of the largest single expanses of reed beds in the world. The delta is a haven for wildlife lovers, birdwatchers, fishers and anyone wanting to get away from it all for a few days. There are beautiful, secluded beaches at both Sulina and Sfântu Gheorghe, and the fish and seafood, particularly the fish soup, are the best in Romania. BRAN CASTLE: Rising above the town on a rocky promontory, Bran Castle holds visitors in thrall. An entire industry has sprouted around describing it as ‘Dracula’s Castle’, though connections to either the historical Vlad Tepes or Bram Stoker’s fictional vampire are thin.

The liberties taken with Bran’s reputation are quickly forgotten on a visit. It is really a unique experience to climb up on its conical towers, admiring views over thick forest, and stroll through creaky-floored rooms furnished with bearskin rugs and 19th-century antiques. 

BUCOVINA MONASTERIES: 

Bucovina’s painted monasteries are among the most distinctive in all Christendom. They are cherished not only for their beauty and quality of artisanship, but also for their endurance over the centuries and their overall cultural significance. The half-dozen or so monasteries scattered over a large swathe of Bucovina, date mainly from the 15th and 16th centuries, a time when Orthodox Moldavia was battling for its life with forces of the expanding Ottoman Empire. The monasteries are hailed mainly for their colorful external frescoes, many of which have survived the region’s cruel winters relatively intact. The external wall paintings served as both expressions of faith and as an effective method of conveying important biblical stories to a parish of mostly illiterate soldiers and peasants. But don’t pass up the rich interiors, where every nook and cranny is filled with religious and cultural symbolism.