SIMILAR ARTICLES

BNR – Risk map: Credit default risk got right to “high” level top position

The deterioration of investors’ confidence in emerging economies and the default risk of loans to companies and population are the biggest risks to financial stability… Mai mult

A (new) paradox: Public debt decreases as a share of GDP – cost increases with interest to what we borrow. Remarks

Although medium- and long-term foreign debt (DETML) has declined steadily over the last four years related to GDP, the amount paid for this debt has… Mai mult

Current account deficit – 15% higher after first four months of 2018

The current account of the balance of payments registered a deficit of EUR 2,053 million in the first four months of this year, about 15%… Mai mult

We and Juncker Plan: Bulgaria – 3rd position, Romania – 23rd position. How other neighbours are doing

The value and economic impact of the Romanian projects to attract resources from the so-called “Juncker Plan” of European investments are much lower, compared to… Mai mult

Sovereign Fund has been voted: Mechanism to remove “states’ pearls” from public control

The voting machine of the Chamber of Deputies (decision chamber) approved on Wednesday – 174 votes for, 98 against and 3 abstentions – the Law… Mai mult

Foreign investment in 2015: strengths and weaknesses

de Marin Pana , 20.12.2016

investitii-300x198Foreign direct investment (FDI) in Romania reached EUR 64,433 million last year, equivalent to 40% of annual GDP.

Centralized BNR data shows that 70% of this amount (EUR45,098 million) was contribution to the equity (including reinvested earnings) of foreign firms. The remaining 30% represented the net credit received from abroad (EUR19,335 million).

This is the result of the overall FDI increase in all fields of activity by more than four billion euros, while construction and real estate have gained nearly half of this increase (+ EUR 1.96 billion).

Noteworthy is that new investment in manufacturing (+ EUR1.2 billion) have surpassed investment in trade (EUR 0.8 billion).

a-3-768x516

*

  • FDI structure evolution by main economic activities between 2014-2015
  • FDI stock                    as at 31 December 2014        as at 31 December 2015        Change
  • Activity                        Amount (MEUR)
  • Industry, of which:
  • – Extractive industry
  • – Manufacturing
  • – Electricity, natural gas, water
  • Financial intermediation and insurance
  • Trade
  • Construction and real estate
  • IT&C
  • Professional and technical activities
  • Transportation
  • Hotels and restaurants
  • Other activities
  • Source: BNR

*

Professional and technical activities represented a point of obvious interest for the foreign investors and contributed almost one billion euros, which is not bad at all if we consider our target to develop higher added value sectors. Somewhat surprisingly, the IT segment’s position has plus of only 92 million, which could raise questions.

Contrary to the public rhetoric and idea that we have a country with a remarkable tourist potential, the hotels and restaurants segment shows a minus EUR 37 million compared to the previous year.

To which much larger negative amounts are added from the extractive industry (about EUR -1.4 billion ?!) and electricity, natural gas and water (with a declining trend toward about EUR 400 million).

To bear in mind, the tangible and intangible assets advanced between 2014 and 2015 by only EUR 87 million, from EUR 30,883 million to 30,970 million. As a result, it turned from a majority to a minority contribution to FDI (from 51.3% to 48.1 %). That indicates a certain decrease of the FDI stability.

Evolution of productive activity of the FDI companies

The productive activity of the companies with foreign capital has been increasing throughout the period 2009 – 2015, except for a slight turnover decrease in 2014 and a temporary decrease of employed in 2010 (see table). Moreover, 2015 marked the point of crossing the threshold of 1.2 million people who found work in the FDI enterprises.

b-1-768x297

*

  • Evolution of the FDI enterprises’ turnover and average annual number of employees between 2009-2015
  • Year    Turnover (MEUR)       Average number of employees (thousand persons)
  • Source: BNR, FDI in Romania in 2015

*

Overall, foreign direct investors in Romania obtained net income last year amounted to EUR 3,746 million. The amount is the result of EUR 6,038 million profits, less the reported losses worth EUR 3,129 million (balance of EUR 2,909 million). It should be mentioned that dividends distributed to foreign investors amounted to EUR 2,399 million and EUR 510 million represents the reinvested profit.

Net interest income amounting to EUR 837 million paid on loans granted by parent firms to their enterprises in Romania added to the balance of approximately EUR 2,9 billion.

Related to the size of the economy, we note that, on the whole, net income by foreign investment in Romania represented in 2015 approximately 2.2% of GDP.

Finally, we should also mention the importance of the FDI enterprises in terms of foreign trade, as they contributed 69.4% of total exports and 62.8% of the imports (and even more, 77.8% of exports and 77.1% of imports in the manufacturing industry). It should be noted the reverse of this ratio in the services segment (55.1% to 56.9%) and, especially, in trade (35.2% to 47.8% of the total for this sector).

Mergeți în homepage ›

Publicat la data de 20.12.2016

Lăsați un comentariu


NEWS

Subsidy of RON 900/month for employing a graduate based on contracts of indefinite duration

The National Agency for Employment (ANOFM) grants subsidies of RON 900/month to employers who employ graduates of educational institutions, with contracts of indefinite duration, within… Mai mult

C.P. Tariceanu, before the heads of Senates from EU: The European Commission has encouraged the parallel state, in Romania it is like in the 50's

Calin Popescu Tariceanu (foto) delivered a very tough speech on Friday, in the Senate, addressed to the European Commission, which he accused of encouraging the… Mai mult

National Bank of Romania wants to lower indebtedness limit in granting loans to individuals

The National Bank of Romania (BNR) sent to banks for consultation a draft amending Regulation 17/2012, which provides for a consistent lowering of the indebtedness… Mai mult

High impact provisions: Senate has adopted PSD-ALDE amendments to the Code of Criminal Procedure

Senators adopted on Wednesday the draft for amending the Code of Criminal Procedure, by 74 votes for to 28, against. The bill goes to the… Mai mult

RBL: Workforce crisis is worse than economic crisis - 3.4 million Romanians have left the country in last 10 years

Migration is one of the most serious problems facing Romania at this time, along with the lack of infrastructure. However, the return of Romanians to… Mai mult

World Bank: Romania's economy could grow by 5.1% in 2018

Romania's economy could grow by 5.1% in 2018, according to the World Bank summer forecast. The estimate has been improved by 0.6 percentage points above… Mai mult

Ministry of Energy: Natural gas from Black Sea will be exported through Onesti - Isaccea - Negru Voda network

The Ministry of Energy issued for Transgaz the construction permit for the consolidation of the transport system between Onesti (Bacau) and Isaccea (Tulcea) and for… Mai mult

Energy productivity: Romania goes up within Central European group

Romania reached 56% of the EU's average energy productivity in 2016, compared to only 43% in the year of the accession, according to data released… Mai mult

Document / Public procurement - Changes made by OUG: how to calculate guarantees, values over which contract must be publicly announced, how to change contract without resuming procedures

Under the promise of reducing bureaucracy and increasing efficiency in the public procurement procedure, the Government approved on Thursday an emergency ordinance that brings essential… Mai mult

AmCham: Romania should have a national investment plan. Four major areas with competitive potential

The consistency of the measures needed to encourage public and private investment, as well as proposals for the development of the four major areas considered… Mai mult

"We are pulling ourselves out of maps!": Business community’s solutions for infrastructure development

In the medium and long term, companies in Romania lose business because of disarticulated infrastructure; the country overall loses new investment, the state budget loses… Mai mult

New Romania’s Agent at the EU Court of Justice: 32 years old, failed exams, a person supported by Olguta Vasilescu

The government agent at the EU Court of Justice, Razvan Horatiu Radu, was replaced by the Government by a decision of Prime Minister Viorica Dancila… Mai mult

European Commission urges Government to "fully and immediately" reimburse car taxes

The European Commission asks Romania to urgently align the system of taxes collected on the car registration to the European one. The request is announced… Mai mult

CCR President in a visit to Russia, despite that Ministry of Foreign Affairs has recommended not to make this visit

CCR President Valer Dorneanu is in Russia today, where he attends the Sankt Petersburg International Legal Forum, despite that MAE has recommended not to make… Mai mult

List of black payments / Corruption in health sectors: Bribes - 25% of contract value, higher than in other fields

Romania is the European country with the lowest spending in the health sector. However, DNA statistics show that the bribe in this field is higher… Mai mult