SIMILAR ARTICLES

How much of public investment represent European cohesion funds: a situation at EU level with Romania in the list

One of the major struggles regarding the next EU Multiannual Financial Framework refers to the level of cohesion funds to be allocated to member countries… Mai mult

Romania’s debt costs: Yield of government bonds compared to countries in the region

The yield of long-term Romanian government bonds was 4.28% in January 2020, according to Eurostat data. That is well above all the other states of… Mai mult

Reversed trend in mutual funds: Romanians invested more money than they withdrew. They look for funds with government bonds

Net subscriptions in Romanian mutual funds (the difference between invested and withdrawn amounts) became again positive in 2019 after they had been negative in 2018.… Mai mult

Romgaz has started exploitation of richest onshore gas deposits discovered in 30 years

Romgaz (SNG) announced the start of production in the deep area of Caragele deposit (Buzau), the biggest discovered in the last 30 years and one… Mai mult

4.9% – Romania’s spectacular public deficit in Q3. 2 times more than anyone else in the EU

Romania managed again to stand out at the EU level by recording the highest level of the public deficit in the third quarter of 2019,… Mai mult

Cronicile

Chance that Romania ignores: rapidly growing small businesses. An analysis in the EU context

de Marin Pana 2.11.2016

economie-pib-crestere-300x174Romania ranks the second-to-last among EU member states in terms of number of enterprises rapidly growing (see the definition below), with a share of only 2.3%, four times lower than the European average.

In these businesses, there are almost 200 thousand employees working, i.e. 6.7% of the total number of people employed, a slightly better positioning only because it exceeds half of the EU average.

Definition of concept – An enterprise with rapid growth – ICR – (at least 10%) is an enterprise that has an average increase of the number of employees exceeding 10% per year during three years and has at least 10 employees at the beginning of growth.

Only the small Cyprus is after us at a very small distance, with 2.2% and 70 enterprises having less than 5,000 employees, which makes the country statistics less relevant and places us far away from the rest of Europe (see table below) just at the bottom of the European best business practices.

1-2

  • Businesses with rapid growth in the EU member states, in 2014
  • Country           Businesses                  Employees                  No of employees/ICR
  • Number % of total*     Number % of total*
  • *active businesses with at least 10 employees
  • Source: Eurostat, own calculations

This is a position that asks for an in-depth analysis of data of and urgent actions from the decision makers. Especially that just above us in the EU ranking, Italy presents a share of the ICR businesses almost triple.

This situation suggests that we have a big problem in this area, difficult to explain only by statistical variations.

As a development model, it would be useful for us to observe two important countries having the same share of enterprises with rapid growth that are among the top three foreign trade partners of Romania, Germany and France. Germany’s number of ICR businesses and related employees is more than double compared to our Latin sister, which reflects the positive effects of a more pronounced entrepreneurial spirit.

In the Balkans, close to us, Bulgaria and Croatia have much higher shares of ICR businesses than us, above the threshold of 10% and the European average.

Noteworthy for those who strive or not to create favourable conditions for the business environment, neighbours from the south of the Danube also have the highest share of employees in ICR enterprises at the EU level, after Ireland and UK.

The other neighbour from the EU, Hungary, also ranks among the first countries in terms of share of ICR companies and almost equals Bulgaria in terms of percentage of employees working in such enterprises. If we also looked at the situation in the Baltic countries, we should seriously pay attention and ask ourselves questions about the perspective of the Romanian enterprises’ competitiveness.

Finally, Poland, our model similar in terms of size, level of development and structure of the economy obviously outperforms us with an ICR percentage above the European average. Placed where it should be, in terms of size and interest, next to Spain.

Noteworthy, for the umpteenth time, the lack of data on Greece for a more specialized and complex statistical research. It is hard to say whether this was because of the crisis faced by the country following the wrong decisions that led to the explosion of public debt or the lack of information and / or neglection of statistical data contributed to the crisis outbreak.

If the we make the ratio of the number of employees to the number of enterprises with rapid growth, Romania stands out very easily, as the EU country with the highest average (163 employees / ICR), nearly twice the European average, of only 84 employees / ICR. This situation suggests that the problem is very localized at the level of small business, and given the average, it less affects the medium and large enterprises.

Somehow paradoxically, precisely this very poor position that we currently have in terms of small businesses with rapid development creates potential for growth and an opportunity to take measures for stimulating those businesses that wish to grow and create new jobs.

This is an essential factor for the economic development, maintaining competitiveness and the balance of budget.

Mergeți în homepage ›

Publicat la data de 2.11.2016

Lăsați un comentariu


NEWS

Shareholders of Galati steel plant promise investments of one billion euros

GFG Alliance has committed to invest one billion euros to upgrade Galati steel plant in order to reduce emissions and increase production. Another EUR 1… Mai mult

Transport Ministry announces it has sent to Brussels the financing request for Sibiu - Pitesti highway

The Transport Ministry, as the Intermediate Body in Transport, approved the financing request for the project "Construction of Sibiu - Pitesti highway", Sections 1, 4… Mai mult

Romania and Juncker Plan: EUR 720 million attracted, of which 35% by Transgaz for BRUA

(The map of investment financed through Juncker Plan, by GDP share. Darker colours mean higher shares) The operator of national natural gas pipelines, Transgaz (TGN)… Mai mult

Top 3 reasons why young people leave Romania

Lack of trust in authorities, corruption and low living standards are the main reasons why young people leave Romania. The data is part of a… Mai mult

IMM Invest Romania – program implementing rules have been published

The Ministry of Public Finance announces that it has issued the methodological norms for the implementation of the Program for supporting small and medium-sized enterprises… Mai mult

Pollution import and car park expansion: comparisons with the other EU states

Romania is the EU country with the fewest cars in terms of the number of inhabitants, according to data recently published by Eurostat. We appear… Mai mult

Government is trying to save budget deficit: reductions in public administration system, cancellation of bonus for harmful conditions, excise duty on soft drinks

The Government is preparing the public for the first measures aimed at avoiding the budget slippage, which would be applied by the PSD-ALDE government. News… Mai mult

Laura Codruta Kovesi remains alone in the race for European Chief Prosecutor

French Prosecutor Jean-Francois Bohnert will be appointed as head of the European Financial Prosecutor's Office, a position for which he was heard on Thursday, 11… Mai mult

Romania - EU country with highest risk of dying in a road accident, Bulgaria is quickly decreasing number of victims since it built motorways

Romania recorded the highest road deaths in the EU also last year, with 96 deaths per one million inhabitants in 2018, almost double the EU… Mai mult

Latest developments in progress at Health Ministry: Differentiated wages based on performance, competitions organised at a regional level not by hospitals

Sorina Pintea announced on Thursday further new changes that will be brought to the functioning of the health care system, including new rules for employment… Mai mult

ANAF changes selection procedure for liquidators. Main changes

The new order on approval and selection procedures for insolvency practitioners is an important step to a very good direction, industry experts say. ANAF is… Mai mult

Romania loses competition for a seat at UN Security Council. MAE Excuse: Campaign started too late

Romania lost to Estonia in the final vote to get the non-permanent member position within the UN Security Council for the period 2020-2021. On Friday,… Mai mult

Business internationalization / eMAG makes a step to entry five new international markets and targets a business of EUR 2 billion

eMAG hopes to get the opinion of the Hungarian Competition Council over the next two months for the acquisition of Extreme Digital, the market leader… Mai mult