Romania and foreign investors
The dynamics of foreign investments in Romania indicate a slowdown, reaching a level close to that reported during the pandemic.
Roxana Vasile, 10.04.2025, 14:00
A German concern will open a new factory in Romania that will produce components for passenger aircraft, Prime Minister Marcel Ciolacu announced on Wednesday. Although the international economic situation is complicated, Romania continues to attract important investors, the Prime Minister said, adding that the German concern, which supplies components to aeronautics giants, chose Romania, among other things, for its strategic position between East and West. Reality indicates, however, that Romania’s investor appeal and the dynamics of foreign investments are slowing down. The reasons are related to the geopolitical context, the size of the budget deficit, but also to political and fiscal uncertainty. The looming trade war following the US administration’s decision to impose substantial customs tariffs, including on imports from the European Union, further affects investors’ confidence and willingness to take risks.
Under these circumstances, on the same day that Prime Minister Ciolacu announced the German investment in Romania, the country’s interim president, Ilie Bolojan, also had a meeting with representatives of the Foreign Investors Council, an association that includes the most important foreign capital investors in Romania, with a cumulative turnover accounting for approximately one fifth of Romania’s GDP. It is not the government or president that changes a country, Ilie Bolojan pointed out, but the people of that country and the companies that invest there. Politicians, on the other hand, have an obligation to create conditions and predictability, so that performance is rewarded, and lack of work or performance is sanctioned, the president said. What should Romania do to become one of the top 10 economies of the European Union? President of the Foreign Investment Council, Daniel Anghel explains:
“The average annual investment effort should reach approximately 35% of GDP over 2024-2030, and going further, over 2031-2040, the average investment effort should be somewhere around 28-30% of GDP. These figures are not exactly easy to achieve. The context we find ourselves in is not at all encouraging, but we believe that, with a good strategy, with dialogue that brings together all the important players to the table, both from the business and public sector areas, we could grow at a faster pace than we have done so far”.
In other words, Romania can boost its regional competitiveness with the help of major economic players, if strategic measures are taken to encourage major investments with high added value. At least this was one of the main conclusions of talks between Foreign Investors Council representatives and interim president Ilie Bolojan. (VP)
