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March 24, 2023

Romania still a viable option for German investors

General Manager of AHK Romania, Sebastian Metz said that despite investment conditions being seen rather negatively, business expectations are being met.
Despite investment conditions being seen rather negatively, the overall picture is positive and Romania is still a viable option for German investors. Thus, according to a press release, participants in the Conjecture Questionnaire for Eastern and Central Europe conducted by the Romanian and German Chamber of Commerce and Industry (AHK Romania) were satisfied with the location of the investment. 83% of participants would choose Romania again as place of investment, even though the percentage was lower compared to last year (2012: 89%).
“This shows that, despite problems, business people’s expectations are being met, so committing to Romania is worth it”, Sebastian Metz, General Manager of AHK Romania stated. According to the conjecture questionnaire, the most appealing investment location in Eastern and Central Europe is Poland, followed by the Czech Republic. Before this year, the Czech Republic had been dominating the ranking since 2006. Companies criticised Romania, sometimes very harshly, but German investors said they would not renounce this place of investment. Our country has dropped one place in the eye of investors, compared to last year and is currently 11th among 20 countries that participated in the questionnaire.
The trade volume between Romania and Germany was reported at approximately EUR 18 billion last year, according to AHK Romania data. At the end of last year, Germany was third in foreign investments, with 19.000 German share capital companies, the equivalent of EUR 4.43 billion.
“We hope that the current government, that owns parliamentary majority, will meet these challenges from a pragmatic, sustainable and consistent standpoint”, the General Manager of AHK Romania stated. Expectations concerning the situation of companies for this year are mostly positive. Even if the number of positive evaluations has decreased compared to last year (2013: 36%, 2012: 42%), half of the companies estimate that the situation will improve this year (2012: 46%). Over one third of the participants in the questionnaire want to invest more and hire personnel, while only 14% are thinking of personnel reductions, which proves that German investors are contributing to investments and creating job opportunities. Approximately 30% are expecting an improvement in the opportunities for every branch and only 19% expect the situation to worsen in their branch. Last year, only 17% of participants believed the situation in their branch would improve, while 15% believed it would worsen.
Companies included available human resources among the most important investment criteria. Labour market conditions ranked high among the investment selection criteria and these include a combination of costs, qualifications and productivity, in addition to reduced workforce costs. According to the majority, the costs and productivity ratio is good, which offers German companies a reason to be active in Romania. According to the questionnaire, a lot of catching up must be done in the field of professional training. The personnel usually meet company requirements and the business environment is considered to be satisfactory, but the political and economic framework conditions were seen negatively by German companies. 27% of the companies are extremely dissatisfied with access to financing sources (2012: 19%). The infrastructure is another topic on which 52% of participants stated they were dissatisfied (2012: 32%).
Most companies want the euro currency to be introduced in Romania (52%), but the percentage has decreased considerably compared to previous years. In 2009, over 80% of the participating companies believed it was necessary to switch to euro currency.

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