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January 28, 2022
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Philippe Vlerick, Chairman and CEO of Vlerick Group: Romania offers benefits related to its geographic positioning and as one of the foremost markets in CEE

Mr. Philippe Vlerick, Vlerick Group is a large industrial and financial holding company. Please detail for our readers the  structure of group activities. What are the most important?

 

Vlerick Group is a Belgian family-owned diversified group active across selected industries and selected geographies, including Western Europe, Eastern Europe, India and the United states.

The group is sub-divided into 4 main pillars:

1)    Industrial activities, including wholly- or jointly owned industrial operations and core industrial participations;

2)    Long term and active participations in stock-listed enterprises;

3)    Private Equity; and

4)    Real Estate

Vlerick Group evolved from a carpet manufacturing business, BIC Carpets, started nearly 60 years ago and to this day remains especially committed to the successful continuation and development of its industrial activities, both in its home country and abroad.

Represented industries include the textiles industry as well as the metallurgy industry. Most companies are headquartered in Belgium but have an international presence.

 

Vlerick Group conducts business in Romania, too. In which year did you start your business in Romania?

 

We started our activities in Romania in 2005 via the establishment of UCO Tesatura, an integrated denim factory in Giurgiu with current capacity of approximately 6m meter.

In 2006, UCO Tesatura formed an integral part of the joint venture between Vlerick Group denim-producing company UCO Sportswear and Indian textiles market leader Raymond Ltd.

Additionally, Vlerick Group is an active partner in the Belgian BMT Group. BMT Group operates in a number of highly specialist niche sectors of the metallurgical industry: in the manufacturing of industrial gears and gears for the aerospace industry as well as in the manufacturing of container glass moulds. The 22 production plants under the umbrella of this group are located in 10 European countries as well as in the United States, Turkey and China. BMT has been operating in Romania since 1998 through its production facilities all located in Iasi.

Our combined industrial activities in Romania are employing 1300 people.

In addition to its industrial activities, Vlerick Group also has an active presence in Romania via its real estate operations through the company Vlerick Vastgoed (Real Estate) and its Romanian subsidiaries. Vlerick Vastgoed develops high-quality projects with a unique design. The class A office building complex Brasov Business Park is the most significant example of such projects, with its clear emphasis on high-quality as well as on energy efficiency. It is currently hosting over 1,000 professionals from various renowned international companies.

 

Do you think that the  business environment in Romania is friendly, is attractive?

 

As you would notice, we have been active in Romania for quite some time and the decision to invest in this country and to continue to do so has been driven to a large extent by the business-friendly attitude of its citizens, which we experienced at all levels of interaction, from business partners to the people we work with on a daily basis.

Regarding our industrial activities, we benefit from a qualified labour force with thorough knowledge in the fields of technology, IT, as well as engineering, and who take pride in a job well done, which is essential to the success of any (business) venture.

Additionally, for us as an international group, Romania offers certain benefits related to its geographic positioning and as one of the foremost markets in Central and Eastern Europe. In that respect, Romania’s accession to the EU as a member state in January 2007 has significantly helped the country in developing a wider and more solid international economic network and continues to propel the country forward in a stable and sustainable way. The resulting increasing interest from foreign companies to be active and invest in Romania should be viewed as a token of confirmation in that regard.

 

What are the shortcomings of the business environment in Romania to be more favorable for foreign investors?

 

In my opinion and on the basis of our experience through our different activities in Romania, it is important to work on the improvement of the stability in the administrative and fiscal rules and regulations in Romania. The legislation and its application and interpretations are to this day too much subject to variations, complexity and opaqueness as well as more generally lacking predictability and legal certainty. We have experienced this in various domains, such as company law, fiscal and accounting law, and especially in matters relating to VAT regulations.

An additional important item for further growth is a continued investing in the development of a network of highways and railways to European standards. We have been pleased to see that this is one of the main priorities of the current government and that a significant amount of infrastructure projects are currently taking place.

 

What are the Group’s projects for 2015 and following years on the Romanian market?

 

Regarding our industrial activities, we want to grow as well in the textile sector as in the sector of metallurgy.  First of all by using the manufacturing capacity, we invested in, up to 100 %. Secondly by increasing this capacity there where needed. And finally by developing and creating within our businesses, products with higher added value.

Regarding our Real Estate projects, we intend to initiate the construction of the second phase of Brasov Business Park, the completion of which will increase the capacity with nearly 30,000 sqm and provide high-quality office space for additional national and international service companies looking for a (increased) presence in the region.

In addition to that, we are projected to develop an industrial area of ​​25 ha in Brasov, along the DN13 in order to provide medium to large industrial, logistical and big box retail players with purpose-built facilities.

Our increasing investments in Romania are a token of our continued confidence in the country’s long term potential as well as of our desire to further develop and strengthen our partnership with the country’s various stakeholders.

 

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