The evolution of the foreign direct investments in Romania (original) (raw)

The foreign direct investments in Romania � contradictories trends

Annals of University of Craiova Economic Sciences Series, 2008

Romania attracted large inflows of foreign direct investments (FDI), thanks to an improved business environment and still-low labor costs. Romania offers to the foreign investors many major reasons to invest in Romania: great market potential, strategic location, significant natural resources, high skilled labor force, high potential for economic growth, new EU member, infrastructure growing steadily, friendly business environment, access to European funds, competitive taxation. But still there are possible many contradictories evolutions generated both by Romanian government decisions and by the influence of the external factors. Virtually, the size on the above potential shows the countries with low FDI potential but strong FDI performance. The same time, the United Nations Conference on Trade and Development (UNCTAD) matrix considers that Romanian economy has less advantages than the Romanian Agency for Foreign Investment (ARIS) offers. Therefore, Romania is below potential wanted by foreign investors. Therefore many challenges must be addressed to enhance competitiveness and to attract additional FDI. The Foreign Investors Council (the FIC) from Romania believes that Romania must still improve the enforcement of new laws and regulations; tackle major social reforms, including reform of the labor market; increase its competitiveness and improve its infrastructure.

Foreign Direct Investments and Regional Development in Romania

2012

After the year 2000, as business was improving and the flat tax was introduced, the positive perception of Romania by partners has attracted major capital flows in the national economy. Although industry is unanimously considered to be a major source of economic and social imbalance, yet in time it has proved to be by far more attractive to foreign investors than agriculture and tourism, which have a remarkable potential in this country. Major foreign investments are located in the main urban centres, because they are more easily accessible and more open to establishing relations and have a more dynamic economic milieu. Bucharest continues to hold a dominant position, either by hosting foreign companies, or simply their headquarters. Next come the regional capitals, basically cities with more than 300,000 inhabitants, with a large sphere of influence and capacity of coordinating the regional economic space. Moreover, present evolutions have shown that Romania is likely to loose its cheap labour advantage, a situation that makes its further attractiveness for international investment flows really questionable.

THE DYNAMICS OF FOREIGN DIRECT INVESTMENT IN ROMANIA AFTER EU ACCESSION

2010

Identification of potential investment of the countries in the current context is one of the main important problem of the world economy because the investments, particularly foreign ones, is considered the key factor for economic growth and development. Foreign direct investments are an alternative source for financing the national economy, with a tendency in recent years of a positive effect on the Romanian economy. This paperwork highlights the role of foreign direct investment in Romania's economical growth potential, with major impact on employment, on the economic modernization, technology transfer and on the living standards. At the same time the article analyzed and highlights the contains of the current trend of foreign direct investments, structure and dynamics after Romania joined the European Union and their geographical distribution on the main development regions. Keywords: foreign direct investments, role of foreign direct investments, development regions, economic growth JEL Classification: R12, E22 C CE ES S W Wo or rk ki in ng g P Pa ap pe er rs s, , I II I, , ( (4 4) ), , 2 20 01 10 0 120 An accelerated growth in recent years has placed Romania among attractive FDI destinations. Consequently, the investors interest in Romania has increased steadily in recent years. Cheap and skilled workforce, low taxes, improving the business environment, the positive attitude of foreign partners and favorable geographical location are the main advantages of Romania for foreign investors. Thereby, as can be seen above, Romania has registered an upward trend in attracting foreign direct investment. In 2008, Romania attracted investments worth EUR 9496 billion placing her an enviable position on the statistics that analyzes foreign direct investment flows in South Eastern Europe. As expected, the economic crisis has affected the amount of FDI attracted by Romania, in 2009 recorded a drop regard previous year, leading to the 4556 billion euros. The number of FDI projects has almost halved in 2009 in Romania, while the volume of newly created jobs has decreased by 44%, according to a study released by Ernst & Young. Romania recorded in 2009 a 48% reduction of the number of FDI projects and a deceleration of 44% in the creation jobs, compared to 2008. According to that study, in 2009 Romania has attracted 75 foreign direct investment projects, representing 2% of the total projects in Europe, and generated 6384 new jobs, or 5% of all Europe. Thereby, in 2009 Romania ranked seventh in the European rankings in creating jobs, respectively, ranked 11th by token of the market share in total FDI. The same study shows that in 2008 in Romania were created 11,403 new jobs through the 145 FDI projects. Despite the rather difficult period our country is passing through, Romania is still considered an attractive destination for industrial projects, in 2009 Romania drew about 7 percent of total European investment projects. In 2009, FDI in Romania was also decrease by 48,4% from 2008, to 4556 billion Euros, according to statistics of the national bank. Investments financed the current account deficit at a rate of 96,9% last year. Intra-group loans accounted for 37,4% of FDI, amounting to 1834 billion Euros and equity, including reinvested profits, 62,6%, or 3065 billion Euros in 2009, according to statistics of National Bank of Romania. From the point of orientation for foreign investors into industries (according to NACE Rev. 2), FDI was located mainly in industry (41% of total). On the next place is filled by the financial and insurance sector, followed by construction and real estate, commercial, and telecommunications. Within industry, manufacturing industry attracted the largest volume of investment (31,1%). C CE ES S W Wo or rk ki in ng g P Pa ap pe er rs s, , I II I, , ( (4 4) ), , 2 20 01 10 0 Ivan, M. V., Iacovoiu, V. (2008) Rolul investiţiilor străine directe în contextul obligativităţii indeplinirii criteriilor de convergenţă, Studii financiare.

Aspects regarding the evolution of the foreign direct investments in Romania between 1990-2007

2009

Abstract Foreign direct investments (FDI) are the engine of the economic development in the developing countries, but also in the high developed ones. FDI played an important role in the Central and East-European countries integration in the world economy; these former communist countries had non efficient economies, and at the beginning of the transition they did not had the physical and financial capital, necessary for the reorganization and economic growth.

Foreign Direct Investments in the Romanian Economy in a Regional Context

Annals - Economy Series, 2012

Foreign direct investments represent the most important and stable source of external financing of all states of the world, irrespective of their level of development. In Romania’s path from the elimination of the centralized economy and up to nowadays, foreign direct investments were also a source of economic growth, a financing source, and a means of acceleration in the process of transition, a contributor to the capitalization of the wealth of the country but also a real barometer of the economic situation. The aim of this article is to analyse the foreign direct investment flows in the Romanian economy after 1990 according to the 3 stages of qualitative evolution of the Romanian market economy : the period of transition to the market economy (1990-2003), the period of the market economy, of pre-accession to the Union (2004-2006), the period of the first 4 years of membership in the European Union (2006-2010), the main focus of the research being on outlining the place of the nat...

Foreign Direct Investments. Determinants for Romania

ERN: Other Institutions & Transition Economics: Macroeconomic Issues (Topic), 2012

This paper tries to provide a brief and comprehensive view on the foreign direct investment (FDI) in Romania. Besides, FDI will be viewed in the regional context of the CEE and EU member countries. Some common and specific features of FDI will be here approached and some conclusions will be drawn. (1) Data on the net inflow will develop on recent periods, see the one around financial crisis. (2) Less significance for the current FDI stock is kept by current and newly added inflows. (3) FDI by economic activities broadly regards the links between foreign capital inflow and home development. (4) By home inside regions, FDI will be seen as both creating imbalances among regions and contributing to the regional development. (5) By country sources, all the CEE countries mostly receive their FDI from the western part of Europe and EU. Finally, (6) by FDI types, the same inflow gets strongly dominated by corporate development.

Foreign Direct Investments in the Economic Development of Romania

Studies in Business and Economics, 2015

The economic theories consider the investments as one of the major factors of economic growth. Economic growth represents a complex process of increasing the dimensions of the national economy, based on the collective use of increasingly efficient production factors, dimensions expressed by the size of gross domestic product and national income per capita.

The Evolution of the Foreign Direct Investment in Romania and the Effect on the Economic Growth

2019

Nowadays, the development of each country is conditioned by the existence of the capital. The public sources of investment are frequently limited depending on the different interests, so the foreign direct investment represent an important source for economic growth including in the period when the economic stability is in danger. The main objective of this paper is to evaluate the impact of the foreign direct investments in Romania and to offer a clear image on the effects resulted from the activity of the companies with foreign capital present in Romania. We will present the effects of the foreign direct investments in general trying in the same time to emphasize the results of the companies with foreign capital compared with the Romanian ones.

Influence of net direct investment in Romania's economic development, in the international context

A central objective of the paper is rendering an image of the international economic context and the location of Romania on international and EU economic stage and also a complementary analysis of external economic relations. Also, using the multidimensional analysis of the impact of FDI on the trade balance and on the current account it will classify and bring to date a number of relevant studies that capture the determinants of FDI for Romania. In addition, the paper will also touch another goal, namely, making forecasts that aim for future image on the impact of foreign direct investment in Romania from the EU.