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Antalya, March 2007

Antalya, March 2007. ROMANIAN INVESTMENT CLIMATE Stimulative for New Business and Expansions Ph.D. Iustina Lutan - Councelor Romanian Agency for Foreign Investment. Eye on Romania. You are looking at your next location in Eastern Europe…. ROMANIA.

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Antalya, March 2007

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  1. Antalya, March 2007 ROMANIAN INVESTMENT CLIMATE Stimulative for New Business and ExpansionsPh.D. Iustina Lutan - CouncelorRomanian Agency for Foreign Investment

  2. Eye on Romania You are looking at your next location in Eastern Europe… ROMANIA … access to high competencies and a growing market, where the costs are low and the quality is high…

  3. Macroeconomic Data Totalpopulation (million) GDP per capita (EUR, 2006) Vienna Institute of International Economic Studies

  4. Great potential for growth GDPGrowth rate Solid economic fundamentals • Rapid real GDP growth • Declining inflation • Declining unemployment, currently at 5.4% (average in 2006) Steady credit rating improvement • Moody’s increased its rating from B3 in 2000 to Ba1 (positive) currently • S&P and Fitch ratings increased from B- in 2000 to BBB- (positive) currently Inflation rate National Bank of Romania, National Commission for Prognosis

  5. EU financial assistance to Romania, 2007-2013 • Financial support provided by E.U. to Romania during 2007-2013 is up to Euro 30 billion through structural and cohesion funds; • Romanian coordinating authority – Ministry of Public Finances

  6. Competitive Taxation • Central and Eastern European countries are trying to follow the successful Irish example – to have faster economic growth through low taxes CEE-CIS Tax Notes - PriceWaterhouseCoopers

  7. Competitive Labor Cost The average gross monthly wage in Romania is the second lowest after Bulgaria It is expected to grow by 12% yearly 1213 713 648 637 504 326 181 Slovenia Czech Rep Hungary Poland Slovakia Romania Bulgaria Gross monthly wages EUR Regional Comparison 2006 - EUR Vienna Institute of International Economic Studies, Romanian Central Bank

  8. ValuableHuman Potential • high performances in international competitions • high percentage of technically competent professionals • highest growth rate of IT specialists in the region • strong language skills: English, French, German, Italian, Spanish, Russian, etc. • large skilled labor force at comparatively low wage rates Source: National Institute of Statistics

  9. Telecommunication infrastructure – coverage area -

  10. Inward FDI Performance • Record values in 2004-2006 • FDI Stock EUR 31 bill. (1990 –December 2006) • EUR 9.1 bill. in 2006 Inward FDI EUR billion Regional Comparison 2006, EUR million Vienna Institute of International Economic Studies

  11. FDI by Country and by Field of Activity- 2006 – Value of Subscribed Capital by Field of Activity National Trade Register Office

  12. Turkish Investment in Romania 1990 – 2006 Source: National Trade Register Office – Ministry of Justice

  13. Top 10 Turkish Companies in Romania Source: National Trade Register Office – Ministry of Justice

  14. Automotive Industry Opportunities • Experience in the field of car makers • Automotive component parts – rapidly growing sector: currently over 175 major manufacturers • Availability of labor force • Labor cost: monthly average salary approx. Euro 250; • Total number employed: 120.000; • Trained work force • 7 colleges in vehicle technology – 500 graduates each year; • 25 colleges in mechanical engineering – 1.000 graduates each year; • Availability of suppliers and subcontractors • Presence of R&D centers • Success investment stories in the field

  15. MAJOR FOREIGN INVESTMENT in automotive industry

  16. Romanian ITC Industry Trends • High density of Romanian IT specialists (five times higher than in Russia, and seven times than in India). • Romanian Olympic students are usually placed in top 4 with China, US and Russia. • In Microsoft the second spoken language is Romanian; • Low brain drain phenomenon in Romania; • IT sector is in constant growing; • Major multinational IT companies such as Microsoft, HP, Oracle, Cisco, Intel and Motorola are present in Romania - many of them use Romania as regional headquarters;

  17. A Top European Location for R&D and specialized BPO

  18. 700 employees focusing on CRM contact center, application development especially in structured content (eContent) 350 employees primarily in application development, maintenance and integration 570 employees focused primarily on outsourced technical support and outsourced manufacturing 200 engineers focused on application development and R&D. Romsys is a Lockheed Martin Star Supplier Founded by Cap Gemini execs, 150 engineers focused on application development primarily for the German and UK markets Development subsidiary for 2400 employee US-based Tech Team provides application development for the automotive sector Provides multilingual research services for Frost & Sullivan and other complex BPO for clients like Alfa Romeo and Fiat 200 employees provide technical documentation, drawing and parts inventories for Airbus and other aviation clients Strong outsourcing and technology players* *includes company with primary development locations in Romania. Multinationals like Ness and Wipro are excluded Source: Ministry of Communication and Information Technology

  19. WHO is A.R.I.S? • Established in July 2002; • Governmental body under the authority of Prime Minister • In charge with attracting and retaining foreign direct investment; • “One stop shop” for foreign investors; • Interface between investors and central & local authorities; • Providing “free of charge” services for new comers and existing investors in Romania;

  20. Long Term Visa for Commercial Activities ARIS ENDORSMENT - ARIS is granting an endorsement to the foreign citizens requesting the long term visa for developing commercial activities in Romania. NECESSARY DOCUMENTS FOR APPLICATION -availble on line at: www.arisinvest.ro VISA REQUEST – submitted to the Consulates of Romania - Documents: ARIS endorsement; criminal record certificate or other document with the same legal value; Medical insurance for the visa validity period. - 1st application – visa granted for 6 months; -visa extended for new intervals of up to 1 year – granted by the Authority for Aliens

  21. Review of Major Reasons to Invest Romania • Healthy and Predictable Investment Climate • EU member state from January 2007 • Supportive Operational Conditions • Favorable Economic Conditions • European Structural Funds available • Specialized authority in the field of direct investment

  22. Thank you for your attention! Tel: +40 21 233.91.03 Fax: +40 21 233.91.04 Email: aris@arisinvest.ro Website: www.arisinvest.ro

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