MINISTRY OF ECONOMY AND COMMERCE

1. MINISTRY OF ECONOMY AND COMMERCE ROMANIA Member of the European Union ECONOMIC DEVELOPMENTS AND OPPORTUNITIES IN ROMANIA by Varujan VOSGANIAN , Minister

2. Benefits of EU Accession • Removal of any obstacles in the trade with EU Member States • Common trade policy with third countries • Harmonization of entire legislation, capital market regulations, taxation, accounting rules => higher transparency and simplification • Structural funds(31 billion euro for 2007-2013) • Open gate for EU towards CIS, Asia, Middle East, Northern Africa • Participation in major projects in the Black Sea Extended Area and in the Central & Eastern European Region • Romania-important role in assuring the energy security for Europe (major transit pipelines, energy production & supply)

3. Competitive Taxation

4. Macroeconomic Performance GDP real growth

5. Macroeconomic Performance Inflation rate

6. Macroeconomic Performance Unemployment rate

7. COUNTRY RATINGS ROMANIA • Fitch - A- (August 2006) • Coface - A4 (January 2006) • JCR - BBB+ (November 2006) • Moody’ s - Baa3 (September 2006) • Standard & Poors - BBB-(September 2006) World Bank Report 2006: Romania – the most reforming country in the business field

8. Foreign direct investments- million Euro -

9. FOREIGN DIRECT INVESTMENT Total FDI’s until 31.12.2006: 31 billion euro 1. The Netherlands - 21,06% 2. Austria - 12,94% 3. France - 10,27% 4. Germany - 10,24% 5 . Italy - 5,56% 6. U.S.A. - 4,72% 7. United Kingdom - 4,43% 8. Netherlands Antilles – 3,65% 9. Greece – 3,61% Source:National Trade Register Office

10. DIRECT INVESTMENT WITH SIGNIFICANT IMPACT ON ROMANIAN ECONOMY, BY MAIN FIELDS, IN 2006 Source: Romanian Agency for Foreign Investment

11. Foreign Investor Advantages • foreign investment allowed in all sectors of economy • possibility to freely manage the company with full ownership rights • full repatriation of capital and profits • protection against expropriation and nationalization • national treatment for foreign investors

12. New Investment LawDraft under public debate Objectives: • Determines the principles, terms and modalities of stimulating investments in Romania, aiming at contributing to the sustainable country development • Full compliance with the EU legislation • The Government will issue also legal/administrative acts in order to regulate the state aids schemes for each objective • The goals, objectives, timing, budgets, beneficiaries, eligibility and selection criteria, competent authorities responsible to grant incentives will be established • A responsible authority for implementing and monitoring the legal provisions will be set up

13. FOREIGN TRADE, IN THE PERIOD 2001 – 2006 Source: National Institute of Statistics (www.insse.ro)

14. GEOGRAPHICAL ORIENTATION OF THE ROMANIAN EXPORTS, IN 2006 Source: National Institute of Statistics (www.insse.ro)

15. GEOGRAPHICAL ORIENTATION OF THE ROMANIAN IMPORTS, IN 2006 Source: National Institute of Statistics (www.insse.ro)

16. TRADE BETWEEN ROMANIA AND AUSTRIA, IN THE PERIOD 1999 – 2006

17. Romanian Exports Machinery and electrical equipment – 42,5 % Furniture, toys and other – 10,8 % Textile and garments - 8,9 % Metals and articles thereof – 7,9 % Transport equipment - 7,6% Romanian Imports Machinery and electrical equipment – 35,1 % Plastics and rubber – 14,9 % Metals and articles thereof – 9,5 % Transport equipment - 7,3 % Chemical products – 5,3 % STRUCTURE OF THE BILATERAL COMMERCE, BY MAIN GROUPS OF PRODUCTS, IN 2006

18. Austrian FDI’s in Romania • Austria – ranking 2ndamong the foreign investors in Romania – 2 billion euro share-capital in Romanian companies / 7 billion euro effective investments, according to Austrian sources • 4192companies with Austrian capital registered in Romania • Main sectors for Austrian investments:banking, petrochemical industry, wood procesing, food industry

19. TOP REASONS TO INVEST IN ROMANIA (1) • Market & Location Advantage : • Second largest market in Central and Eastern Europe (over 21 million inhabitants)                     • Easy access to the countries of the former CIS countries, Balkans, the Middle East and Northern Africa • Junction of three prospective European transportation corridors nos. 4, 7 & 9 • Resource Advantage: • Skilled labor force, with solid knowledge in technology, IT and engineering • Rich natural resources, including fertile agricultural land, oil and gas • Important potential for tourism

20. TOP REASONS TO INVEST IN ROMANIA (2) • Economic Advantage • Sustainable economic growth • Functional Market Economy status • Competitive tax policy • Decreasing inflation • Permanent financial assistance for SME's Development • Structural funds • Improving Infrastructure Advantage • Well-developed networks of mobile telecommunications in GSM systems • Highly developed industrial infrastructure, including oil and petrochemicals • Branch offices and representatives of various well-known international banks • Newly developed highway infrastructure • Commitment to improve the highway infrastructure to EU standards • Extensive maritime and river navigation facilities

21. Manufacturing Automotive parts IT & Communication Electric & Electronics Wood processing Construction materials Textile Food processing Infrastructure Outsourcing and logistics Potential Sectors for Investment

22. THANK YOU ! • MINISTER OF ECONOMY AND COMMERCE • ROMANIA • Phone: +40 21 202 51 40 • Fax: +40 21 202 51 77 • E-mail: varujan_vosganian@minind.ro • Website: www.minind.ro