A marketplace of 22 million, 37 million acres of arable land, a vibrant oil and gas industry, breathtaking landscapes, an expanding economy, a well-educated workforce with more than 50,000 specialists in information technology, access to the Black Sea and Asia. These features of Romania have attracted U.S. investors in banking, energy, biotechnology, manufacturing, electronic components, cable operation, consumer products, telecommunications and film production, among others. They have discovered that American management and capital works profitably in Romania. U.S. exports in Romanian are growing as well, fueled by Romania’s economic expansion and new reductions in trade barriers.
Romanian Country Commercial Guide
The Country Commercial Guide (CCG) presents a comprehensive look at Romania's commercial environment using economic, political, and market analysis. The CCGs were established by recommendation of the Trade Promotion Coordinating Committee (TPCC), a multi agency task force, to consolidate various reporting documents prepared for the U.S. business community. Country Commercial Guides are prepared annually at American Embassies through the combined efforts of several U.S. government agencies.
FROM THE ECONOMIST INTELLIGENCE UNIT
Background: Romania fell under communist control at the end of
1947. The communist leader, Gheorghe Gheorghiu-Dej, embraced
Stalinism, but gradually proceeded to loosen Romanian ties with
the Soviet Union. The split widened under Nicolae Ceausescu, who
took over as party general secretary in 1965. The grip of the
Ceausescu clan on the economy and polity ended in a coup in
December 1989. Parliamentary and presidential elections were held
in May 1990. A new constitution was adopted in 1991, and this was
revised in 2003.
Political structure: Romania operates a bicameral parliamentary
system. The Senate (the upper house) has 137 seats and the
Chamber of Deputies (the lower house) has 332. From 2008 both
chambers are directly elected for a four-year term from 41
single-member constituencies, comprising 40 counties and the
municipality of the capital, Bucharest. The head of state is the
president, currently Traian Basescu, who serves a five-year term.
Following the general election on November 30th 2008, the
Democratic Liberal Party (DLP) and the Social Democratic Party
(SDP), together with the SDP's smaller partner, the Conservative
Party (CP), formed a coalition government, with 70%
representation in parliament. The former ruling National Liberal
Party (NLP) and the Hungarian Democratic Union in Romania (HDUR)
make up the parliamentary opposition.
Policy issues: Gradualism was the hallmark of reform in Romania
in the 1990s. Macroeconomic stabilisation programmes were
undermined by a failure to undertake structural reforms, and
periods of growth were superseded by bouts of high inflation and
macroeconomic imbalance. Important structural reforms in the
early part of the current decade helped to stabilise the economy,
but lax fiscal and incomes policies in recent years led to
overheating in 2007-08, as well as to rising external
imbalances.
Taxation: In line with the regional trend towards the
introduction of lower tax rates and flat-tax regimes, Romania
introduced a flat tax of 16% for both personal income and
corporate profits in January 2005. Since 2000 there has been a
uniform rate of 19% for value-added tax (VAT). The authorities
are resisting pressure to raise the VAT rate to compensate for
low revenue intake. Social security contributions are high,
despite a series of reductions in recent years, and total 49.5%
of gross wages.
Foreign trade: In 2008 merchandise exports totalled US$49.4bn and
merchandise imports totalled US$76.2bn; the current-account
deficit was US$24.8bn, equal to 12.4% of estimated GDP. Around
68% of exports went to the EU27 in 2008.
(Source: The Economist - Country ViewsWire Romania)
Romania Country Commercial Guide 2009