Romania slowly regains interest of greenfield investors after 2008-2009 crisis

The value of the greenfield investments in Romania announced by companies in 2018 was 10% higher than that in the previous year, namely USD 6.4 billion. This was 60% more than two years earlier, in 2016, according to an investment report compiled by the United Nations Conference on Trade and Development (UNCTAD), local Ziarul Financiar reported.

In this context, the local market is the second most attractive in the region, surpassing those of the Czech Republic, Hungary, and Bulgaria. In this ranking, the first place is taken by Poland, which last year announced greenfield investments with a cumulative volume of USD 18.4 bln.

UNCTAD also reports the ratio between the greenfield investments post-crisis in 2016-2018 compared to the period 2005-2007 before the crisis. In 2005-2007, with an annual average of USD 16.7 bln, Romania was a leader in the region, ahead of Poland, thus being the main market for greenfield projects in Central and Eastern Europe.

However, the boom period was followed by the crisis, which affected all regional markets, and the recovery years did not restore the value of greenfield investments to pre-crisis levels. The value of the projects from scratch announced in Romania in 2018 is less than 40% compared to the maximum annual level reached in 2005-2007.

For comparison, In Poland, the same report shows that 2018 the greenfield investments were 116% compared to the pre-crisis years, according to ZF calculations. Both Hungary and the Czech Republic have recovered much quicker compared to Romania as well.

In terms of foreign direct investment (FDI), Romania had a stock of USD 94 bln last year, up from USD 90 bln in 2017.

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