AmCham Romania Business Barometer | Annual Survey on the Quality of the Investment Climate in Romania, 6th Edition
The overall investment climate is rated positive by 46% of respondents; plans to expand operations and investment in 2024 reflect confidence in Romania’s potential.
- Companies report revenue growth in 2023, and a majority (58%) anticipate further growth in 2024.
- For the first time in recent years, labor market tension has eased slightly. 88% of respondents, compared to 94% last year, indicated difficulty finding specialists in their sectors.
- Fiscal policy and taxation are once again among the top concerns for companies.
AmCham Romania presented the results of the annual survey on the quality of the investment and business climate. The 6th edition highlights the optimism of AmCham members and their confidence in Romania’s economic potential, confirmed by consistent investment intentions over the next 12 months and expansion plans for the next three years.
Regarding the overall investment climate, 46% of participating companies rated it as good or very good, similar to the optimistic post-pandemic level of 2021 and significantly higher than 2019 (36%), although slightly down from 51% in 2023.
This positive outlook is supported by business results that match the estimated levels for revenues (63%) and investments (51%). For 2024, companies anticipate similar performances, with slight decreases in growth across all three areas, including the number of employees.
“Romania is the best investment destination in the region. This is the message AmCham consistently conveys to potential investors, relying on the optimism of our members, their positive business results, and their ongoing investment plans. Romania’s EU and NATO membership and the prospect of OECD accession remain key confidence anchors, while the most compelling business and investment advantages are human capital, market size, digital infrastructure quality, and, very importantly, the fiscal framework. This is significant because taxation levels and the fiscal framework not only attract investments but are essential for growth and for generating prosperity. Given last year’s fiscal measures, which at the end of the day did not reduce the budget deficit, the fiscal system is once again a major concern for the private sector. In this context, we reiterate AmCham Romania’s support for maintaining the flat tax, which remains most adequate for Romania’s economy current development and complexity,” stated Cristian Sporiș, President of AmCham Romania.
Regarding the most appreciated market conditions, digital infrastructure quality holds the top position for the sixth consecutive year, with 60%, followed by the quality of human capital, which has increased in importance and percentage compared to previous editions. The quality of cybersecurity infrastructure and digital competencies of the active population are also highly valued, close to the top two conditions.
In contrast, the least appreciated market conditions, ranked “poor & bad” by participating companies, are consistent. With 78%, transport infrastructure quality continues to surpass debureaucratization, which remains second least appreciated, with 72%, followed by healthcare infrastructure quality (70%). Over half of respondents rate the predictability of the investment framework and economic and industrial policy as poor & bad.
“We emphasize that the list of economic measures and priority public policies resulting from this survey, reflects the need for interventions to improve those market conditions that still hinder the development of businesses and of the economy at large. Along with investments in critical infrastructures, maintaining a competitive fiscal system, reducing labor taxation, and digitizing public services, AmCham members consider the high absorption and use of European funding crucial for 2024. These funds are still available at record levels, but Romania will not benefit from them much longer once it reaches a certain convergence threshold with the European Union. For the first time included as an option in this year’s edition, more than half of respondents indicated a significant need to improve the quality of the education system. For years, the business environment has called for the reform of the education system and its alignment with the needs and evolution of the economy, while actively contributing to this change, including through substantial CSR investments. The quantity and quality of graduates at all educational levels have a direct socio-economic impact. Education is one of the structural causes of the current labor force deficit, but there are several solutions for education to become a real growth vector and add value at individual, community, and societal levels,” stated Daniela Nemoianu, Vice-President of AmCham Romania.
For the first time in recent years, the AmCham survey reflects a slight easing of labor market tension. The percentage of those who consider the labor market tense, meaning they face difficulties finding qualified employees and rising costs, decreased from 94% to 88%.
“This relaxation is mainly due to industry restructuring and automation investments rather than measures addressing structural causes. Companies still face difficulties finding qualified employees while experiencing increasing budget pressures. Our call for interventions to address the deficit remains strong to prevent labor market tension from becoming a macroeconomic risk. Companies are already allocating significant resources to overcome challenges related to the local economy, such as rising tax burdens, inflation, increasing fixed costs, deepening budget deficits, and high debt levels, as well as challenges arsing from global trends impacting businesses, like AI, military conflicts, or complying with ambitious sustainability goals,” stated Dinu Bumbăcea, Vice-President of AmCham Romania.
As for the mix of business financing source, 91% of companies, up from 86% last year, rely on own funds, followed by shareholder loans mentioned by 69% of respondents, also slightly more than in 2023. European funds are an option for 28% of respondents, a significantly lower percentage than in the previous edition. Other financing sources, such as capital markets and private equity, are used by less than 10% of respondents, while state aid, included in the survey for the first time, was indicated by 11% of companies. Only 17% anticipate a decrease in financing costs, 38% expect increases, and 45% believe they will incur financing costs at the same level as in 2023.
Companies’ investment intentions in Romania remain positive: 72% of companies have planned investments in 2024.
The consolidation of companies in Romania also enables them to expand to other markets through external investments and exports. Nearly half of the companies participating in the survey have taken this step – 9% of all participants have both exports and investments, 9% have only investments, and another 26% have both.
Regarding the fiscal-budgetary measures adopted last year, the AmCham survey included an assessment of the impact of the 1% turnover tax. Thus, 39% of the over 100 companies potentially affected by the measure, given that it applies only to companies with a turnover exceeding EUR 50 million, indicated a significant or very significant impact.
“The minimum turnover tax, which we initially considered unjust and competition distorting, both in terms of its adoption and impact, affects Romania’s fiscal competitiveness and creates an unfriendly business environment. To mitigate some of the effects, especially among large taxpayers, AmCham requests the correction of the calculation formula to exclude research and development expenses, the cost of any taxes, contributions, excise duties, or sectoral taxes, exchange rate differences, and foreign tax credits, among others. These adjustments are essential to avoid double taxation and ensure a fair assessment of companies’ economic performance, thus protecting the competitiveness and coherence of Romania’s fiscal framework,” stated Vlad Boeriu, Member of the Board of Directors of AmCham Romania.
“Overall, AmCham members are sending a positive signal, choosing to invest and grow in Romania, and it is a legitimate expectation on our side that the government also responds to this confidence with stable and transparent fiscal policies,” concluded Cristian Sporiș, AmCham Romania President.
In the context of an election year, with new measures expected to impact the economy, AmCham will seek to bring the vision, priorities, and concerns of our business community into dialogue with decision-makers, providing recommendations aimed at strengthening Romania’s investment profile in the region.
About the 2024 AmCham Business Barometer Survey
- Participants:
- 235 out of 570 AmCham Romania member companies, at the CEO or CFO level.
- 46% – large taxpayers
- 32% – medium taxpayers
- 22% – small taxpayers
- Survey period:
- April 15 – May 31, 2024
conquered. This remote hamlet is a breathtaking marvel of nature and human endurance, where life hangs literally on the edge—cliffside homes clinging to slopes that make strong men dizzy and old women chuckle at lowlanders’ trepidation.
Henri Marie Coandă (Romanian pronunciation: [ɑ̃ˈri ˈko̯andə] (7 June 1886 – 25 November 1972) was a Romanian inventor, aerodynamics pioneer, and builder of an experimental aircraft, the Coandă-1910, which never flew. He invented a great number of devices, designed a “flying saucer” and discovered the Coandă effect of fluid dynamics.
and Năvodari on the Black Sea. Administered from Agigea, it is an important part of the waterway link between the North Sea and the Black Sea via the Rhine–Main–Danube Canal. The main branch of the canal, with a length of 64.4 km (40.0 mi), which connects the Port of Cernavodă with the Port of Constanța, was built in 1976–1984, while the northern branch, known as the Poarta Albă–Midia Năvodari Canal, with a length of 31.2 km (19.4 mi), connecting Poarta Albă and the Port of Midia, was built between 1983 and 1987.
Although the idea of building a navigable canal between the Danube and the Black Sea is old, the first concrete attempt was made between 1949 and 1953, when the communist authorities of the time used this opportunity to eliminate political opponents, so the canal became notorious as the site of labor camps, when at any given time, between 5,000 and 20,000 detainees, mostly political prisoners, worked on its excavation. The total number of prisoners used as labor force during this period is unknown, with the total number of deaths being estimated at several tens of thousands. The construction works of the Danube–Black Sea Canal were to be resumed 20 years later, in different conditions.
George Emil Palade (Fellowship of the Royal Society, Royal Microscopical Society) (Romanian pronunciation: [ˈdʒe̯ordʒe eˈmil paˈlade]; November 19, 1912 – October 7, 2008) was a Romanian-American cell biologist.
born American writer, professor, political activist, Nobel laureate, and Holocaust survivor. He authored 57 books, written mostly in French and English, including Night, a work based on his experiences as a Jewish prisoner in the Auschwitz and Buchenwald concentration camps.
Herta Müller (born 17 August 1953) is a Romanian-born German novelist, poet and essayist noted for her works depicting the harsh conditions of life in Communist Romania under the repressive Nicolae Ceauşescu regime, the history of the Germans in the Banat (and more broadly, Transylvania), and the persecution of Romanian ethnic Germans by Stalinist Soviet occupying forces in Romania. Müller has been an internationally well-known author since the early 1990s, and her works have been translated into more than 20 languages. She has received over 20 awards, including the 1998 International IMPAC Dublin Literary Award. On 8 October 2009, it was announced she would be awarded the 2009 Nobel Prize in Literature.
Sciences in Göttingen, and of the Max Planck Institute for Medical Research in Heidelberg, both of which are in Germany. He received the Nobel Prize in Chemistry in 2014 “for the development of super-resolved fluorescence microscopy”, together with Eric Betzig and William Moerner.
