Romania/December 2015
During recent years, Romania has achieved significant macroeconomic development, further sustained by programs and arrangements with the IMF, European Union and the World Bank.
Per IMF’s reports following the visit in October 2015, the key priorities should focus on solidifying public finances, the continuation of structural reforms and the maintenance of a high level of confidence in sustainable measures.
In the course of 2015, the European Commission made country-specific recommendations for the improvement of economic performance. These are related to the implementation of the program; public finances, taxation and pensions; the labour market, wage-setting, education and health, as well as state-owned enterprises.
Romania is one of the European countries with a highest growth rate in 2015, forecast at 3.5%. According to the National Statistics Institute (INS), between January and September 2015 Romania’s economy went up by 3.7%. For the first half of 2015 the trend is comparable to 2014 when the growth rate was 3.8. The solid growth of 2015 is expected to be continued in 2016.
Industries and the development of effective transportation require an efficient infrastructure. Based on the Transport Master Plan 2015-2030, Romania will need to receive investments in amount of around EUR 50 billion in order to improve the transport infrastructure.
The agriculture sector continues to offer solid opportunities for investment as well, taking into consideration the potential area to be cultivated, albeit with lower expected return on investment. Romania could explore more its growth potential as a grain producer and open up to the Asian and Middle East markets.
The information technology sector is predicted to continue with a high rate of growth as Romania offers a highly skilled, creative and competitive workforce and as such is leader in the field.
One of challenges for Romania is to prepare a realistic budget for 2016 complying with the EU fiscal targets. Starting from 2016, the VAT rate will be decreased from 24% to 20%. Additionally, the tax on dividends will be decreased from 16% to 5 %, while also including the incomes from dividends in the taxable incomes subject to a health contribution of 5.5%. The fiscal deficit must be monitored and controlled in 2016 as well.
2016 will be a landmark year for Romania as it embarks on the road of applying the strategy for smart, sustainable and inclusive growth Europe 2020. We look forward with confidence in Romania’s capability to attract new investors, safeguard its achievements in economic performance and improve the standard of living for its citizens.
Iulia Lascau,
Eurofast Bucharest
T. +40 213182262E. iulia.lascau@eurofast.eu