Bogdan Drăgoi: Romania is attractive for investors

• The Ministry of Finance Official says: "Investors are waiting for Romanians to access the European market"

• Florin Cîţu: "The number of investors is small"

Romania is attractive for investors, and some of its benefits include the speed at which it has passed anti-crisis measures, says Bogdan Drăgoi, secretary of state in the Ministry of Public Finance.

"Romania is one of the countries which was the fastest to implement reforms", Drăgoi said yesterday at a conference at the NBR. He said that Romania has already issued two successful Eurobonds issues, on the foreign markets, and that the MTN (ed. note: medium term notes) program is being "upgraded" for the American market. "Investors are waiting for Romania to access the American market", Bogdan Drăgoi said.

The government recently approved a program for an issuance of MTNs on the international market with a 3-year maturity and a maximum amount of 7 billion Euros. In the first issuance of the program, the Ministry of Finance raised 1.5 billion Euros in the beginning of July, by selling 5-year bonds with a coupon of 5.29%.

Still, the secretary of state concedes that investor appetite for buying the "product" called Romania has changed: "Investors have become a bit more selective".

A bit more cautious, economist Florin Cîţu considers that the number of investors interested in Romania is low.

"There are a few investors with a perception like this (ed. note: that Romania is attractive for investors), but they are very few", said Florin Cîţu, and he added: "Interest is low because of the problems that investors have at home, and because of the unpredictability of the Romanian tax regime".

If issuing bonds on the foreign markets happens less frequently, once every five years, for instance, it"s alright. The problems appears when they are done repeatedly".

According to Bogan Drăgoi, Romania has a two-three year head start in implementing some reforms, which have already begun producing positive effects, such as lowering deficits, budget optimization, the law of wages, the law of public finances, and the law of education: "The main objective of these measures was to reduce spending and to create more room for investment".

Furthermore, the two programs concluded with the international financial institutions, (the IMF, the European Commission and the World Bank) represent an anchor of credibility before investors, and serve to convince them that the measures which were enacted are the right ones, Drăgoi said.

• "European money must come to Romania"

The government is looking to implement projects that will have a multiplier effect, the official of the Ministry of Public Finance said, and he mentioned the implementation of the European projects and private public partnerships.

"The contracts (ed. note: for attracting European funds) for projects have been signed; they must be implemented by 2015, and have the money come to Romania".

Dragoi reminded that Romania has access to 38 billion Euros in EU structural funds.

Concerning the implementation of the public-private partnerships (PPP), he said that the ministries have identified a series of 18 large scale projects which were designed to be attractive to the private partners. The law concerning the public-private partnerships is currently in Brussels, Drăgoi said.

According to him, the Ministry of Finance has attracted investments of 1.3 billion Euros in 2010-2011, projects which created 7,000 jobs.

"Even if Nokia left, in 2010-2011 22 new investments (ed. note: the expansion of Dacia, Pirelli, Premium Aerotech, Continental, Delphi) were made in Romania", Drăgoi added.

Between January and July 2011, direct investments of non-residents in Romania amounted to 1,105 million Euros, down 30.5% over the similar period of 2010.