11/7/12 .com.ux4ll8xu6v. useaccesscontrol.com/pqcentral/pr intv iew f ile?a ccountid=1 5533 1/5 search.proq uest.com.ux4ll8xu6v .useaccesscontrol.com/pqcentral/prin tv iew f ile? accountid= 1553 3 Abstract (summary) Full Text Back to prev ious page document 1 of 1 ROMANIA: Developing market offers FDI opportunities Oxford Analytica Daily Brief Service. (Jan 05, 2007). Romania's leading position regionally for foreign direct investment (FDI). Romani a has eme rged in the past few ye ars as one of the most attracti ve destinati ons for FDI in Central-Eastern Europe. Institutional development linked to EU accession, a relatively well- qualified and cheap labour force, low taxation and huge untapped market potential are likely to remain the main advantages. SUBJECT: Romania's leading position regionally for foreign direct investment (FDI). SIGNIFICANCE: Romania has emerged in the past few years as one of the most attractive destinations for FDI in Central-Eastern Europe. Institutional development linked to EU accession, a relatively well-qualified and cheap labour force, low taxation and huge untapped marke t pot ential are likel y t o remain the mai n advant ages. ANALYSIS: Romani a's economi c fortun es look po sitive as it jo ins the EU. The economy expanded by 7.8% in the first nine months of 2006 and growth should continue a t a s imilar pace (see ROMANIA: Ec onom ic g rowth is likel y to cont inue - Ja nuary 18, 2006). However, despite decelerating inflation, gains in productivity and competitiveness, and respectable export growth in the past deca de, i mports have grown fast er, and the 2006 current acc ount deficit may exceed 9% of GDP. In 2006, most imports were due to capital investment and accompanied by record foreign direct investment (FDI) inflows. According to the National Forecast Commission, in the first ten months, the current account deficit of 7.8 billion euros (10.2 billion dollars) was covered by FDI inflows of about 7.9 billion euros. However, maintaining such high levels of FDI could prove a challenge for the government in the coming years, as privatisation draws to a close. FDI favourite According to UNCTAD, Ro ma ni a ranks 24th in the worl d fo r attractiv eness to foreign inve st ors and 1st in Central-Eastern Europe (CEE), capturing jus t o ver half of all funds directed there. Such high FDI inflows will be vital not only for the financial stability of the country, since current account deficits should remain high in the coming years, but also for its overall development. The business environment is generally positive, with low labour costs, geographical proximity to Western Europe, relatively low taxation (the corporate tax rate is 16%) and recently
