Key messages at the BRCC Conference in London: Why Romania sees records high FDI, overcoming Ukraine war fall-out?

The British Romanian Chamber of Commerce (BRCC), in partnership with the Embassy of Romania in London and RSM Romania, organized the conference “Why Romania sees records high FDI, overcoming Ukraine war fall-out?” part of a series of initiatives through which BRCC supports an open and constructive dialogue between decision-makers and the business environment in London.

The conference on October 4, 2023, brought together high level professionals from the business community and representatives of public sector in the UK. The event focused on Romania being a safe heaven for investors and businesses in the region, the EU’s gateway to Ukraine and the Ukraine’s gateway to the world alike.

Moreover, Romania is the second energy-independent country in the EU (28% energy imports compared to the EU average of 57%), having resources that include gas, off-shore wind, and solar to achieve energy independence.

The event has successfully provided a platform for professionals and businesses from both academia as well as industry to meet and share developments in the field.

In the opening of the conference, Bogdan Mihailescu -Minister Counsellor for Commercial and Economic Affairs at the Romanian Embassy in the United Kingdom, emphasized that ” Romania remains a preferred option in the region for FDI, even in the context of the war in Ukraine, attracting record investments in 2022. Among the main reasons are the solid economy, which has demonstrated its resistance to large adverse shocks, the intensity of grants for investors going up to 60% in less developed regions of the country or geographical position and the longest border with Ukraine among all EU countries. Finally, the extremely low degree of energy dependence, the second lowest in the EU, and the focus on investment projects in renewable energy, solar and wind.”

The Director Economics, Innovation and Technology, Cristian Niculescu-Marcu and the Managing Partner RSM Romania, Dan Schwartz addressed remarks during the conference, offering informed perspectives and responses to questions related to Romanian investment landscape in the current geopolitical context and Updates on the Double Taxation Treaty RO-UK – enhancing mutual investments.

The conference was moderated on behalf of BRCC by Bogdan Mihailescu -Minister Counsellor for Commercial and Economic Affairs at the Romanian Embassy in the United Kingdom.

Flavia Kenyon – Barrister, commercial and technology, The 36 Group chambers reiterated the importance of the Act on facilitating trade and the benefits of the international trade for businesses in the new context.

Concluding a comprehensive presentation of the Romanian tax system with advantages and disadvantages and how Romania cannot be considered a Tax heaven, Dan Schwartz – Managing Partner of RSM Romania emphasized that bilateral taxation is a key matter that influences investors’ decisions in both Romania and the UK. Although the Romanian tax system seems to be friendly enough to investors, an updated double taxation treaty could be crucial for the implementation of the strategic partnership that was agreed between Romania and the UK and for the development of the Romanian economy. A modern double taxation treaty will grant investors from both countries more predictability and stability and create the means necessary to the business community to protect its investments and assets.

In the presentation dedicated to the “Our eyes on Romanian M&A”, reviewed the main transactions for the first 9 months of 2023 and top sectors, emphasizing a positive outlook for Romanian M&A by growing affluent middle-class and EU funds and state aid availability.

“In the first nine months of 2023 Romania has once again proved to be the exception to the rule in terms of M&A activity, demonstrating the strong underlying fundamentals that continue to make the country an attractive investment destination for foreigners underpinned by a growing domestic investor base. Although the value of Romanian M&A declined by 20% to USD4.2bn in the nine months to 30 September 2023, this compares to a 28% decline globally and 40% decline in Eastern Europe. Given the comparative size of Romanian M&A in the global context, the number of deals is a better indicator of the health of the market than deal value. The 6% fall to 183 transactions in Romania shows a far more buoyant market than Eastern Europe which recorded a 14% decline. Despite some headwinds, the outlook remains positive for Romanian M&A.” Peter Latos-Partner Strategy and Transactions Leader, EY Romania.

During the discussions, BRCC also emphasized why Romania can be considered a tax heaven in Europe and pointed the main products and services offered to UK/Romanian companies to expand trade and support investment in Romania.

The BRCC conference once again confirmed the need and relevance of an open dialogue between the business community and regulatory institutions in support of sustainable economic development through a series of upcoming initiatives both in Romania and UK. The conference was made possible with the kind support of Embassy of Romania in London, RSM Romania and Repatriot to which we thank for their contribution.

BRCC will continue to bring together hot topic of high interest for the business community both in UK and Romania.