Romania at the point of lift-off

8Apr/10

In Bucharest for most of last week, visiting Chelgate’s office there. We’re in new offices - our third move in the past five years, and they are a delight. Comfortable, elegant and close to almost everything that matters.

People are often surprised when I say Bucharest is one of my favourite cities. But perhaps the charm of the place is that you have to dig a little to find its beauty and its secrets. But, one early evening, sitting in the sun in the wonderful, restored old town, sipping a glass of cold Ursus beer, I realised that all the people around me were Romanians, enjoying the rediscovered charms of their city. The tourists will come. There is too much beauty and too much fun in the city for them to stay away much longer. And they’ll spread across the country, to the ski resorts or the lakes, then swarming through the unspoiled, astonishing beauty of exquisite ancient towns like Sibiu and Brasov. But they are not there yet, and this is the time to enjoy this extraordinary country.

Perhaps the biggest change since we first opened an office some five years ago has been in the use of English. Back then, fluent English speakers were very, very rare. Now it seems to be easier to find an English speaker in a bar, shop or restaurant in Bucharest than it would be in Paris. (Not, of course, that this is saying a great deal!). And business meetings seldom need an interpreter any more. The nightlife, too, has seen a transformation. Six years ago, the best restaurant in town was a grim, post-Ceauşescu hotel dining room, with a sad faced waiter wearing a soup stained shirt. Today, you can discover wonderful restaurants all over town, tucked away in back streets, nestling in cobbled squares, often giving new life to one of the crumbling and ornate old mansions that are so much part of the charm of Bucharest. On all sides, too, elegant bars and clubs are opening up, filled with live music and cheerful customers. We had an almost perfect evening at the Arts Jazz Club, tucked away behind the Senate House, listening to legendary American bassist Ari Roland and his quartet. In June Eric Clapton and Steve Winwood hit town. Ceauşescu really is very, very dead.

But as this new member of the European Union begins to look to the world around it, there is a recognition that not all is right with the country’s international image. Here is a country with a bright, highly educated, hard working population, where wage costs are low, and the workforce is committed and hungry to succeed. And membership of the European Union has made available billions of euros in structural funds, helping move Romania into the 21st century. Yet international investors are not (yet) beating a path to the Romanian door. Everyone knows, and everyone will tell you, Romania has an image problem.

For a couple of years now a heated debate has been raging in the PR world of Romania about the “re-branding” of the country. But the truth is that Romania isn’t ready for rebranding yet. First, before you even think about brand, you need to think about the product. And as yet, the product isn’t right. The problem of corruption is not just an image problem. It remains a sour reality, contaminating huge areas of commercial life. And that fact frightens away investors and partners who should be eagerly pouring into Romania by now. Government bureaucracy, too, remains a real obstacle. While the private sector has been moving ahead vigorously, improving its skills, sharpening its competitiveness, all too many government departments seem stuck in the last century, or earlier: inefficient, lethargic, under-skilled and under-qualified, sometimes corrupt, often dishonest. The good news , though, is that this is changing. A growing number of ministries and departments are seeing a real transformation, led by bright, well-qualified professionals with genuine integrity and a real vision of where their country needs to be heading. And the national leadership recognises the problem, too. Gradually, the corrupt, the inefficient and the ineffectual are being squeezed out of the system. Romania is very nearly ready for “lift-off”.

For Chelgate in Romania this is an exciting and rewarding time. More and more international businesses are exploring the opportunities offered by this new market. And they realise that they’ll need PR help from the outset. Not just in media relations. Not just in planning events and promotions. But also community and cultural relations. And perhaps above all, in Government Relations, at all levels, where they need to be very sure about the integrity and professionalism of the service they are employing.

But, for myself, I simply can’t wait to be back in the Arts Jazz Club, clutching my ice cold Ursus beer.

Terence Fane-Saunders

5 Responses to “Romania at the point of lift-off”

  1. As someone who has been to Romania frequently over the past 20-odd years, the transformation of the place is staggering. The people are friendly and generally have a work ethic which is on a par with Asians (except, as the blog says, the public sector). The country suffers from two key problems: red tape and corruption. Both need to be sorted out if Romania is going to move forward, but I do sense that there is a movement towards addressing both issues with many local authorities and public agencies, including the police, the subject of performance requirements. We will see what progress is made.

  2. I would agree with Terence, Romania is a country of undiscovered beauty, especially in the Transylvanian foothills. Having visited the area on numerous occasions, I am never disappointed with what I find - real forests, quiet valleys and unspoilt hills dotted with quaint “kabanas”.

    I have a number of friends who have experienced the planning and legal systems, and they would certainly agree that bureaucracy is a major problem. That said, corruption is declining with people thinking twice before offering a gift to expedite matters as these are more likley to be very counter-productive. The system is more now who you know not what you can give.

  3. Ruxandra Hacerian says:

    As a Romanian citizen, it is always interesting for me to see my country through the eyes of a foreigner.

    In my opinion, corruption is not about Romania, but about the process Romania is going through, with an immature political class and legislation far from what it should be. Unfortunately, this process is taking longer than anyone expected.

    About where Romania is right now in this process, Terence said it all: we had Ari Roland and Eric Clapton. Now, we are waiting to see U2 :).

  4. Ancuta says:

    Quote: “Yet international investors are not (yet) beating a path to the Romanian door. ”

    That is not true, Romania is the second most popular destination for FDI in Central and south eastern Europe. Romania has had a high influx of Foreign Direct Investment (FDI) since the 2000s. Before the economic crisis Romania had almost broke the 10 billion Euro mark for Foreign Investment. We are a popular foreign investment destination now that we are an EU Member State since 2007 (three years that equates too when taking 2010 as the third year). We had the highest growth in the EU before the economic crisis. After the economic crisis has vanquished for good then we are expected to have economic growth close to 4% according to 2011 IMF Estimates.

  5. Terence Fane-Saunders says:

    Well, Ancuta, I certainly don’t want to be negative about Romania. Chelgate are there because we believe that it is a country with tremendous potential. But I think it’s important to be honest and realistic about the situation, too.

    The fact is, that the latest figures from the WIIW (Vienna Institute for International Economic Studies) shows that Direct Foreign Investment into Romania was just over 4.5 billion euros in 2009. This is even lower than 2004 and 2005. And their forecast for 2010 is a gloomy 3.5 billion. For two or three years, up to 2008 there was certainly a healthy increase in DFI, peaking at just over nine billion. But this wasn’t sustained.

    But even during the years of that mini boom, the levels of Direct Foreign Investment were only a fraction of what - I hope and firmly believe - the Romanian economy will eventually generate.

    Looking at what you have written, I’d say that your viewpoint is not perhaps entirely impartial. But I think it does Romania no favours to pretend that the situation is better than it is. The reality is that Romania remains a country of massive and exciting potential. But for now, international investors remain hesitant. It’s really important that Romania defines , clarifies and promotes its economic “offer” to the world with all the skill and professionalism it can muster. If it does so, then I think it will see a strong and sustained inflow of international investment, for years and decades to come. But for now, international investors are not beating a path to the Romanian door. Recognising that reality is the first vital step in making that change.
    Terence

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