Increase well-being by supporting and encouraging businesses and other economic agents to create jobs and invest in high value added goods and services.
The current situation:
- Top 10% of Romanian firms hold almost 91% of total business revenues – much lower for Hungary (72%), Poland (68%) or Czech Republic (59%);
- 99% of Romanian companies are SMEs, but they have a poor health, barely being able to breath;
- Only 1% of domestic companies have revenues higher than 5 million EUR, which represents nearly 65% of the total business revenues in 2008, reaching 74% in 2015
- For each exporter, there are 4 importers (22,000 exporters – 5% of all active companies – to 80,000 importers);
- Turnover of the 1155 state-owned companies – RON 44.5 billion (4% of total economy)
- Cumulative balances – 20.7% of the total arrears in the economy (3.7% of Romania’s GDP in 2014)
- Number of employees: 300 thousand people (7.6% of the total number of employees in Romania)
1. Sustainable economic growth:
- Reindustrialization – Romania has an industrial base that needs to be constantly improved in order for it to be on the winning side of global competition. We need to use the competitive advantages of different sectors to reposition Romania as an essential actor on the European and global value chain
- Economic clusters – supporting all available instruments (including direct investment, public-private partnerships, taxation, attracting foreign investment, but especially obtaining and disseminating information on industries and profitable activities), strengthening clusters around businesses, existing research centers, the growth of new and high added value industries (such as medical devices and nanotechnology in Bucharest, big data and biotechnology in Iasi, semiconductors in Cluj, and so on).
- State-owned enterprises – over the past 26 years, many state-owned enterprises have served as a financing tool for a corrupt political class. At the same time, most employees saw lower wages, restructuring and worse working conditions. Corporate governance needs to be improved so that businesses can increase their competitiveness and secure their place in the European and global value chain.
- Entrepreneurship: funding schemes need to be significantly simplified and promoted so that SMEs can access these schemes efficiently, electronically, with minimal effort. The administrative process must be substantially reduced so that SMEs can concentrate on their core business rather than on completing redundant forms with little or no added value. An essential component of this process is digitization and transition to online processes.
2. Increasing labor force participation:
- Continuous job creation – by supporting investment, entrepreneurship and innovation, we can ensure employment growth. Once competition takes root and thus productivity increases, we will see wages rise and, implicitly, well-being across the country.
- Women’s participation: Women’s participation in the labor force in Romania is 57%. In order to encourage women’s participation, reforms are needed to create a framework that would allow/enable women to combine family and professional life. Society must share the responsibility of raising children through programs that allow parents to reintegrate into their workforce effectively after maternity / paternity leave.
3. Reducing regional economic disparities
Regional development policy requires the use of local resources, as well as of those extracted from the national or international environment in order to increase the adaptability of the production and functionality components to the needs of structural adjustment and, last but not least, to reduce regional divergences. The more developing regions develop in a more balanced way, the more beneficial it is at a macroeconomic level, as Romania would no longer be exposed to certain poles of economic development, in different economic sectors. A good example is reducing regional disparities in terms of unemployment, or even production. A factor that has a significant impact on them is the encouragement of labor flexibility, an action that would stimulate people to migrate to other regions, thus solving problems related to unemployment and underproduction.
Together we can make a difference and build the country we all want, so I’m waiting for your suggestions on the issue of “Economics”.
Also, don’t forget that great things are not made by a single individual! Send any questions or comments you may have.