Investments prospects in Romania looked “much brighter than at present” a few months ago before this summer’s political events, writes FT. ‘Political squabbling has meant that a program of reforms agreed with the International Monetary Fund, including a series of privatizations, has stalled,” according to the source.
The privatizations’ program is seen as critical to broadening choice on the stock market and improving liquidity.
For the moment, foreign interest in Romania as an investment destination remains low.
“The country is not so much in the wrong place at the wrong time as in all the wrong places. It is classified as a frontier rather than an emerging market, and so it misses mainstream emerging market investment. However, within the frontier markets universe, it is, currently, seen as one of the less compelling options,” writes FT.
According to the same source, the hope now is that a general election on December 9 will deliver a clear result and the privatization will be resumed. “Not only will this mean that important economic sectors, such as utilities, will be represented on the stock market, it may also encourage private listings,” according to FT.
Simona Bazavan