The stock of foreign direct investment (FDI) in Romania rose by EUR 5.5 billion during the last year up to EUR 83.8 billion, while investment of local investors abroad remains at a modest level.
Official data show foreign investors made total direct investment of EUR 83.8 billion Romania until the end of June 2019, an all-time high, up 7 percent (EUR 5.5 billion) against June 2018.
At the end of 2017, the main countries of origin of FDI in Romania were the Netherlands (25.9 percent), Germany (12.8 percent), Austria (12.6 percent), Italy (6.2 percent), and France (6.2 percent), according to the central bank.
In the same time, Romanian investors made total direct investment of EUR 654.7 million in other countries until the end of June 2019, down 4 percent compared to June 2018, National Bank of Romania (BNR) data show. Romania remains the smaller international investor in Europe.
Romania is a very small investor abroad even compared with its neighbors, as local investors prefer to focus on the local market or don’t have enough capital to expand abroad.
According to “World Investment Report 2019” released by United Nations Conference on Trade and Development (UNCTAD), Romania’s FDI outward stock amounted USD 745 million in December 2018, the lowest value among the 28 EU member states, far below the Czech Republic (USD 34.8 billion), Hungary (USD 29 billion), Poland (USD 28.5 billion), Estonia (USD 8 billion), Slovenia (USD 6.7 billion), Croatia (USD 6.6 billion) or Bulgaria (USD 2.7 billion).
The outward FDI stock is the value of the resident investors’ equity in and net loans to enterprises in foreign economies, according to the Organization of Economic Cooperation and Development (OECD), which sets the international standard of FDI.
Foreign direct investment is an investment in a business by an investor from another country for which the foreign investor has control – owning 10 percent or more of the business – over the company purchased.