#countryfocus | Brexit unlikely to deter British companies from investing in Romania

Real estate, the food and drink industry and retail are three of the sectors most likely to see new investments this year, including from British companies.

 Simona Bazavan

With Brexit negotiations scheduled to start this June, an important question is how this will affect British investments in the local economy.  “The question everyone would like an answer to, but without a crystal ball it is difficult to estimate what impact positively or negatively the current negotiations will have. What we can say is, from discussions we have had with British businesses and investors, it is very much business as usual and possibly, if anything, there’s an increased interest in Romania as a trading and investment partner,” Charlie Crocker, CEO of the British Romanian Chamber of Commerce (BRCC), tells BR.

Some of the most significant investments made by British investors locally over the past year have been in pharma, energy, constructions and IT. In the food and drink sector, wine producer Halewood invested over EUR 10 million and has now grown to operate five subsidiaries in Romania, says Crocker.  “Also noteworthy is real estate developer Tagor, owned by British fund Patron Capital. The developer owns many residential projects in Bucharest, Timisoara and Arad. In 2016, the company sold 120 apartments in all its residential projects and this year, it continues the construction work on the second phase of its residential project Adora Park in Arad,” explains BRCC’s head.

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And more investments should follow given that, over the past years, Romania has strengthened its position as a location of choice for the British, suggests Crocker. “This is in some part because of the positive changes to the business environment, including greater transparency, one of the fastest growing economies in the EU over the last couple of years and availability of a technically skilled workforce with excellent language skills,” he explains.

The global economic environment is also favorable, making UK companies look at Romania as a new opportunity for investment, especially as costs increase in places such as Asia and “near sure solutions in Europe are becoming more viable and attractive”, he adds. “We believe the necessary ingredients are in place for British companies to win even more business in Romania and newcomers will target sectors such as food and drink, retail, real estate, healthcare, energy and transport, as well as financial and IT services,” continues Crocker.

In particular real estate, where increased activity is indicative of new investors entering the market and already established players resuming acquisitions, food and drink and retail, where secondary and tertiary cities are driving new developments, show potential for future investments, according to BRCC’s CEO.

The UK is a major economic and trading partner for Romania, says Crocker. Bilateral trade reached EUR 3.95 billion in 2015, the highest level reported so far in the two countries’ bilateral history and the upward trend maintained in 2016, he adds.  There are more than 5,000 British companies active in Romania, with a total subscribed capital of over EUR 1.01 billion, indicate BRCC data.