Acasă » Analyses » AHK Romania: German companies consider their own businesses and outlook stable

AHK Romania: German companies consider their own businesses and outlook stable

30 April 2024
Bogdan Tudorache

The latest business situation questionnaire carried out by AHK Romania this spring reveals a relatively stable business situation of German companies in Romania and positive prospects among them, but there are still many risks that overshadow the prospects of the Romanian economy. The survey presents the current economic and business situation of the companies, but also provides an overview of the most important risk factors for business development from the companies’ point of view, as well as an assessment of the conditions that Romania offers as an investment location, AHK Romania officials claim.

Thus, the current situation of German companies in Romania has slightly worsened compared to the spring of 2023, which is now considered good by only 33% of those surveyed (in 2023: 45%). A percentage of 59% of them consider the current situation to be satisfactory (2023: 47%), while 8% consider it bad. In relation to expectations regarding the evolution of their own businesses, there are no significant changes compared to last year, with the mood being generally positive: almost 40% of those questioned believe that their businesses will do better in the next 12 months (2023: 46%) , and 22% see them getting worse (2023: 16%).

And the outlook for the economy over the next 12 months has worsened slightly compared to last year. Thus, only 19% of respondents expect an improvement (2023: 25%), while 38% are pessimistic (2023: 29%), and 43% do not expect any change (2023: 46%). More than 42% of the companies surveyed expect an increase in turnover this year, while 33% of them expect no change. “Despite the relatively good business situation and positive prospects, German companies in Romania fear negative developments in the fiscal framework starting in 2025, against the background of the high structural budget deficit and the need to take drastic measures after this year’s elections. We remain convinced that tax evasion in particular must be combated more effectively before higher taxes are levied on those who already pay taxes and duties”, says Sebastian Metz, general director and member of the Board of Directors of AHK Romania.

It is gratifying that companies intend to keep their number of employees, and even increase it: more than 41% of those asked said they want to hire more staff (2023:42%), and 41% declare that they they will maintain the number of employees. And investment intentions remain unchanged for the next 12 months. 34% of companies plan to increase investments (2023: 40%), while only 20% are more cautious and plan to spend less on investments (2023: 24%).

However, the biggest risks for development are the lack of qualified personnel and the increase in labor costs (for 58% of companies). To counteract these risks, companies propose as measures continuous training (57%), acceleration of automation and digitization (57%), intensification of cooperation with educational institutions (45%). Calling on temporary workers is also considered by 28% of companies (2023: 14%).

Another risk for business is the decrease in demand, a risk taken into account by 49% of the surveyed companies. They expect a continuation of the demand crisis, both from the country and from abroad. Low demand is also partly due to the poor economic situation in Germany. Energy and commodity prices also continue to cause problems for companies. On the other hand, companies no longer consider the “classic” infrastructure-related risk so great. Only 11% of them still see this factor as a risk, after financing and legal stability. “Infrastructure development shows that Romania has made significant progress in this field in the last 2-3 years. Considerable investments have been and are being made in the development of economic infrastructure, including the development of roads/highways, railway infrastructure, energy production and the development of electricity networks, the latter being absolutely necessary, especially in the context of the transition to green energy “, says Sebastian Metz, general director of AHK Romania.

Regarding the characteristics of the investment location, Romania gains points through membership of the European Union (72 percentage points), through the quality of telecommunications, including internet and services, with which 55% of companies are satisfied, and 19% very satisfied. It is also worth noting that access to public financing and European funds has improved (from -30 percentage points last year to -13 in the spring of 2024).

The conditions for research and development are on a positive trend (from -17 to -2 points), proof of the fact that Romania is becoming an increasingly important investment location for investments in research and development. The well-positioned university landscape at the national level creates good conditions in this regard. But in the field of education, both in the university and vocational training areas, improvements are needed. The level of satisfaction of companies related to this aspect is low (-2 and -31 % points respectively). “Urgent, significantly higher investments in professional and continuous training are needed, both on the part of the companies, but especially on the part of the Romanian state. Otherwise the digital and green transition of our economy will not succeed, because for this we need qualified personnel. The target must be to reach the threshold of 6% of GDP for education and 2% of GDP for research”, emphasized Sebastian Metz, general director of AHK Romania.

The availability of qualified personnel is one of the biggest challenges for companies and concerns both skilled workers and university graduates. The migration of Romanian specialists to Western Europe, the aging of the population, but also the underfunding of the education system are the main reasons for the acute lack of qualified personnel.

The productivity and performance of employees, as well as the flexibility of labor legislation, have lower scores than in the previous year. And the administrative and political framework conditions have slightly worsened and remain in negative territory. Of these, the best rated are legal stability (-12 points) and social and political stability (-20 points), as they have undergone obvious positive changes compared to the 2018-2019 period.

Most of the companies that responded to the survey are still concerned about the disruption of supply chains. To permanently increase supply flexibility and security in supply chains, most focus on supplier diversification (over 38%) and product portfolio adaptation (25%). In the medium term, 25% of firms intend to shorten supply chains or enter into long-term supply contracts (24%).

When asked if they would still choose Romania as an investment location, 88% of the companies asked answered “yes”, the highest percentage since 2017.


Autor: Bogdan Tudorache

Active in the economic and business press for the past 26 years, Bogdan graduated Law and then attended intensive courses in Economics and Business English. He went up to the position of editor-in-chief since 2006 and has provided management and editorial policy for numerous economic publications dedicated especially to the community of foreign investors in Romania. From 2003 to 2013 he was active mainly in the financial-banking sector. He started freelancing for Energynomics in 2013, notable for his advanced knowledge of markets, business communities and a mature editorial style, both in Romanian and English.

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