With inflation making its way through Europe, Romania was hit as well but the economy is still developing steadily, with energy, real estate, and infrastructure the sectors to look out for, according to MPR Partners Partner Dana Radulescu.
“The government has enacted measures to protect the people from surging prices, especially in the energy sector,” Radulescu begins. “With the inflation wave sweeping through Europe, some stopgaps had to be placed in order to protect citizens, so the Romanian government defined certain consumption thresholds to moderate the usage of energy and to prevent the high energy prices fallout.”
Furthermore, Radulescu shares that the government has begun with “the implementation of certain programs aimed at helping low-income citizens, like issuing vouchers for food.” She reports that people are discontented because of the overall surge in prices due to inflation. “Still, the social democrats and the liberals have a strong coalition in place and the political climate is stable and safe, irrespective of all other goings-on.”
Taking a sidestep and assessing other parts of the Romanian economy, Radulescu reports that “things are not that much different to other European countries. The economy seems to be developing steadily, despite the rising inflation, and M&A transactions are abundant, especially in the energy sector.” She reports that, as the pandemic is dying down, the pace is picking up. “With COVID-19 becoming less of a burden on business, the war in Ukraine has been the major source of investor concern – but it remains to be seen if and by what margin it ends up slowing things as the pandemic did,” she explains.
The most active business sectors are, according to Radulescu, energy and real estate. “Real estate is heading in a new direction, in terms of what projects are being developed. As people return to office work, it will be interesting to see what kinds of development projects get targeted first,” she says. As for energy, Radulescu stresses that “wind and solar are the hottest tickets right now.”
Finally, Radulescu reports that the infrastructure sector is poised to boom as well. “With EU fund money coming in, it would appear that these projects will be picking up. It is no secret that an infrastructure overhaul is needed, and I expect that resources will be directed towards these kinds of projects,” Radulescu concludes.
