EY Romania Attractiveness Survey 2023 reveals optimistic investment climate

EY Romania Attractiveness Survey 2023 reveals optimistic investment climate

Romania recorded an 86% increase in the number of FDI projects in 2022, making it the fifteenth most attractive European investment destination

  • 63% of respondents to the EY Romania Attractiveness Survey 2023 plan to establish or expand operations in Romania, compared to 53% in the previous year
  • FDI totaled EUR10 billion in 2022, 12% higher than the prior year’s record of EUR8.9 billion
  • The proportion planning to invest over EUR100 million practically doubled to almost 14% compared to just 7% in 2022

Romania recorded an 86% increase in the number of FDI projects in 2022, making it the fifteenth most attractive European investment destination, up seven places from the previous year according to the 2023 edition of the annual report EY Romania Attractiveness Survey.

Although Romania is by no means insulated from the global economic and geopolitical turbulence, it has shown greater resilience than many European countries and experienced a sharp rebound in foreign investment since 2020. FDI totaled EUR10 billion in 2022, 12% higher than the prior year’s record of EUR8.9 billion.

Romania still lagged Poland and Serbia among the Central and Eastern European markets. But despite this, investors are increasingly confident about the outlook, with 63% of those surveyed saying they plan to invest in Romania during 2023, compared to 53% at the time of the 2022 survey.

This increased confidence was also reflected in the fact that almost twice as many executives plan to invest more than EUR100 million in 2023 (14%) compared to a year earlier (7%). However, the majority (72%) still plan to invest less than EUR10 million. Developing bankable investment projects of scale will be critical to the economic transformation of Romania in the coming years. The EUR80 billion of EU program funding available for 2021-2027 should be the catalyst for change and act as a multiplier by stimulating additional private sector investment.

Bogdan Ion, Country Managing Partner EY Romania & Moldova and Chief Operating Officer for EY South-East & Central Europe and Central Asia (CESA): "Despite global challenges, Romania demonstrates remarkable economic resilience and high investment attractiveness. With impressive growth in foreign direct investment, our country is emerging as a key hub for investors, offering excelent opportunities in key sectors such as technology, sustainability and renewable energy. Now is the time for Romania to strengthen its position on the European investment map."

FDI projects were highly concentrated in 2022, with five cities accounting for 71% of all projects. Bucharest  (35%) remained the preferred location for investors, followed by Iasi (13%), Cluj (12%), Timisoara (7%) and Brasov (4%). Investment in four of these cities was also highly concentrated in one sector; software and IT services: 63% in Cluj, 60% in Timisoara, 48% in Bucharest and 33% in Iasi.

In 2022, Germany ranked first among the countries investing into Romania, both in terms of the number of projects and number of jobs created. The top-3 in terms of the number of projects was rounded-up by the United States of America (USA) and Switzerland, while Serbia and Ireland held joint second place in terms of the number of jobs created. The five projects invested into by Serbia (4) and Ireland (1), each created 1,000 new positions in the software and IT services sector.

A path to unlock Romania’s FDI potential

Unlocking the growth potential of small and medium enterprises (SMEs), which represent the engine room of the Romanian economy will be critical to maintaining Romania’s competitive position. Focusing on support for SMEs was cited as the main priority among respondents to our survey (45%), followed by support for high-tech industries and innovation (38%), many of which sit within the start-up and scale-up segment of the SME economy. With global investors, and increasingly consumers, paying ever more attention to the ESG credentials of businesses (34%), it will be essential for Romania to foster environmental policies and attitudes in the country that ensure investment opportunities meet these criteria.

What factors are shaping the appeal of Romania as an investment destination

Romania should play to its competitive strengths while taking swift action to address areas where investors perceive it has a disadvantage. The software and IT services sector has been the bedrock of foreign direct investment in recent years, and in this context, it will be important for Romania to continue developing the digital skills and culture required to ensure the availability of a workforce needed by future foreign investors. At the same time, Romania needs to do more to strengthen its network of technology start-ups and research institutions, provide greater protection for intellectual property rights and, support government and regulators to drive digital transformation. Ensuring such factors are given the prominence they deserve will be key to sustaining FDI in Romania’s high-tech sector.

While the war in Ukraine was not identified as a key factor impacting respondents investment plans in 2023, they did point to Romania’s membership of the European Union and NATO as its most important asset (28%). This demonstrates that security concerns remain high on the agenda and that investors perceive membership of these bodies adds significant weight to the attractiveness of a country, particularly during times of uncertainty. Romania plays an important role in the economic and security apparatus of Europe with the opportunity to further elevate its position by maximizing the deployment of funds available to support transformation and increase resilience in these areas.   

For Romania to sustain its competitive position and further improve its attractiveness among the European heavyweights, it will be critical to stimulate economic and technological development, reduce bureaucracy and ensure investors view the country’s legal framework as transparent and stable. This will help to ensure that Romania creates a progressive investor friendly environment, increasing the likelihood that the number of investment projects will grow beyond the level of the previous peak.



About EY Romania

EY is one of the world's leading professional services firms with 395,442employees in more than 700 offices across 150 countries, and revenues of approx. $49.4 billion in the financial year that ended on 30 June 2023. Our network is the most integrated worldwide, and its resources help us provide our clients with services allowing them to take advantage of opportunities anywhere in the world.

With a presence in Romania ever since 1992, EY provides, through its more than 900 employees in Romania and the Republic of Moldova, integrated services in assurance, tax, strategy and transactions, and consulting to clients ranging from multinationals to local companies.

Our offices are based in Bucharest, Cluj-Napoca, Timisoara, Iasi and Chisinau. In 2014, EY Romania joined the only global competition dedicated to entrepreneurship, EY Entrepreneur Of The Year. The winner of the national award represents Romania at the world final taking place every year in June, at Monte Carlo. The title of World Entrepreneur Of The Year is awarded in the world final. For more information, please visit: www.ey.com

The perceived attractiveness of Romania

We define the attractiveness of a location as a combination of image, investor confidence, and the perception of a country’s or area’s ability to provide the most competitive benefits for FDI. The field research was conducted by Euromoney in February and March 2023 via online surveys, based on a representative panel of 103 decision-makers at C-Suite and director level.

Half of those paneled were located in Romania, one-third elsewhere in Europe, 11% in the USA with the remainder from Canada, China, South Africa and United Arab Emirates.