The need for speed in economy

The need for speed in economy

It is wrong of failing in doing things but is even worse not to do anything to repair them, states Constantin Stroe, Vice-president of the board of Dacia car manufacturer and also, the President of ACAROM (The Association for Automotive Constructors in Romania)



Each citizen of this country created by now its own analysis and ranking of the multiple threats that are hovering over the Romanian economy and also are impacting the business and social climate. The last years showed how the major internal challenges and threats, created within the Romanian economy, gradually worsened and reached the malign state under own eyes. But their cure comes not cheap and it is not simple to be applied. The worst of it is that no facts prove that there is actually an intention of even starting their treatment.



If there is to name few of the most dangerous aspects for the economy, some should be named: the deepening poverty of the population, the educational system that is tottering and outdated and what is worse, it effects on a log term the human capital of this country. Also, to continue the listing of what stumbles the local economy from its moving ahead, is the continuous denial of the law ruling and the corruption infiltrating in each of the social segments. Besides, the social and civil society are lacking a coherent and homogenous voice. To all these, the delays in infrastructure and transport projects and the weak domestic capital are also worsening the local climate, either it is about economy or civil society.



The Government’s Consultative Council has a “wishful list”



So far, the Romanian Government identified multiple measures to enhance each economy sector that have been promoted with every channel. On the agenda of the consultative council of the Prime Minister, established in April, leading economic sectors representatives brought up a wide range of proposed measures, some specific, some of general interest. Following their discussions, a lot of measures of general interest have been submitted to be analyzed by the Government and the Prime Minister in function at that time. But the Government’s change from the spring interrupted the process. Still, most of the ideas and measures suggested a few months ago still remain actual and urgent and the present Prime Minister has decided to revive the idea of the advisory council.



The “wishful” list of the consultative council gathered in April comprised:



- Fiscal incentives for research, development and innovation. There is no need to mention that the European strategies place the idea of innovation in the middle of the economic process of each country. This approach is a correct and logical one but, if we are to compare with the local landscape, Romania suffers badly in this respect. In the automotive industry, the car parts manufacturers just don’t deliver enough innovative projects in order to sustain a global competition. Academic research has not been synchronized so far with the global effective production needs and therefore, the local automotive production is lacking seriously the feasible innovation, adjusted to the present. This is a pity because the automotive industry has a large potential in Romania. On the other hand, the fiscal incentives would encourage multinational companies to relocate an R&D center here, which leads, as known, in many beneficial side effects in domestic economy. These aspects have been well received by the Ministry of Finance and it is expected to be introduced in the legislative process

- Completion of the legislative regulation regarding innovation at the workplace. This law aims to stimulate the companies in order to implement the valuable ideas of employees in the production. This initiative is still at the Ministry of Economy and has to be soon submitted for approval in the Government’s meetings

- There is a need to implement with discernment and responsibility the operations comprised in the Sectorial Operational Programme and targeting the development of the competitiveness poles and industrial clusters. The fear is that, once again, the good intentions can be altered in questionable achievements

- Although eco-mobility, including electric cars, doesn’t represent a major priority in Romania, the manufacturing industry is speeding in the technologically-developed countries. The increase of production of electric or hybrid cars in these countries could deliver an opportunity for Romania in order to develop a niche market for producing parts and subassemblies for electric vehicles, especially through a foreign investment placement. The strategy for development of infrastructure for eco-mobility (started over 2 years) remains actual and useful in order to identify the ways, the resources and the local policies needed to apply it

- Enhancing the highways development program is a major condition in order that the local companies to be linked to the European logistics flows. Delays in this program and the continuous changes of the priorities affect also the automotive segment. Let’s not forget that Ford might not be able to transport the manufactured cars at Craiova to the countries where it exports and also, let’s remember how Mercedes chose not to invest in a major production facility in our country because of the local poor infrastructure.



Besides all these, the financings in the economy are capital. The banks know the best how to do it but they have to be interested in doing this. “The buttons” that control the resuming of this process lay in the hand of The National Bank of Romania, the Romanian Government and also, the potential credit clients.



Of course, there is no wonder recipe in order to fulfill the needs of the Romanian economy. So far, we kept on applying “wonder recipes” and the results are obvious. It is really necessary and not at all wrong to import solutions that showed results in another EU state, importing also the monitoring and supervision mechanism and staff. Such recipe, simple and transparent, supervised by foreign specialists will visibly enhance the interest of companies to access European funds and to use them correctly and effective.