BR/11/2020

November, 2020 / Volume 24, Issue 10

www.business-review.eu

OPPORTUNITIES IN ROMANIAN ENTREPRENEURSHIP AFTER A PANDEMIC YEAR

23

LOCAL STARTUPS EMBARK ON EU GREEN DEAL MEGA-PROJECT

26

UNITED STATES GETTING MORE INVOLVED IN ROMANIA’S ECONOMY

28

PANDEMIC ACCELERATING LABOUR MARKET TRANSFORMATION

30

FDI TO PLAY PIVOTAL ROLE IN ROMANIA’S RECOVERY

www.business-review.eu Business Review | November 2020

EDITORIAL 3

• Editorial •

COVER STORY

Anda Sebesi • Editor-in-Chief • 6 FDI to play pivotal role in Romania’s recovery

ENTREPRENEURSHIP

Pressing forward in times of crisis

D

ue to its close links to the global economy, Romania was hit hard by the coronavirus pandemic. The health crisis was doubled by an economic one, as well as by uncertain-

ties regarding short to medium-term developments, which put many investment plans on hold and made investors more cautious

23 Opportunities in Romanian entrepreneurship after a pandemic year

24 Move to remote work boosts clout of cybersecurity startups

26 Local startups embark on EU Green Deal mega-project

MACROECONOMY

when it came to injecting money into the economy.

Although 2018 and 2019 were good years for Romania in terms of foreign investments, 2020 brought a significant downturn. What should Romania do to attract more foreign investors? What sectors should it bank on to drive the economy and what should it expect

28 United States getting more involved in Romania’s economy

from them? Is it the financing the only problem the country’s corporate sector is facing right now? These were some of the questions addressed by speakers at the 7th edition of the Foreign Inves-

TECHNOLOGY

tors Summit, Business Review’s flagship event, which focused on Romania’s potential as an investment destination even in these difficult times.

As pundits say, one big problem of the local economy is the lack of so-called “middle class players,” meaning that we have only a

30 Pandemic accelerating labour market transformation

few large companies at the top (about 3,000) and many more small companies at the bottom. And this is one of the reasons why Romania has low levels of FDI: because there aren’t many opportunities here. In addition, our country faces three main problems when it comes to entrepreneurship: the structure of the economy, the entrepreneurial culture, and a wide range of problems companies face – from management to networking, corporate organisation, and process digitalization.

But there is also some good news: Romania could stand to benefit from the current context, on one condition: making scalable products that can penetrate other markets.

CITY 34 Food trends: Romanian farmers’ markets turning into sustainable businesses

36 Are sandwiches the next big thing on the local food market?

38 Who will save Romania’s independent cultural sector?

EDITOR-IN-CHIEF: Anda Sebesi JOURNALISTS: Aurel Constantin, Mihai Cristea, Romanita Oprea, Oana Vasiliu CONTRIBUTORS: Ovidiu Posirca, Sorin Melenciuc, Claudiu Vrinceanu COPY EDITOR: Anca Alexe PHOTO EDITOR: Mihai Constantineanu PHOTOS: Dreamstime ART DIRECTOR: Raluca Dumitru PUBLISHER: Bloc-Notes Media Network ADDRESS: Address: 4-6 Dimitrie Pompeiu Blvd, 6th floor, Globalworth Campus A, Bucharest, Romania SALES MANAGERS: Radu Fireteanu, Alexandra Rosca EVENTS & MARKETING MANAGER: Luiza Luca PRODUCTION: Dan Mitroi DISTRI­­BUTION: Eugen Musat EXECUTIVE DIRECTOR: George Moise GENERAL MANAGER: Catalin Alistari USA MANAGER: Oana Molodoi FOUNDING EDITOR: Bill Avery EMAILS: editorial@business-review.eu, sales@business-review.eu, events@business-review.eu SUBSCRIPTIONS on Manpres Distribution Business Review is a member of Fwei

Publicație auditată pe perioada Apr 2015 - Mar 2016

ISSN NO. 1453-729X

www.business-review.eu Business Review | November 2020

4 NEWS

WHO’S NEWS BR welcomes information for Who’s News.

Submissions may be edited fo­­­r length and clarity.

Get in touch at mihai.cristea@business-review.eu

Higher sales for retaliers, lower foot traffic in shops

By Mihai Cristea of respondents, predominantly from the food, discount or home decoration segments, saw their footfall slightly increasing or remaining constant year-on-year.

In terms of sales figures,

Burak Yildiran will be the new CEO of Patria Bank. Yildiran has 25 years of experience in banking and technology, 20 of which he spent with Garanti BBVA. Throughout his tenure, he has been responsible for business development, change management, customer experience, agile projects, digitalization, transformation, strategic leadership, and talent management. He was the Deputy General Manager and Operations Manager at Garanti BBVA Romania for six years. Burak holds an MBA from WU Executive Academy – University of Vienna and a BA in Business Administration from Hacettepe University.

Manuel Fernandez Amezaga is the new CEO of Sodexo Romania, starting November 2020. Amezaga is a manager with more than 20 years’ experience in payment technologies. He first joined Sodexo in 2010 and held leadership positions in Spain and the Philippines, working with private sector and government authorities. During his tenure as CEO of Sodexo Philippines he led the company on its digitalization journey, implementing numerous fintech solutions. page 5

27 percent of respondents reported sales increasing or remaining fairly in line with 2019 in the July-September period, which means that while fewer

Home decorations retailers expect their total sales to increase in 2020

people are entering shopping areas, they are spending more per shopping session than they

All retail players who sell

percent), footfall in stores was

did in the past. At the same

products online expect this

lower in the third quarter than

time, retailers who had retail

channel to generate a higher

during the same period of 2019,

park-type locations in their

share of their turnover in 2020

with quite a lot of them report-

portfolio were less affected.

compared to last year, with a

ing more than 40 percent fewer

quarter of respondents even

clients visiting shops in recent

period when stores were

estimating increases of over

months. This is more or less

closed, 42 percent of retailers

50 percent, according to a

in line with other metrics, like

expected 2020 turnovers to

survey conducted by Colliers

Google’s Community Mobility

be 30-50 percent lower than

International’s Retail Division

Indicators, which showed aver-

in 2019’s. However, there are

among more than 40 tenants

age traffic in retail and recreation

also some who expect the total

and landlords from the Roma-

areas to be at least 20 percent

volume of sales to increase in

nian retail sector. For the vast

below the usual numbers in Sep-

2020, such as food, DIY, home

majority of respondents (85

tember. Nevertheless, 15 percent

decorations or sports.

As a result of the lockdown

HR leaders prioritising wellbeing investments for 2021

By Mihai Cristea Focus group research con-

areas for investment for 2021,

ducted by e-days has revealed

45 percent of respondents chose

that “wellbeing” is the most

wellbeing as their key invest-

popular area of investment for

ment area, while 43 percent said

HR leaders moving into 2021.

they aimed to focus on investing

Asked to identify their top three

in employee engagement. 64

Investments in employee engagement are one of the HR leaders' strategic pillars

www.business-review.eu Business Review | November 2020

NEWS 5

Innova Capital agrees to buy PayPoint Romania

By Mihai Cristea Innova Capital, a leading private equity firm operating out of Poland, has agreed to buy PayPoint Romania from LSE-listed PayPoint plc. The sale is subject to competition and regulatory approvals, and therefore completion is anticipated to take place on March 31, 2021. PayPoint Romania is a market-leading consumer payments operator in Romania, collecting over 100 million bill payments for 85 percent of Romanian utility and telecom pro-

PayPoint Romania created an ecosistem of retailers, consumers and utility providers

Bogdan Ionita was appointed to lead the operations of GEFCO Romania, a subsidiary of GEFCO Group, after more than 14 years of tenure in the company. He joined GEFCO in 2006 as a manager of the Air & Sea Department and in time took over the management of Overland (Road and Rail) & Contract Logistics activities. In 2014 he was appointed as an Overland & Contract Logistics Manager of GEFCO Czech Republic and soon extended his responsibilities to the whole Cluster, uniting the Czech Republic and Slovakia.

viders through a wide network of retail sites. Apart from bill

company management, we want

built on interactions and ben-

payments, it offers also mobile

to support PayPoint Romania’s

efits for all participants. With

top-ups, money transfers, and

growth and expand its portfolio

consumers attracted by the

credit/debit card acceptance

of services. PayPoint Romania is

convenience and accessibility

services.

a perfect base to develop further

of terminals, retailers become

payment-related services which

the heart of their neighbour-

cess to its terminals, effective

allow clients to access even safer,

hoods by providing an essential

relationships with retailers,

quicker, and easier payments”

service to their local communi-

and reliable services, the com-

said Krzysztof Kulig, Senior Part-

ties. Service providers such

pany is a preferred local brand

ner at Innova Capital.

as PayPoint Romania’s clients

“Supported by the easy ac-

Over the years of its lead-

benefit from an outsourced bill

ties and service providers. By

ing market presence, PayPoint

payment solution that provides

leveraging our experience and

Romania has been able to create

country coverage with a net-

know-how in payment process-

a strong ecosystem of retailers,

work giving access to a broad

ing and working closely with

consumers, and utility providers

demographic.

and trusted partner to utili-

Anca Simionescu was announced by Lion’s Head Investments as the new Country Manager in Romania, responsible for the implementation of the Group’s strategy in the country. A senior real estate professional who has worked on various office and residential projects in Bucharest, Anca has 15 years of experience in commercial and residential real estate investments, asset management, and business development.

percent cited COVID-19 as the biggest challenge of next year while 47 percent said they felt unprepared for the “new world of work” post-COVID-19.

The remaining respondents were split between budgetary concerns and a focus on continuing to engage staff. “HR departments across the world are coming to understand that, if you want to steer your business in a positive direction, you need to accommodate these different ways of working,” said Steve Arnold, the CEO of e-days.

Renzo Taal has joined UiPath as Senior Vice President and Managing Director for EMEA. A wellrecognised leader in the European and international business arena, Taal brings to UiPath more than 20 years of experience in leadership and senior management roles in the technology industry. He holds a Master of Science in Business Administration from the Erasmus University, Rotterdam School of Management.

www.business-review.eu Business Review | November 2020

6 COVER STORY

FDI TO PLAY PIVOTAL ROLE IN ROMANIA’S RECOVERY Due to its close links to the global economy, Romania was hit hard by the coronavirus pandemic. The health crisis was doubled by an economic one, as well as by uncertainties regarding short to medium term developments, which put many investment plans on hold and made investors more cautious when it came to injecting money in the economy.

Although 2018 and 2019 were good years for Romania in terms of foreign investments, 2020 brought a significant downturn. What should Romania do to attract more foreign investors? What sectors should it bank on to drive the economy and what should it expect from them? These are the pressing questions we will try to answer below.

By Anda Sebesi

www.business-review.eu Business Review | November 2020

A

COVER STORY 7

ccording to the September 2020 edition of the Foreign Inves-

GOOD NEWS ON THE HORIZON

tors’ Council’s “Foreign Direct Investment in Romania”

Recently, the Fitch rating agency announced that it had maintained

study, global FDI flows will be significantly impacted by the

Romania’s country rating. “Although Fitch expects the economy to

pandemic. For the 2020-2021 period, the United Nations Conference

recover starting with 2021, the uncertainty about political develop-

on Trade and Development (UNCTAD) estimates a reduction in FDI

ments along with the increase of the coronavirus outbreak both

flows of up to 40 percent.

globally and on the local market will continue to affect the economic

The study highlights that Romania’s FDI flows had a negative

and fiscal perspectives. According to our base scenario, Roma-

net value of EUR –338 million in the first five months of 2020. Even

nia’s economy will post an average increase of 4 percent between

though this trend is expected to reverse in the coming months, the

2021-2022, supported by the recovery of the domestic and external

initial signal provided by the direction of FDI in the first half of 2020

demand. Yet, there are some uncertainties about the medium-term

was a reflection of the relatively high risk that foreign investors

impact of the pandemic on Romania’s economy, because some

see in the Romanian economy and their lack of confidence in the

sectors like IT and communications could see benefits while small

business environment’s short-term prospects. Last year, Romania

companies from the manufacturing sector could suffer permanent

attracted EUR 5.17 billion in FDIs and posted a total balance of EUR

losses,” Fitch analysts said.

88.3 billion, according to data

Currently, Romania has an

provided by the National Bank of

investment grade from all three

Romania (BNR). 2019 was the sec-

rating agencies, but it ranks on

ond year in a row when Romania

the lowest level in this category,

exceeded the level of EUR 5 billion

with a negative perspective. A

in FDIs (it had reached EUR 5.26

potential downgrade could take

billion in 2018).

the country’s rating to the junk

The same study shows that

category, which means Romania

relocating manufacturing facilities

will no longer be recommended to

near the main consuming coun-

investors.

tries (especially those currently operating in China) gives Romania the opportunity to position

WHAT DO C-LEVEL MANAGERS THINK?

itself as an attractive FDI target.

According to the first edition of

However, Romania is competing

Confidex, a study conducted by

with other states in the region and

Impetum Group on more than 500

given the reduced competitiveness

C-level managers from Romanian

of its regions compared to those of

companies, the average turnover

neighbouring states and the lack of

of firms in Romania will decrease

coherent public policy measures to

by 20 percent this year. “For

attract high value-added FDI, there

companies with a turnover of less

is a high chance that the country

than EUR 1 million, the drop will

will continue to attract mainly low value-adding activities with low

reach 23 percent, while for medium-sized companies with turn-

technological intensity.

overs between EUR 1-5 million will experience an average drop of 17

It would be beneficial for Romania to have a more significant

percent. Large companies will be less affected, posting a 12 percent

presence on international markets, especially during this period,

decrease in turnover. The most affected sectors will be hospitality

with the help of government agencies dedicated to attracting invest-

(43 percent turnover drop), services (23 percent), and transportation

ments and promoting exports, such as Invest Romania. The services

(20 percent),” says Andrei Cionca, CEO and co-founder of Impe-

sector has the largest share of FDI stocks in Romania right now,

tum Group. He adds that the study also asked managers what they

accounting for about 47 percent of the total. By contrast, in the high-

thought about the measures the Romanian government took during

tech sector, FDI stocks as a share of the total in the manufacturing

the lockdown. “55 percent said that the measures were adequate,

industry are only at 5 percent, the lowest level in the region.

26 percent found them excessive, and 17 percent thought they were

Romania's competitiveness deficiencies are also reflected by the

insufficient. In addition, the absence of a plan to finance large com-

regional competitiveness index. None of Romania’s eight develop-

panies was a problem that respondents identified,” Cionca adds. The

ment regions match the average performance level of the European

study, which covered the first three months of the pandemic, found

Union (EU) – not even the Bucharest-Ilfov region. Public policy

that respondents expected the economy to experience a V-shaped

measures could focus on encouraging FDI with the highest possible

recovery, over various periods, as follows: 13 months in case of their

added value and on facilitating the reorientation of FDI to high-tech

company, 15 months for the sector they operated in, 22 months for

and knowledge-intensive industries in service-related fields.

the European economy, and 26 months for the Romanian economy.

www.business-review.eu Business Review | November 2020

8 COVER STORY

High potential for local office building segment Companies occupying office space need to account for several types of work arrangements, including full-time remote, part-time remote, and full-time on-site.

They also need to increase technological investments in order to support remote working, according to a survey carried out by real estate firm CBRE.

W

By Anda Sebesi By comparison, the total office

hile remote working has been on compa-

stock in Romania stood at more

nies’ minds since the

than 4 million sqm in Bucharest

beginning of the health crisis,

and the main regional cities last

the aftermath of the pandemic

year. “Bucharest has good pros-

might bring a shift towards the

pects because the volume of office

fluid workplace and improved

spaces delivered on the market

office wellness facilities. On the

so far is still low compared to the

Romanian market, companies may

city’s population and the market’s

choose to keep their current spaces

potential. While the Bucharest

and ask their employees to come

office stock reaches 3 million sqm,

back into the office in shifts. “For

Warsaw’s exceeds 5 million sqm.

people working inside the office,

In addition, a large share of the

physical distance will be ensured

Romanian capital’s office stock

according to the safety standards

is represented by class B offices

imposed by local authorities, but

which cannot provide a safe work-

companies will still encourage

ing environment in the context of

face-to-face collaboration and

the pandemic,” says Antoniu Panait, managing director at Vastint

communication,” says Marius Scuta, head of the office department & tenant representation at real

Romania. While 2019 was by far the best year for Vastint Romania,

estate consultancy firm JLL Romania.

as it delivered 63,000 square meters which are now fully operational

Along similar lines, Fulga Dinu, country manager at Immofinanz

and equipped with the latest technologies – Timpuri Noi Square is

Romania, says that flexible working and home offices will be in even

95 percent leased and Business Garden Bucharest stands at over 75

greater demand, but that home offices will never completely replace

percent – the company is focusing on existing projects and tenants

the office workstation. “We are convinced that the social aspect and

and on leasing vacant premises. “In a normal context, we would

the personal interaction are crucial for innovation and productivity

have started a new phase of the Timpuri Noi project. If the market

in companies. We will therefore continue to see demand for high-

has the capacity to absorb new office deliveries, we can continue the

quality office spaces with benefits. In the medium to long term, there

development,” adds Panait.

may of course be changes in individual tenants’ space requirements,” Dinu explains.

In the meantime, developers are continuing to work on large of-

Last but not least, Dinu of Immofinanz Romania says that the company has eight operational office properties and two office buildings currently undergoing a modernisation process in Bucharest and

fice projects on the local market. Between mid-2020 and the end of

Voluntari, with a 91 percent overall occupancy rate. “Despite the

2021, a total of 325,000 sqm of modern office spaces are expected in

pandemic, we signed contracts for more than 40,000 sqm during

Bucharest and some 206,000 sqm will be completed in large regional

the first nine months of 2020. These included contract extensions

cities (Cluj-Napoca, Timisoara, Iasi, and Brasov).

and expansions as well as new tenants joining our office buildings,”

The market for coworking and flexible spaces could see a re-

Dinu notes. In her opinion, office buildings nowadays must offer

surgence as companies are exploring different work arrangements

much more than just workspaces; they’re more like living spaces,

that don’t raise any health risks for their employees. However, the

with employees’ wellbeing becoming a top priority. “This will be the

development of more flexible office spaces has been rather limited,

essence of the office experience and we expect this trend to continue

and this segment had only 84,000 sqm of operational spaces spread

in the future as office landlords pay more attention to the needs of

across 106 venues at the end of 2019.

their modern customers,” she adds.

www.business-review.eu Business Review | November 2020

ADVERTORIAL 9

Speedwell aims developing new large scale projects in Romania Didier Balcaen, the CEO of Speedweel highlights the main projects of the company on the local market and the way it adapted to the new context generated by the pandemic.

In what regards the office market, the current situation of many employees working from home has made an impact. There has been a decrease in office spaces leasing request and we are adapting to this new reality by doing what a true partner of the tenants does: being open to their requests and offering more flexible conditions. It’s important to collaborate and see tenants as more than just a client. They are also our partners.

What are your plans on the local market?

What are your main projects developed in

developing another mixed-use project, PALTIM,

We are planning to continue with the proj-

Romania so far?

located in Timisoara. It includes 15,000 sqm of

ects we are currently working on, through

We currently have several projects in differ-

A-class offices, approximately 300 residential

their delivery. Apart from this, our plan is

ent cities of Romania, in various develop-

units and a refurbished historical villa, all in a

to purchase at least 2 new plots in the next

ment stages. In Bucharest, we are developing

central location. For PALTIM, we are finalizing

year, focusing on Bucharest, but also on the

three projects, one A-class office project –

the PUZ stage and plan to start commercializing

major regional cities of Romania, following

MIRO, and two residential projects – THE IVY

early 2021. In Ramnicu Valcea, we manage a land

our strategy of increasing our pipeline of

and TRIAMA Residence. Located in North-

development of 10 ha for which we obtained the

new large scale developments in the local

ern Bucharest – Băneasa, MIRO, our office

PUZ and are currently selling allotments to other

market.

project, and THE IVY, the residential one,

developers, for a potential of up to 50 houses,

combine as a mixed-use set-up for a better

1,100 apartments and retail spaces.

How did you adapt to the current context?

Over the past 8 months, we have adapted to

work-life balance. MIRO offers 23,000 sqm of leasable office spaces, is 60% pre-leased to

What can you tell us about the residential and

this new way of working by implementing

date and will be delivered at the end of 2021.

office segments in Romania in the current con-

new tools, being on-guard for any delays

THE IVY, located within walking distance

text generated by the pandemic?

which might appear and putting the well-

from MIRO, features over 800 dwellings.

With every crisis there comes an opportunity for

being of our employees and collaborators

For the first phase consisting of 228 units,

development, and we are noticing that in the

first by taking preventive measures. Even so,

construction works will start before the end

current context as well. When it comes to the res-

the pandemic didn’t have a big impact on

of this year.

idential market, the positive impact of the pan-

our projects, and we didn’t have to pause the

The second residential project we are

demic represents a shift in the users’ perspective.

construction sites. The permitting process

developing in Bucharest, TRIAMA Residence,

Home buyers are looking to improve their quality

continued to function well, with no signifi-

is close to delivering its first phase compris-

of life since they are spending more time indoors.

cant delays. A special thanks to our amazing

ing of 66 apartments. After reaching the

Although we have seen an increased demand for

team, that has remained in positive spirit

“sold out” milestone for Phase 1, we have

houses compared to the one for apartments, the

and has shown to react extremely agile to

launched sales for next phase which includes

vast majority of demand will remain for the lat-

the current fast-changing circumstances.

68 units deliverable at the end of 2022.

ter category. Buyers are more interested in larger

PropTech is obviously another matter

In Cluj, we are finalizing our mixed-use

surface apartments, with at least a terrace and

we were already implementing, but now we

regeneration project, RECORD PARK. Through

more efficiency when it comes to the way every

have stepped up even more the application

it, we are adding to the market a total of 236

square meter is used. These are a few details that

of technology at the service of our buyers

apartments and approximately 15,000 sqm

we have always given importance to in all our

and tenant. This is materializing through the

of commercial spaces, mainly office and part

projects, even before the pandemic. Our aim is to

Capacity (Cegeka) smart parking system, the

retail, including a stand-alone WorldClass

offer a better standard of living and this can be

next step is the integration of BringMe Boxes

with a unique pool with retractable roof.

noticed in the attention to detail and the design

for easy online deliveries in both residential

Following RECORD PARK’s model, we are

concept.

and offices compounds.

www.business-review.eu Business Review | November 2020

10 COVER STORY

Scalable products could increase Romania’s competitiveness abroad While e-payments could lead to a significant shrinkage of the grey economy, the lack of financing is not Romanian companies’ only problem right now. The country needs to make a shift towards partnerships and create its “middle class of companies.”

A

By Anda Sebesi

ccording to Rudolf Vizen-

ond budget that takes into account

tal, CEO and co-founder

a negative cashflow and plans the

of ROCA Investments, the

decisions that need to be made in

current crisis has brought a change

that context. “This repositioning

to the concept of globalisation as

of the global economy could mean

well as an acceleration of digita-

that the Romanian economy might

lization and a widening of some

be better positioned than it was

gaps between countries or sectors.

at the beginning of the crisis, but

What is there to be done? “Our best

on one condition: making scalable

bet is to focus on things that will

products that can penetrate other

not change during these times,

markets,” he concludes.

such as a nation’s need for education, healthcare, culture, and food processing. A company should

ELECTRONIC PAYMENTS GAIN GROUND

build its pillars on elements that

E-payments make up a significant

will maintain their relevance in the medium and long term,” says Vizental.

In Vizental’s opinion, there is currently a lack of so-called “middle

part of both the financial sector and the local economy, and they help reduce the size of the grey economy, for example. According to Bogdan Patru, Public Policy Director

class players” in Romania’s business environment, meaning that we

at Mastercard, e-payments saw constant growth in Romania over the

have only a few large companies at the top (about 3,000) and many

past few years. The upward trend has been generated by two factors:

more small companies at the bottom. “This is one of the reasons why

consumers’ appetite for technology and tools that allow them to

Romania has low levels of FDI: because there aren’t many opportuni-

make payments in a safe, simple, and quick manner and the multiple

ties here.”

initiatives which have been implemented in order to increase access

Regarding the specifics of the Romanian market, Vizental

to e-payments. “But many things still need to be done in order for

highlights three major aspects: the structure of the economy, the

Romania to reach its maximum potential for e-payments,” the Mas-

entrepreneurial culture, and a wide range of problems companies

tercard executive argues.

face – from management to networking, corporate organisation,

According to Patru, following a study conducted by Mastercard

and process digitalization. “The local economy is still young, but its

and PricewaterhouseCoopers in 2014 to measure the impact of

entrepreneurial class is getting old. Many of those who started busi-

e-payments on the economy, Mastercard developed ten measures

nesses in the ’90s are close to retirement, and many of them haven’t

aimed at shrinking the grey economy by 9.9 percent of GDP and con-

solved their succession problem,” he points out.

tributing to the collection of EUR 14 billion in the state budget over

In addition, the communist period had the effect of generating

a seven-year period. The measures included: reducing cash limits,

scepticism among Romanians regarding partnerships. “When you

strengthening fiscal discipline, easing budget collections, increasing

have more than 30 employees, you can’t do it all by yourself, and

the number of POSs and cards, connecting cash registries with inte-

if don’t set up any partnerships your company risks not being able

grated POSs to the internet, reporting card transactions, organising

to rise above a certain limit. This culture should move on from the

a fiscal lottery, offering social aid through pre-paid cards, limiting

individualistic perspective and start embracing the concept of part-

salary payments in cash, and encouraging e-payments through fiscal

nerships.”

facilities. “Unfortunately, of the ten measures proposed at the time,

As for the coming year, Vizental thinks that companies should

only the fiscal lottery has been implemented, six others have been

draw up two budgets: a realistic and balanced one, based on a sce-

implemented only partially, while no moves have been made on the

nario where things are stable and comparable to this year, and a sec-

remaining three,” Patru explains.

www.business-review.eu Business Review | November 2020

COVER STORY 11

Romania’s automotive market braces for paradigm shift Both the global and the local automotive industries have been hit hard by the pandemic, which has affected all three pillars of the GDP: consumption, production, and incomes. But despite this complex and difficult situation, Romania marked two significant firsts: one coming from Ford and the other from Dacia.

I

By Anda Sebesi

n October, Renault Group

Lier, CEO at BASF. Unlike its more

launched Dacia Spring, its first

developed European peers, Roma-

fully electric car, which will be

nia has a massive infrastructure

produced by the Romanian brand,

deficit doubled by a low level of

while Ford Puma, the SUV manu-

predictability to its legal frame-

factured in Craiova, sold 42,000

work. Mihai Blodijar, the general

units in Q3, ranking third behind

director of Robert Bosch and the

the Fiesta and Focus models. It

representative of the Bosch Group

was the first time when a model

In Romania, says that “despite the

manufactured at the Romanian

fact that it will be difficult to keep

plant came close to the American

the Romanian automotive industry

automaker’s two best sellers on the

on a sustainable, competitive level,

European market.

developing new technologies for future mobility systems – in terms

Furthermore, according to Sebastian Popescu, counsel and state aid advisor at Noerr, the au-

of both engineering and manufacturing – such as electrical vehicles,

tomotive industry is one of the biggest recipients of state aid funds.

plug-in hybrids, fuel cells or autonomous driving systems might just

“Hence, an automotive player can develop a project to finance its as-

be the answer and the opportunity we have been looking for. In my

sets or, in case it is looking towards an R&D project, it can get money

view, the sector’s biggest challenge will be preparing the local auto-

for salaries.”

motive industry for a stepwise reduction of its CO2 footprint in order

Apart from the launch of Dacia Spring, Christophe Dridi, manag-

to achieve carbon neutrality by 2030.”

ing director at Groupe Renault Romania and CEO of Automobile Dacia, says that his company has many solutions to reduce its carbon

WHAT’S NEXT

emissions. “For us, the quickest solution was LPG. In 2019, LPG

Lier of BASF says that the future of mobility will definitely look dif-

represented 5 percent of production at our plant in Mioveni and now

ferent – new players and new technologies are gaining ground and

it has reached 40 percent, which means that this represents a real

we are witnessing a real paradigm shift. “Nearshoring or transition-

answer for our customers. Dacia has always had an out of the box ap-

ing production from western EU countries to Romania for cost sav-

proach in order to respond to the real needs of its customers and pro-

ings, will continue to represent a big opportunity. The excellent local

pose alternative solutions,” Dridi noted. On similar lines, Popescu of

product portfolio with new and improved models from Dacia and

Noerr says that auto technology is ahead of many other sectors. “Our

Ford is also a great present and future opportunity, as we’re seeing

environmental protection ambitions can sometimes be a bit too opti-

consumer preferences shifting towards cars with an excellent value

mistic, but it’s a proactive approach and investments are highly sup-

for money, which both brands offer in Romania,” he says. He adds

portive of it.” As a result of the pandemic, people tend to think twice

that signs of recovery are noticeable worldwide, yet they remain

before making a decision to purchase expensive consumer goods like

fragile due to the danger of new lockdowns and customers hesitat-

cars. “In April and May we experienced a shutdown of almost the

ing to buy cars due to the overall uncertainty. “But I believe the car

entire automotive industry across the world – a real collapse due to

industry is strong here, and the government has taken the right mea-

COVID-19 lockdowns and weak demand. Original equipment manu-

sures. One positive decision was to introduce Kurzarbeit for the local

facturers like Dacia and Ford stopped production, and consequently

automotive industry,” Lier adds. Moreover, Boldijar says that a much

so did almost all the tire suppliers in Romania and Europe. Fortu-

more flexible labour legislation combined with a rapid digitalization

nately, the situation improved in August, and September was a good

of the public administration would be enormously helpful for both

month for BASF’s Automotive Business in Romania,” says Andreas

employers and employees, regardless of their industry.

www.business-review.eu Business Review | November 2020

12 COVER STORY

Hundreds of thousands of jobs will be created as technology takes centre stage In the next five years, over 400,000 new jobs will be created in Romania’s IT&C industry, doubling the current number. The development of technical and digital skills must accelerate to meet the demand for specialists and to sustain the country’s economic development, but neither universities nor companies have the capacity to respond to the needs of the future, said Daniel Rusen, Marketing and Operations Director at Microsoft Romania, at Business Review’s Foreign Investors Summit in late October.

R

By Aurel Constantin

usen noted that a glob-

just between people. “Traffic is

al study conducted by

booming anyway, it’s not only

Microsoft and LinkedIn

because of the pandemic. In

this summer found that in the

recent years it has grown by 50

next five years, around 150

percent each year and it is esti-

million new jobs will appear as

mated to increase fourfold over

a result of accelerated digitali-

the next five years,” Rebegea

zation. Of these, 1 million will

noted. “This means that we will

be in the area of data privacy,

need more storage infrastruc-

6 million in cybersecurity,

ture, as well as more secure

20 million in data analysis,

and faster connectivity. These

machine learning, and artificial

are the challenges faced by

intelligence, 23 million in cloud

network service and equipment

and data roles, and 98 million

providers,” he explained.

New jobs are emerging in

in software development.

technology development, in-

“This is good news, but the bad news is that we need

cluding at Ericsson, a company

qualified people to fill these

that only made hardware for

jobs. For Romania specifically,

120 years and recently started

this means around 645,000

making software as well. The special situation generated by

jobs will be created around new technology. If you think about the Romanian workforce, we

the pandemic has shown that the solutions offered by connectiv-

have around 200-250,000 people who are currently qualified to hold

ity, in terms of both hardware and software applications, are the

advanced technical jobs – developers, data analysts, cybersecurity

most appreciated and most desired by people working from home.

experts, and others - within the next five years this number will

Moreover, people are willing to invest in better connectivity when

reach 1 million,” Rusen said.

they need it.

“This pandemic has shown connectivity to be one of the most

As data traffic continues to increase, investments will be needed

important aspects of economic continuity. The period has highlight-

to maintain networks at capacity. A lesser known fact about Erics-

ed the strengths and weaknesses of networks, which have proven

son is that it has a factory in Timisoara that produces 5G network

resilient to the migration of employees from company offices to

equipment, in a unit with 1,400 people. “That's why Romania is very

working from home. Romania has very good broadband and mobile

important for us. The resilience of the supply chain is also important

networks,” said Dragos Mircea Rebegea, Country Manager at Ericsson

in order to no longer be dependent on a certain geographical region,”

Romania and Head of Sales for Romania and Moldova, adding that

Rebegea said. In the second quarter of 2020, 16 countries in the EU

the future will bring networks with even better speeds.

launched their 5G commercial networks. Currently, 5G population

All the members of this telecommunication ecosystem are start-

coverage reaches an average of 27 percent in the EU, with Romania’s

ing to discuss the implementation of software that goes beyond clas-

at 33 percent. “It may be a surprise, but Romania is doing very well,

sic functionalities, reaching industrial, B2B or B2B2C applications.

even if we are now very late with the implementation of 5G technol-

There is also a need for communication between remote devices, not

ogy,” the Ericsson manager explained.

www.business-review.eu Business Review | November 2020

COVER STORY 13

Mihnea Radulescu: We have an opportunity to move digitalization forward quickly The importance of digital infrastructure and the investments needed to maintain it at a high level have never been as obvious as they are now. Mihnea Radulescu, Enterprise Business Unit Director at Vodafone Romania, talked about the critical role of digital infrastructure and the impact of technology on businesses continuity at Business Review’s Foreign Investors Summit in late October.

By Aurel Constantin there are moments

digitalization and how they can attract this

when some steps can

money, as it will be an important opportunity

be skipped to move

in the coming years. It’s a chance for us to

forward quickly. We

jump over certain stages, as we did when we

often talk about our

launched mobile telephony in the late 1990s.

infrastructure, about

Within two years, the number of mobile

roads, railways, utilities,

connections had surpassed the number of

and so on. But now we

landlines,” he noted.

have an opportunity,

Digitalization doesn’t only mean finding

a moment when there

solutions to various problems; it also brings

are extra EU funds that

on a lot of processes that must be integrated

can be used to develop

into a company’s activity. It can help create

digital infrastructure. In

an ecosystem that keeps everything in check.

Germany, for example, a lot of money is being

LIFE DURING THE PANDEMIC

spent on digitizing

Technology helps us communicate and

infrastructure. We

continue our work and there are many

have the chance to do

employees who have been working from

this from scratch and

home for months, since the beginning of the

it should be a very im-

pandemic. And their behaviour, just like that

portant area of devel-

of companies, is changing.

opment for Romania,” Radulescu explained.

T

A second important area is represented by

“Almost half of firms expect working from home to last for at least another year from now. We will be in this situation for a while and we must ask ourselves how to better

echnology and digitalization are

SMEs. “Small companies account for over 50

adapt, since many employees miss the social

playing important roles in our lives

percent of the economy, which is a huge fig-

interaction they had at the office. Productiv-

all the time, but even more so amid

ure. In addition, SMEs employ more than 65

ity has increased since working from home

pandemic-related restrictions. “Technology

percent of the workforce, so we need to help

started, but let’s not forget that people who

is mostly seen as support for remote work-

this sector. Small and medium-sized com-

spend all this time at home are affected both

ing these days, but it has many more uses

panies will have to do business in a modern,

socially and physically. As providers of digital

and connotations. First of all, technology is

digital environment. And we come back to

solutions, we must adapt to create the best

pan-industrial; it is not invented for a single

European funds, because SMEs do not have

solutions for companies and their employ-

purpose. Today there are technologies such

much money on hand for investments in

ees,” Radulescu argued. Romania is ahead of

as the Internet of Things, that can cover any

digitalization, especially during this time. But

many states in terms of the speed and resil-

industry, any economic sector, from hospital-

there is a large amount of money available at

ience of its telecommunications infrastruc-

ity to industrial manufacturing,” said Mihnea

the European Commission – billions of euros

ture. “But investments in these networks

Radulescu.

– which will have to be spent in this sector,”

must carry on despite the pandemic; we have

the Vodafone executive added.

a commitment to continue investing in order

The crisis generated by COVID-19 is also creating opportunities and we should look at them with optimism. “In the life of a society

“As a solutions integrator, Vodafone needs to help companies understand the need for

to maintain the quality of the network,” he concluded.

www.business-review.eu Business Review | November 2020

14 COVER STORY

FIS speakers on Romania’s potential to attract valuable FDI The pandemic has taken a toll on economies all around the world. According to multiple studies, the global volume of foreign direct investment (FDI) will drop by 30 to 40 percent in 2020. During the 7th edition of the Foreign Investors Summit, speakers from key economic sectors pointed to the fact that Romania could begin attracting higher value-added FDI.

By Anda Sebesi

1

2

3

4

5

6

7

8

9

www.business-review.eu Business Review | November 2020

COVER STORY 15 cept of globalization. And when something changes, it opens up a good opportunity to foresee the next trends. We’ve witnessed an acceleration of digitalization while gaps between some countries or sectors have deepened. It is time for us all to be courageous and make decisions. Most wrong steps are taken when standing still.”

10

11

8. Bogdan Patru, Public Policy Director at Mastercard “We are seeing a real interest in implementing measures to accelerate digitalization in Romania. We’ve had a spectacular

1. Lara Tassan Zanin, Head of the European Investment Bank’s Group Representation in Romania

4. Andrei Cionca, CEO and co-founder of Impetum Group

increase in electronic payments in Roma-

"Romanian managers expect the local

current context. However, the percentage

“A vision for a modern and competitive

economy to recover in a V shape and at the

of electronic payments in Romania’s GDP is

Romania has to be digital and green.

beginning of this crisis they estimated that

still the lowest in Europe.”

Over the next two or three years, the

this recovery would take 13 months for their

country has to take advantage of the ex-

companies, 15 months for the sector in which

ceptional measures being deployed by the

they operate, 22 months for the European

9. Andreas Lier, CEO at BASF

European Union – the Modernisation Fund

economy, and 26 months for the national

“With its strong original equipment manu-

and the Just Transition Fund – promoting a

economy.”

facturers (OEMs), automotive supplier

mix of public and private investments.”

2. Antoniu Panait, Manging Director at Vastint Romania

nia over the last nine months but it doesn’t have to be looked at only in light of the

footprint, and IT talent, Romania can and

5. Daniel Rusen, Director of Marketing and Operations at Microsoft

should have a much more prominent role in shaping and participating in the mobility trends of the future.

“Digital transformation is not just about

10. Mihai Boldijar, General Director at Robert Bosch and representative of the Bosch Group in Romania

“Life must go on because we, as humans,

technology. It is closely connected to people

are not trained to be locked into our

and to business leaders’ ability to plan the

homes. The pandemic has affected the

transformation of some business processes

business sector and the inertia that has

within a company. You need a vision and an

worked so far is about to end.

organisational culture to adopt technology

“Romania may benefit less from the

As long as businesses are restrained, jobs

and you need to build digital skills so that

opportunities on the automotive market

and salaries will be cut. As for us, we offer

people are able to use the new processes you

because of its lack of infrastructure and

a framework which is as safe as possible

are trying to implement.”

legal predictability, but these aspects do

for employers and together with them we can take additional measures to improve the safety of the employees in our office buildings.”

not make it impossible for our market to

6. Dragos Mircea Rebegea, Romania Country Manager and Romania & Moldova Head of Sales at Ericsson

create high value-added products and

“The times we’re living in now have proven

11. Rusandra Sandu, Moderator, Partner and Head of the Corporate/M&A Department at Noerr

services.”

3. Ramona Jurubita, President of the Foreign Investors Council

that connectivity is a key element of eco-

“We’re seeing a lot of focus on public

able connectivity which works at very high

“The challenge of attracting FDI and the

investments. We believe that public and

parameters. Digitalization goes hand in hand

importance of promoting and supporting

private investments should go hand in

with connectivity.”

Romania as a safe investment destination

nomic survival. Digitalization cannot be carried out without a strong backbone of reli-

hand, especially when talking about key

are tremendous nowadays. The new reality should be seen as an opportunity to work

investments like infrastructure, digital

7. Rudolf Vizental, CEO and co-founder of ROCA Investments

infrastructure, education, and health.”

“This crisis has brought a change in the con-

fact that we offer plenty of advantages.”

sectors that we need to consider for further

on this more intensely and to highlight the

www.business-review.eu Business Review | November 2020

16 COVER STORY

Local insurance market mounts robust response to pandemic crisis François Coste, General Director of Groupama Asigurari, highlights the way the coronavirus pandemic has challenged the local insurance market and outlines the main changes we will see in the coming period as a result of this complex crisis.

By Anda Sebesi pinpoint the pandemic’s long-term effects on any market or sector, simply because of the level of uncertainty that we are dealing with as the health crisis is still developing. It will be years before any of us will be able to assess the real impact of this crisis.

Challenges also bring about opportunities.

In your opinion, what opportunities are there for the Romanian financial sector, including insurance, during the pandemic?

In my opinion, the acceleration of digitalization is the biggest opportunity for both the Romanian financial sector and the insurance market. The financial sector in particular has made great progress in its digitalization rates, as the restrictive measures imposed by the government led to a significant increase in the use of digital financial services. The pandemic has thus opened the door to endless digital possibilities and a total transformation of the financial sector.

What impact has the pandemic had on the Romanian financial and insurance sectors?

As for the Romanian insurance market,

The current pandemic has caused a lot of

subscribed premiums, with a decrease of 1.9

tunity for Romanian insurers. At Groupama,

problems for many industries and sectors,

percent recorded for Q2 2020 compared to the

we already had several digitalized services,

but the local financial sector is stronger than

same period of last year, but overall the pan-

which have helped us provide clients with

it was in 2008. While it was the very source

demic has not had a drastic negative impact

what they needed in a safe and fast environ-

of the crisis 12 years ago, the financial sec-

on the market.

ment.

tor can now be one of the solutions to the

the COVID-19 pandemic has affected gross

A positive change the COVID-19 pandemic

Digitalization also represents an oppor-

Another opportunity for the Romanian

economic downturn, as it has sound capitali-

has brought on the local insurance market has

insurance market is the increased risk aware-

sation and liquidity rates, which may serve

been an increased awareness of the risks to

ness. I also think that we will see changes

as solid support for all other affected sectors.

which people are exposed, as they have be-

in consumer behaviour. They will demand

The European Solvency 2 rules, which were

come more concerned about health, whether

quicker transactions and will prefer direct

introduced in Romania in 2016 and include a

their own or their loved ones’, so they have

contact with insurance providers through

yearly assessment of risks and their impact on

started to understand the need for insurance.

apps or other digital means. Also, given

each company as well as stress tests to ensure

To this we can add the whole two months we

the changes caused by the pandemic, new

that companies can tackle most shocks, have

all spent inside our homes during the lock-

vulnerabilities that are worth an insurance

been especially helpful.

down, which showed each and every one of

have appeared, for instance those related to

us how important our home is and how much

cybersecurity, losing business data, and so

the pandemic is without precedent because

we need to protect it. These perceptions will

on. Starting from here, insurance companies’

it is generating a double shock: one in terms

certainly have an impact on life and property

portfolios will diversify in the coming period

of demand and the other on the supply side.

insurance rates. However, it is impossible to

to adapt to a new context.

However, the economic crisis caused by

www.business-review.eu Business Review | November 2020

COVER STORY 17

How do you envision the future of the financial sector, considering that the current period is one of profound changes (in terms of both business and consumer behaviour)?

ums amounting to RON 5.6 billion in the first

travel insurance to our portfolio in order to

six months of this year, 3.4 percent above the

better serve our clients as domestic travel

same period of 2019, in spite of the 1.9 percent

rates increased, which also enabled us to

market contraction in Q2.

support local tourism. Groupama Asigurari

In the future, I see a highly digitalized

demic started, apart from protecting both our

subscribed premiums on the life insurance

financial sector that provides its clients with

clients and our employees through a massive

segment in the first half of the year compared

personalised products that respond appro-

work from home programme, was to adapt

to the value recorded in the same period of

priately to their needs. Moreover, as we learn

our products to what our customers needed

2019. Last, the Groupama Group Head Office

from experience, the financial sector of the

in the current context, by deciding to cover

granted its subsidiary in Romania a 10-year

future will be even more robust and able to

risks related to COVID-19 infections, breaking

subordinated loan of EUR 24 million. This is a

face potential challenges and crises even

with the common practice of the global in-

prudent measure that enables us to navigate

better. Furthermore, the insurance sector will

dustry. Moreover, given that we had reached

through the crisis regardless of its overall

be better prepared to deal with unforeseeable

a high level of digitalization even before the

impact on the industry. With this support, we

recovery. Insurance companies are important

pandemic, we were able to quickly adapt

have a solvency rate of 142 percent, which al-

contributors to the stability of the financial

our operations without compromising on

lows us to continue to invest in our offers, our

system, mainly because they support the

the need for social distancing or causing any

technology and operational processes, and

continuity of individuals and companies

inconvenience to our clients. For example,

our team. This demonstrates our trust in the

impacted by the pandemic and also because

claims could be submitted and premiums

Romanian insurance market and its potential.

they are major investors in the financial

could be paid online, and risk inspections for

markets, which fund the state debt and public

all non-life products were performed online,

companies. They also safeguard the finan-

through an app installed on the client’s

What are your plans for the future in Romania?

cial stability of individuals and companies

phone.

We will continue to stay close to our clients

What we did at Groupama after the pan-

also recorded a 33 percent increase in its gross

catastrophic events and react accordingly. A pandemic was probably last on our list of likely risks, but Groupama reacted immediately and was the first insurance company to cover risks associated with COVID-19.

How prepared is the Romanian financial sector to cope with these challenges and what should it do to meet its clients’ ever-changing needs?

Until now, it has been a real support for other sectors in the Romanian economy and will continue to be a pillar in the country’s economic

by helping mitigate their risks. As consumer behaviour is fickle and changes regularly, it is

and adapt to their needs through tailored

How has Groupama performed in this context? Can you provide some figures posted by your company in 2020?

offers and digitalized services. The next

2020 saw Groupama keeping close to its

resolved, so the best leaders will be defined by

How has the local market adapted to the new context? Are you seeing any consolidation on the market?

clients, in a time of uncertainty and fear.

two words: agility and adaptability. Business

Consequently, we managed to come up with

perspectives will be revived for many sectors

tailored offers that responded well to our cus-

when better treatment options are developed

The local insurance market quickly adapted

tomers’ needs. As such, the biggest milestone

for the coronavirus, and especially when the

to the context created by the COVID-19

for us this year was the introduction of COV-

vaccine appears, but that will take months

pandemic, with insurers taking measures to

ID-19 coverage into our life, health, and travel

to be produced and distributed globally. In

protect their clients and employees alike. The

insurance policies, which increased people’s

the meantime, we will continue to anticipate

Romanian insurance market’s results for the

trust in our ability to be there for them during

trends and adapt to them in order to embrace

first half of 2020 were good, with gross premi-

difficult times. Moreover, we added domestic

our clients’ needs.

important to always listen to what consumers have to say and respond with tailored offers.

period will be governed by uncertainties for the whinole world until the health crisis is

www.business-review.eu Business Review | November 2020

18 INTERVIEW

Apa Nova looking to reduce its impact on the environment Andrei Hostiuc, deputy general director at Apa Nova, tells Business Review about the ways in which the company contributes to the circular economy in Romania and its main investments targets on the local market.

By Anda Sebesi time, we monitor the quality of drinking water 24 hours a day and take daily samples from 54 fixed testing points which are distributed throughout Bucharest, each year performing over 6,000 tests through which we monitor 120,000 indicators.

How do Apa Nova’s business practices reflect the principles of sustainability and the circular economy?

Follow-on investments and upgrading the water and sewerage system are strongly based on Apa Nova’s access to the technical and managerial expertise of a world leader in the field of environmental services: Veolia. In today’s circular economy, in order to move from resource consumption to a use-and-recover approach, Veolia designs and implements solutions aimed at improving access to resources while protecting and renewing them and continuously reducing our impact on the environment.

To close the circular economy loop, the Group is enhancing its expertise on ecodesign in order to be able to provide better support to producers from the initial stages of designing their manufacturing processes to producing new materials from processed

What services does Apa Nova currently offer?

its outskirts, under conditions of maximum

waste. We therefore contribute to generat-

safety. Moreover, the company’s daily perfor-

ing new resources as wastewater is returned

Upon signing the Concession Agreement with

mance is thoroughly evaluated based on the

to the natural circuit and waste becomes

the City Hall of Bucharest 20 years ago, in

23 service criteria stipulated in the Conces-

reusable in production processes or is used as

2000, Apa Nova became the concessionaire

sion Agreement, which include technical and

fertiliser in agriculture.

of the public water supply and sewerage ser-

commercial performance indicators.

vices of the Bucharest Municipality. This year,

Apa Nova currently manages 2,508

To sum up, the entire process consists of capturing the water from the Arges and

the agreement was extended for a further 12

kilometres of water pipes, a 2,380-kilometre

Dambovita rivers and guiding it to treat-

years, until 2037.

long sewerage network, three drinking water

ment plants in Arcuda, Rosu, and Crivina for

Two decades ago, Apa Nova commit-

production stations (Rosu, Crivina, Arcuda),

disinfection, filtration, and pH correction

ted itself to offering essential high-quality

7 pumping stations, 37 re-pumping stations,

before it is distributed to homes in Bucharest

services to the inhabitants of Bucharest and

and a treatment plant at Glina. At the same

and surrounding areas which the company

www.business-review.eu November Business Review | May 2016 2020

COVER INTERVIEW STORY 19 14

serves. The water circuit ends at the Glina

ing risk in central and depression areas by

software solutions that can predict and detect

wastewater treatment plant, where we collect

extending the rainwater and household sew-

losses and emergencies or even automate bill-

it then treat it mechanically and biologically

erage network by more than 94 km, adapting

ing and customer interaction processes.

to return it to the natural water circuit. At the

the water infrastructure to current needs and

At the moment, our field teams are

same time, the biogas generated during the

urban development stages by resizing the

equipped with tablets and use a digital tool to

treatment process is used to produce electric-

water distribution system in Bucharest and

automatically take work orders and request

ity and heat.

its surrounding areas – an investment project

the delivery of materials directly to their loca-

that will benefit over 645,000 inhabitants –,

tion. Communication is thus instantaneous

and extending the water and sewerage net-

and downtime has been eliminated.

What is Apa Nova’s contribution to Bucharest’s transformation into a city of the future?

works by 132.8 km and 91.4 km respectively, according to the urban development plan.

Digitalization remains a top priority for us, and so does developing a well-defined digital ecosystem that is receptive to the

Apa Nova will continue its efforts to improve

current needs of the market, to help the

through strategic investments, something

What is Apa Nova’s digitalization strategy for the next 5 years?

that is needed not only in Bucharest, but in

In recent years, Apa Nova has made major

it quickly in order to save resources and be

other major European cities as well. At the

investments in digitalization and will allocate

more efficient. Having undergone a complex

same time, the company has responded and

several million euros to continue and even ac-

business transformation process over the last

will continue to do so immediately and point-

celerate this process. We are talking about the

5 years, Apa Nova is now in the Continuous

edly to all strategic urban and metropolitan

digitalization of processes related to produc-

Improvement stages, which aim to deepen

development project, including of course the

tion, operations, support services, customer

and expand the digitalization of processes

city’s Master Plans for development, financ-

service, and human resources management.

within the company by integrating technol-

Our company has implemented and is

ogy into all operations. This stage involves

the city’s water and sewerage infrastructure

ing applications or digitalization projects.

company evolve, collect data, and analyse

constantly looking for innovative operational

continuously developing and increasing our

2020, Apa Nova has agreed to invest a total

technologies, from applications enabling

teams’ digital skills, which is why we use an

of EUR 367.9 million in four primary strategic

automatic control of water treatment plants,

internal e-learning platform and we have cre-

axes, but mainly in combating the effects of

treatment and pumping processes, smart me-

ated a custom structure dedicated to digital

climate change phenomena: reducing flood-

tering or online water quality monitoring to

transformation.

Through the addendum signed in August

www.business-review.eu Business Review | November 2020

20 CHEMICAL INDUSTRY

Chimcomplex puts Romania on European chemical industry map Chimcomplex president Stefan Vuza sat down with Business Review to talk about the importance of the chemical industry for the Romanian economy and the way it has adapted to the current context to become an even bigger player on the local scene.

By Anda Sebesi are two emblematic and

the region’s sustainable development will en-

strategic chemical plants

sure job stability for Chimcomplex employees

in Romania, and they

and over 5,000 employees from companies

are the only industrial

which are linked to us both horizontally and

platforms with fully Ro-

vertically.

manian capital to have continued operating throughout the transi-

What are the Romanian chemical industry’s financial needs?

tion of the last 30 years.

We need to operate in the same economic

These two platforms are

environment as our major European and

crucial for Romania to

global competitors, which benefit from the

remain a strategic indus-

liberalisation of energy prices, state guaran-

trial player in the region

tees for investments, and access to European

until 2030.

funds. We need access to the EUR 9 billion

Back in 1990, Ro-

the European Commission provides through

mania used to export

the EU 4Health programme, but we need

chemicals worth EUR 34

decision-making and political support in com-

billion per year, and now

petition with other countries that are strongly

it imports EUR 8 bil-

lobbying in Brussels.

lion worth of chemical

Does Romania need new policy for the chemical industry? If so, what should it look like and what would our country stand to gain from this policy?

products every year. The chemical industry

at the same time it has all it needs to become

What are Chimcomplex’s main products and how do they meet the needs of the region and contribute to a higher quality of life?

Yes, because Romania can become part of

one of the biggest growth engines for Roma-

In addition to chlorosodium products, we also

the European value chain. There are Pan-

nia's economy.

produce a wide range of other chemicals.

generates the largest share of the country's foreign trade deficit, with EUR 7 billion, but

The products manufactured by Chimcomplex

European projects and investments that can

are used daily to produce thousands of other

chemical industry has the capacity, the know-

What kind of projects has Chimcomplex developed around the circular economy and energy efficiency?

how, and the ability to develop innovative

We have ambitious projects in the field of

prosthetic limbs, titanium aircraft wings, and

technologies to respond to the challenges we

energy efficiency (photovoltaic energy and

batteries for hybrid cars.

face today and in the future. The Green Deal

100 percent cogeneration on green hydrogen)

Our products are used in several fields,

was designed as a turning point for Europe,

integrated with high performance technologi-

including the automotive, furniture, plastics,

and the chemical industry is ready to support

cal processes (nanotechnology in electrolysis

textiles, sugar, metallurgical, pharmaceuti-

the goals it lays out. The pandemic was one

generating green hydrogen). Our general

cal industries, in the production of bleaching

of the many cases in which we showed that

objective is to continuously improve and raise

agents, soaps, detergents or road defrosting

our sector was resilient and reliable – when

the efficiency of production processes and to

substances, in refining petroleum products,

we pushed our capacity limits to meet the

increase the quality of life in the communities

manufacturing cellulose, purifying free fatty

exponential growth in demand for disinfec-

where we operate, by ensuring well-being,

acids in the oil industry, in water treatment

tants and products used in the development

environmental protection, and economic and

facilities, thermal insulation, and the list can

of protective gear. Oltchim and Chimcomplex

social cohesion. The impact of investments in

continue.

be made to cover demand for products of strategic importance to Europe. Romania's

safer and more durable products: from polyurethane shoe soles and car seat foam to PVC

www.business-review.eu Business Review | November May 2016 2020

GLOBALCOVER INVESTMENT STORY 14 21

Top 4 trends on global investment map and how Romania can react COVID-19 has generated a steep economic decline. As companies face the realities of falling revenues and shrinking profits, understanding new foreign direct investment (FDI) trends is crucial as the UN is predicting a 40 percent drop in FDI levels this year. The big question is: what are the latest trends in FDI and how can Romania adapt to the new reality?

By Claudiu Vrinceanu will depend on how companies balance risk mitigation with cost efficiency, among other factors.

The effect of this phenomenon is predictable for Romania: a vertical integration of agricultural producers towards better processing/industrialisation of their products. In this context, large producers probably already have solid plans and will adapt their strategies to the crisis by reducing costs in production and logistics. It is an opportunity for mediumsized producers to diversify and invest in the food industry (in processing - cheeses, sausages, and in semi-prepared foods).

The Romanian government should accelerate the digitalization of certain marketing services

4. THE RELOCATION OF MANUFACTURING CAPACITY Romania may be able to attract new manu-

1. THE DECLINE OF FDI

body, whose focus should be on scouting for

facturing capacity as the global economy

According to the United Nations’ 2020 World

potential investors, identifying their con-

undergoes major changes in the context

Investment Report, global FDI flows are

cerns, and facilitating their access to support

of the COVID-19 pandemic. According to a

estimated to drop by up to 40 percent this

services offered by local authorities. The

report from Colliers International that looks

year, decreasing well below their value of USD

Romanian government should accelerate the

at the regional industrial market, Romania in

1.54 trillion in 2019. The trend is expected to

digitalization of certain marketing services

particular is noted in the report as a highly

deepen in 2021, with a 5 to 10 percent drop,

and create a new online platform to promote

competitive location, both in terms of costs

and only in 2022 do we expect markets to

Romania. This might be a good way to cope in

and its significant increase in industrial pro-

start recovering.

the post-lockdown recovery. Some good ideas

duction in recent years. It is worth noting that

This crisis may open up a window of opportu-

could include organising virtual site-selection

in Romania, the gap between value added per

nity for Romanian authorities to re-examine

visits to assist in project definition or organis-

employee and labour costs is slightly below

their approach to investment attraction and

ing training for staff and webinars for firms to

that of China, which is also true of neighbour-

retention, with a focus towards increasing the

facilitate e-learning opportunities via existing

ing countries, with some small differences.

integration of FDI within local economies.

platforms. Online surveys could also be con-

But what can Romania do better? Innova-

ducted to better assess the impact the crisis is

tion remains the region’s Achilles’ heel, with

2. THE DIGITALIZATION OF BUSINESS ASSISTANCE SERVICES

having on companies.

Romania scoring far below other European

Many governments and Investment Promo-

3. COMPANIES ARE RETHINKING THEIR SUPPLY CHAINS

competitiveness indicators. However, Roma-

tion Agencies (IPAs) have used creative digital solutions to assist firms in the context of

Companies are also likely to begin rethink-

with EU countries and other developed na-

COVID-19. This could also be the path for In-

ing their supply chains in the medium and

tions over the last couple of decades in terms

vest Romania, our governmental investment

long run and the direction of these changes

of infrastructure and institutional quality.

countries in the World Economic Forum’s nia has managed to significantly close its gap

www.business-review.eu Business Review | November 2020

22 BUSINESS

Going global in the US: why it’s hard for Romanian companies to develop in America Few Romanian tech startups have scaled globally and managed to establish a relevant presence in the United States to achieve the kind of growth they wanted.

Success stories include the well-known UiPath, with offices in New York, Houston, Seattle, and Austin and Typing DNA, headquartered in New York. Based on these two business cases, we might say that founders must relocate to the US to maximise their companies’ success.

It has become very difficult for European companies to develop in the US

M

By Claudiu Vrinceanu

edijobs, a digital platform focused

engineering base as they expand to the US,

on multiple fronts. In January, they hired a

on healthcare recruitment, has

although this would have been part of the

US Sales leader following a search process,

also opened its first office in New

general strategy a decade ago.

according to the Index Ventures study. He

York and plans to consolidate its presence on

The survey of 275 European startups over

had solid experience and ran the US until

the US East Coast. DocProcess, a Romanian

the last 10 years shows that creating US-based

recently, building inside and field sales teams.

technology company with an international

engineering, tech, and R&D teams has fallen

Later, a top Romanian sales rep moved over to

footprint, has launched a new brand position-

out of favour, and they are staying in Europe

support him. Pre-sales was covered through

ing and it is looking to gain new clients in

for longer, taking advantage of the region’s

a lot of travel by the Romanian team. Daniel

the United States. Last but not least, Druid,

much-improved availability of talent and

Dines, the founder and CEO of UiPath, started

a Romanian company that develops chatbot

funding. Even if you have global ambitions

spending four or five months per year in New

technology for large companies, intends to

and the US represents a large share of your

York. “My being in NY wasn’t significant for

expand rapidly in the United States in the

addressable market, you still need to carefully

closing US sales. But it helped for hiring US

context of a new investment round it ob-

pick the right time to build your US presence.

execs,” he said. It is often claimed that a suc-

tained this year.

Index Ventures research into European

cessful US expansion requires the founder

expansions to the US revealed that 59 percent

to relocate, but the reality is more nuanced.

very difficult for European companies to

of startups expanded to the US pre-Series A

According to the Index Ventures survey of

develop in the US, as it has become more ex-

in the period between 2008 and 2014. This

European startups that have expanded to the

pensive and as opportunities in Europe have

dropped to just 33 percent for the 2015-19

US, 46 percent believed that it was critical for

improved. This results in European startups

cohort. So most European founders are now

a founder to move to the States, but in fact,

being much less committed to a US launch.

holding back expansion until after Series A.

only 36 percent of them actually made the

New research suggests that it has become

New research by Index Ventures today reveals

move. Even in the outlier list of European

that less than 1 in 5 (50 out of 275) European

SHIFT TO THE US. CASE STUDY: UIPATH

successes in the US, only 40 percent of found-

tech firms are choosing to relocate their

2017 proved to be a huge year for UiPath,

ing CEOs had moved to the US.

www.business-review.eu Business Review | November May 2016 2020

ENTREPRENEURSHIP COVER STORY 14 23

Opportunities in Romanian entrepreneurship after a pandemic year Even though more than half of Romanian companies are exposed to the crisis generated by the pandemic, we should be optimistic and see what opportunities there may be in the entrepreneurial ecosystem in the coming period. We highlight five reasons for optimism transposed into strong points that can stimulate Romanian entrepreneurship.

By Claudiu Vrinceanu postgraduate students who want to launch a business in Romania can obtain funding of up to EUR 100,000 from European funds.

A MORE DIVERSIFIED STARTUP FUNDING SYSTEM The funding of Romanian startups has become more sustainable and diversified in recent years. The number of investors in Romanian startups and scaleups reached 97 in 2020. The pipeline of local and international ventures is no longer driven by a few small companies in e-commerce and marketplaces, but is rather showing a balanced mix Most early-stage startups are looking to join external incubators and accelerator programmes

of innovative ideas in FinTech, Biometrics, Blockchain, Robotic Process Automation and HR-related solutions. Bucharest is the main

IT TALENT POOL

group (which in the collective perception

hub in Romania, driven by its strong digital

Romania has long been known as home to

tend to not be associated with the idea of a

workforce and diversity.

a large pool of great developer talent – the

startup or with entrepreneurship, although

second largest in Central and Eastern Europe

they are actually successful businesses in the

vestors with only a few local funds being able

(CEE) – with more developers than countries

field of high technologies). Moreover, in the

to participate in Series A+ rounds. Besides

like the Czech Republic and Hungary. Data

context of the COVID-19 crisis, the number

the local funds investing in the ecosystem,

published by the National Institute of Statis-

of professionals with business experience

we are also seeing a growing number of inter-

tics (INS) indicated a number of 140,000 em-

who could become founders will increase

national players scouting the Romanian tech

ployees in the IT industry in Romania, most

as a result of turnarounds and restructuring

market for investment opportunities. Due to

of them located in Bucharest (46 percent),

processes.

the lack of locally-grown venture capital (VC)

Top funding is driven by international in-

funds, most early-stage startups are looking

Cluj (12 percent), Timisoara (9 percent), and

to join external incubators and accelerator

Iasi (6 percent).

HIGH INTENTION FOR YOUTH ENTREPRENEURSHIP

GROWING NUMBER OF ACCELERATORS

The appetite for entrepreneurship is growing

More than 20 accelerators are now operating

among young people in Romania, with half

MORE EU FINANCING PROGRAMMES

in Romania, involving more than 300 start-

of them saying that they want to be entrepre-

The number and value of EU programmes

ups. This also represents a strength for future

neurs according to an Insights study. Their

and sources of finance that can benefit Roma-

founders. According to studies conducted

chosen fields also mark an increased interest

nian SMEs is always growing, and they can

in Romania, successful entrepreneurs tend

in entrepreneurship and management, which

help narrow the innovation and techno-

to launch their startups after the age of 40.

rank first among young people’s preferences.

logy gaps that exist between firms in Roma-

Studies show that the success rate of startups

In this context, a success could come next

nia and other EU countries. In this sense,

founded by people under 30 is half that of

year from the Innotech Student funding pro-

over EUR 313 million are available for start-

startups founded by people in the 50-60 age

gramme, through which undergraduate and

ups and SMEs.

programmes.

www.business-review.eu Business Review | November 2020

24 ENTREPRENEURSHIP

Move to remote work boosts clout of cybersecurity startups With global security spending set to reach USD 123 billion this year, innovative startups have the potential to scale up quickly and provide solutions that can be used by companies of all sizes. As remote work has become the new normal, companies have had to deal with a growing number of challenges related to data security and cyber risks.

By Ovidiu Posirca

T

he Romanian startup ecosystem has been growing in the past few years and some entrepreneurs are starting

to secure capital from foreign funds for faster development.

Funding for cybersecurity startups is set to reach USD 4.5 billion this year, up 11 percent year-on-year, according to CB Insights.

“We’ve seen an increasing number of innovative cybersecurity startups emerging in Romania, including some with whom we’ve been involved at ROCA X. With companies of all sizes becoming increasingly concerned about security, particularly data breaches, demand has grown rapidly. However, adopting any cybersecurity solution involves a serious consideration process for any company. Romanian startups often struggle with managing lengthy sales processes. Since Romanian enterprises tend to lag on digital strategy, selling in Romania can be especially challenging,” Jennifer Austin, senior investment partner at early stage startup investment fund ROCA X, told BR. “On the other hand, we’ve seen several promising cybersecurity startups going global from day one, completely skipping Romania as a target market. Finally, even as we see higher technological sophistication, leveraging artificial intelligence and machine learning, the growing market demand for cybersecurity from SMEs demands that startups reduce complexity for users and make security more accessible and easy to manage,” she adds.

Cybersecurity spending will continue to grow, being forecast to reach over USD 248 Global cybersecurity spending is set to reach over USD 248 billion by 2023

billion by 2023, according to MarketsandMarkets.

www.business-review.eu Business Review | November May 2016 2020

“You know that curve of exponential

ENTREPRENEURSHIP COVER STORY 14 25

Cyscale, a developer of cloud-based data

securing their assets with automated patch

growth we keep seeing for how coronavi-

security solutions, tapped SeedBlink inves-

management, antivirus, and antimalware

rus will spread — the same curve goes for

tors and secured EUR 350,000. Its service

offerings, reached a valuation of USD 2 billion

cyber risks,” said Camille Charaudeau, vice

can be integrated into major cloud platforms

at the end of 2019. Startup KnowBe4 expects

president of product strategy at Paris-based

and can warn users of any vulnerabilities or

its valuation to double to over USD 2 billion if

CybelAngel, quoted by sifted.eu.

data loss risks. Elsewhere, TypingDNA got

its plans to go public are successful. The firm

EUR 6.2 million in a Series A funding from

got USD 300 million in a direct investment

Specialists say the market is fragmented, so there are numerous opportunities for

Gapminder,

providers of all sizes and startups have the

Gradient

potential to grow fast. The technology is

Ventures

powerful enough to provide the same level of

(Google’s

cybersecurity regardless of whether em-

AI venture

ployees are at their office desks or working

fund), and

remotely.

Techstars

The field is ripe for innovation and dy-

Ventures.

namic startups can come up with new prod-

The startup

ucts or services that can efficiently improve

offers an au-

the digital safety of a growing community of

thentication

remote workers.

technology

“While adjusting investment processes to

called typ-

a remote work environment, capital in cyber-

ing biomet-

security is both available and being deployed.

rics based

This points to resilience in the cybersecurity

on how a

investment landscape in the face of economic

person uses

headwinds,” according to a DataTribe report.

a keyboard,

Investments in cybersecurity are needed to

replacing

ensure the continuity of business and con-

the tradi-

sumer protection.

tional password system.

from KKR group. Its solution aims to remove

An EUR 800,000 seed funding round

LOCAL STARTUPS HAVE ROOM TO GROW A handful of Romanian startups have raised additional funding this year despite the challenges posed by the health crisis.

For instance, Se-

was secured by CODA Intelligence, a startup developing a cybersecurity platform for small and medium-sized enter-

threats like phishing, ransomware, and other forms of social engineering that can impact companies in various industries. In short, the startup platform allows a company’s security

prises. Its solution draws

staff to send out tests to employees. This

up a company’s dy-

could include harmless phishing attempts

namic security footprint based on its

that employees would need to report.

Cloud security provider Netskope reached

daily data flows.

a valuation of nearly USD 3 billion after it

developing AI

The startup was

got USD 340 million in fresh funding. The

video analysis

backed by Early

startup provides real-time protection against

solutions for

Game Ventures,

network and data threats on cloud services,

surveillance

ROCA X, and

websites, and private apps.

or monitoring

angel investor

curifAI, a startup

cameras, got EUR

Marius Alexe for

225,000 through

this funding stage.

CYBER UNICORNS

platform. The company’s

In the past year, several

tools can detect unusual

cybersecurity startups have

events, while also recognising a

data protection and management whose valuation topped USD 1 billion. It developed a SaaS solution that helps companies stream-

SeedBlink, a local equity crowdfunding

Druva is another startup focusing on cloud

secured funding that has propelled

line their security operations by removing the need for unnecessary hardware, capacity planning, and software management.

Snyk also joined the unicorn club after

person’s face and facial expressions. This

their valuations above USD 1 billion, thus

receiving USD 150 million in a new funding

comes in handy for the security of commer-

enabling them to join the so-called “unicorn

round. The startup helps software developers

cial spaces or for marketing-related activities

club”. Kaseya, whose platform monitors and

identify and patch security vulnerabilities in

in stores.

manages companies’ IT infrastructures while

open source programmes.

www.business-review.eu Business Review | November 2020

26 ENTREPRENEURSHIP

Local startups embark on EU Green Deal mega-project The circular economy is an emerging sector that supports startups creating new models that recycle and reuse materials in supply chains and consumer industries. We’re seeing such entrepreneurial initiatives appearing locally as well, and their development will only accelerate as the European Union needs around EUR 7 trillion worth of investments to become climate-neutral by 2050 under the Green Deal.

By Ovidiu Posirca

EU: The transition to a more sustainable economy is critical as annual waste generation is projected to increase by 70 percent by 2050

T

he sector is ripe for innovation, with

Startups are encouraged to build innovative

technologies, says the EU in its circular

the EU estimating that some 700,000

solutions based on closer relationships with

economy action plan.

new jobs could be created by 2030

customers, mass customisation, a shared and

by applying circular economy principles.

collaborative economy, all powered by digital

Eliminating net greenhouse gas emissions by 2050 will need public and private invest-

www.business-review.eu Business Review | November May 2016 2020

ENTREPRENEURSHIP COVER STORY 14 27

ments of EUR 3 trillion in utilities to build

lar principles only apply to non-profits and

In Denmark, Too Good To Go has raised

renewable energy assets and upgrade power

not to sustainable and profitable ventures.

EUR 16 million to expand its platform that

grids, according to Goldman Sachs.

(…) It will all evolve and improve the more

allows people to buy surplus, unsold food

people are be able to share, to reuse, to

from restaurants or supermarkets that would

STARTUPS CREATING GREEN JOBS

reinvent, and even to pay more for a greater

otherwise have to be thrown out. The startup

Companies’ sustainability strategies will also

societal good,” he adds.

is on track to save 20 million meals per year,

be integrated in this joint effort carried out in

The EU says that the circular economy

according to eu-startups.com.

the EU. Entrepreneurs can also play a key role

can work in key value chains ranging from

Worn Again has developed a polymer

in building the economy of the future.

electronics and IT to batteries, textiles, and

recycling technology that can convert worn

construction.

clothes, as well as plastic bottles and packag-

“Without Romanian entrepreneurship,

The transition to a more sustainable

ing, into raw materials. The startup got GBP 5

will be much slower. It should be our respon-

economy is critical as global consumption

million in funding from fashion retailer H&M

sibility as entrepreneurs and foreign inves-

of materials such as biomass, fossil fuels,

to develop the initiative.

our move towards Sustainability 2.0 or 3.0

tors to support local education and startups,” said Ionut Georgescu, founder & co-CEO of FWEI, during BR’s Foreign Investors Summit 2020.

PolyMore is one startup founded by a team of students in Timisoara that uses artificial intelligence to optimise the management of plastic waste. Their technology primarily focuses on industrial waste and plastics used in electronics.

Elsewhere, ECOTREE raised EUR 225,000 through equity crowdfunding on SeedBlink.

The startup is building a digital platform aiming to streamline the monetisation of waste recycling considering that Romania only recycles 13 percent of waste it produces.

By early 2020, Evertoys Romania had

metals, and minerals is expected to double

In Barcelona, Re-circula Solutions de-

raised USD 331,300 for its toys-as-a-service

over the next forty years, while annual waste

veloped a digital waste management and

project. Its business model is based on the

generation is projected to increase by 70

collection system for urban areas and phar-

growing trend of sharing economy and recur-

percent by 2050, according to the action plan

maceutical waste. The startup aims to cut the

rent income, targeting medium and high-

published by the EU.

amount of waste produced in Europe, nearly 35 percent of which ends up incinerated or in

income urban families with children aged 1

EUROPEAN STARTUP IDEAS DISRUPTING CIRCULAR ECONOMY

landfills.

leasing platform for companies and indi-

Across Europe, there are numerous startups

EUR 1.5 million in EU funding to track plas-

vidual users. Following an initial investment

which are building new models that can be

tics from initial resin to end-product. Data on

of EUR 75,000, the startup generates revenue

easily integrated into the circular economy.

plastics coming from QR codes or chemical

to 14.

Meanwhile, Lizit has created a gadget

from subscriptions paid by users and the sale of gadgets at the end of their usage cycle.

London-based Aeropowder is developing new materials from surplus feathers, which

Dutch blockchain startup Circularise got

tracers are fed into the blockchain.

The EU is becoming a key backer of these

are among the lightest natural fibers and

startups as it has a budget of EUR 150 billion

circular economy companies hold an insig-

efficient thermal insulators. It has already

for circular economy projects. The invest-

nificant share of total business activity. How-

launched the first thermal packaging material

ments contribute to new business models,

ever, circular principles are being adopted

made from surplus feathers that can replace

increased recycling, energy efficiency, and

by big players in various industries who

conventional polystyrene.

the creation of green jobs.

“With the exception of a few examples,

Going forward, the European Commis-

are willing to reinvent themselves, eager to

Having raised EUR 2.9 million to date,

meet their customers’ expectations or being

Sulapac is a Helsinki-based startup that cre-

sion, the executive arm of the EU, will sup-

pushed by new regulation,” Matei Dumitres-

ated a biodegradable alternative to plastic.

port the creation of pan-European clusters in

cu, senior investment partner at ROCA X, an

Their product can be processed with existing

sectors deemed to be priorities, including the

early-stage startup investment fund, told BR.

plastic manufacturing machinery, which can

circular economy and advanced manufactur-

boost adoption rates.

ing.

“The common mindset here is that circu-

www.business-review.eu Business Review | November 2020

28 MACROECONOMY

United States getting more involved in Romania’s economy For the first time, the United States are signalling increased interest in the economic framework of the CEE region. Poland and Romania are prime targets, as the US already has significant military presence in the two countries.

By Sorin Melenciuc with the United States of America, in terms of the energy component as well as our cooperation in the civil nuclear field. As promised, we have fulfilled a strategic mission: identifying partners among NATO members for the third and fourth units at Cernavoda,” Economy minister Virgil Popescu said.

STRATEGIC INFRASTRUCTURE Infrastructure is another key component of the agreement. During the same official visit by the Romanian government delegation in Washington, Foreign Affairs minister Bogdan Aurescu had a discussion with US Secretary of State Mike Pompeo regarding the importance of the two major regional interconnection projects: Rail-2-Sea and Via Carpatia, backed by the United States and promoted by Romania, including within the Three Seas Initiative.

Rail-2-Sea, a railroad project, aims to connect the Black Sea port of Constanta and the Cernavoda nuclear power plant attracted American funds earlier this year

Baltic Sea port of Gdansk by improving the rail connection through upgrades of existing infrastructure or the construction of new

MAJOR NUCLEAR ENERGY PROJECT

project, which will also involve Romanian,

In October, the Romanian government signed

Canadian, and French companies.

its first major economic agreements with Washington: American money will finance the construction of units 3 and 4 at the Cer-

The draft agreement has already been sent to the European Commission for approval.

This first project is paralleled by another

links.

The other project – a motorway from Lithuania to Greece with a large section passing through Romania – is even more ambitious and requires a huge investment. It is not

navoda nuclear power plant and the refur-

agreement with the US Exim Bank, which

clear whether the US will be involved in these

bishment of unit 1.

could agree to a USD 7 billion financing pack-

projects financially as much of the infrastruc-

It is a large project for Eastern Europe, as

age for the Cernavoda investment, but also

ture is not on the map of the EU’s top mobility

it implies an USD 8 billion investment which

to other energy and infrastructure projects

corridors. However, these projects have a

will be financed through a US-led scheme.

including LNG, gas deposits, roads, and

direct strategic impact, including on military

railroads. The importance of the project,

mobility, on NATO’s eastern flank.

According to a draft intergovernmental cooperation agreement signed on October 9 in

which will use the same Canadian CANDU

Washington by Romanian Economy minister

6 technology as for the first two units, was

Foreign Affairs minister Bogdan Aurescu

Virgil Popescu and US Energy Secretary Dan

highlighted by the Romanian government.

urged the US to involved in the implementa-

Brouillette, AECOM – an American construction and engineering company – will lead the

“Today, Romania is taking a huge step forward in developing its strategic partnership

During his visit to Washington, Romanian

tion of these projects, including financially, stressing the need for a strong US economic

www.business-review.eu Business Review | November May 2016 2020

MACROECONOMY COVER STORY 29 14

and investment presence to grow along with

local businesses in key sectors like banking or

its enhanced military presence in the region.

pharmaceuticals.

The minister also highlighted Romania's

In June 2018, Piraeus Bank Romania was

This year, Romania was ranked among the 30 most favourable markets for US tech firms, based on a wide range of factors, including

efforts to strengthen interconnectivity be-

acquired by JCF IV Tiger Holdings, an entity

the availability of skills, complexity of the

tween northern and southern Central Europe,

belonging to American fund J.C. Flowers. The

regulatory landscape, quality of connectivity

as a strategic objective in the process of re-

bank’s new shareholders changed its name

and infrastructure, GDP growth, and inward

covering and increasing the European Union’s

to First Bank and it now proudly advertises

investment by Velocity Global in its Global

economic resilience.

itself as an American lender. This was the

Expansion Tech Index.

the fund’s first investment on the Romanian

KEEPING CHINESE INTERESTS OUT This fresh and unexpected American interest

market and in Central and Eastern Europe.

Another major US investment in Ro-

in the region could be associated with the

mania was the acquisition of

current US-China trade war.

generic drugs producer Zentiva

In fact, prior to the Romanian-American

of the largest US private equity

navoda, an older agreement with a Chinese

investors.

Zentiva has a strong presence

company Nuclearelectrica as a result of pres-

in Romania, where it owns one

sures from its main shareholder, the Econo-

of the biggest pharmaceutical

my Ministry.

manufacturers – Zentiva SA,

But this was part of a larger plan. Two

Americans have two major military bases in

by Advent International, one

agreement to build the two units at Cerpartner had been cancelled by state-owned

FOLLOW THE FLAG EFFECT?

formerly known as the Sicomed

other sectors are also involved in this war

factory. Following the acquisi-

and influenced by the US-Romania strategic

tion, also completed in 2018, this

partnership and the US-China long-term geo-

factory is now owned by a major

political rivalry: 5G networks, with Huawei

US investor. At the same time,

almost excluded from the planned tender in

US e-commerce giant Amazon

Romania, and infrastructure, with Chinese

opened a large development

firms losing one contract after another.

centre in Bucharest, employing 1,300 people.

Romania, in Deveselu – hosting the US Aegis

This was Amazon’s second – but also larg-

Ballistic Missile Defense System – and at

partnership, which has mainly been based

est – development centre in Romania, after

Mihail Kogalniceanu airport. However, until

on military aspects, seemed boosted last year

it opened the first in Iasi, the biggest city in

recently, American businesses and money

when Romanian president Klaus Iohannis

Romania’s historic Moldova province. Ameri-

hadn’t really followed US troops in Romania.

had a meeting with US president Donald

can firms already have a strong presence in

Trump at the White House. The discussion

Romania as the country is known for its well-

military and economic interests in the US’s

was focused on ways to advance and expand

educated IT specialists.

geopolitical thinking. The study “Following

The 23-year-old US-Romania strategic

the two countries’ strategic partnership. At

Oracle runs its biggest European centre in

Some experts have already associated

the Flag: Troop Deployment and US Foreign

the end of the meeting, Klaus Iohannis and

Romania, employing more than 4,500 people

Direct Investment,” written by Glen Biglaiser

Donald Trump made a joint statement.

across its local businesses, including IT and

and Karl DeRouen Jr., finds that security

support services. Another US tech giant, IBM,

factors can impact FDI in two stages: the

orandum of Agreement was signed by the two

has more than 3,000 employees in Romania,

initial decision over whether to invest and

governments regarding 5G technology, “tak-

where it has been operating since 1995. Last

the second stage, which refers to the amount

ing into account the importance of securing

year, IBM’s business in Romania exceeded

invested.

the fifth generation wireless communication

USD 200 million in turnover and the group

networks in order to ensure prosperity, as

is planning to expand further. IBM is also

that follow the flag factors are influential both

well as national security,” said a press release

looking to open a European and National

in the selection phase and in the main equa-

by the Romanian presidency.

Romanian Innovation Cognitive Hub to focus

tion for US investors. However, such results

on the development of advanced cognitive

are not found for global investors, suggesting

OTHER INVESTMENTS

technologies. Microsoft is also present in

that positive links between economic and

However, investment from the US is quite im-

Romania through support and development

security goals only hold for US firms,” the

portant in Romania and has gained some mo-

centres in Bucharest and Timisoara, and

study says.

mentum over the past few years. Since 2018,

these businesses are increasing every year as

US companies have increased their presence

demand for such services is rapidly growing

experiences in several countries, “it appears

in Romania, following several takeovers of

on the global market.

that US FDI follows the flag.”

More importantly, during the visit, a Mem-

“Our results indicate a selection effect and

According to the authors, based on past

www.business-review.eu Business Review | November 2020

30 TECHNOLOGY

Pandemic accelerating labour market transformation By 2025, across 15 industries and 26 economies, there may be 97 million new roles that will be better adapted to the new division of labour between humans, machines, and algorithms, according to data gathered by LinkedIn, Coursera, and the World Economic Forum in the 2020 Future of Jobs Report. However, job disruption will be counterbalanced by job creation in new fields, researchers predict: the jobs of tomorrow.

By Romanita Oprea adoption of new technologies and increasing demand for new products and services.

But they also showcase the continuing importance of human interaction in the new economy through roles in marketing, sales, content production, and other positions that require "soft" communication skills.

At a time when working from home has become a necessity, workers are increasingly looking to learn personal development and self-management skills, Coursera found.

Furthermore, tapping into that necessity, universities are opening up their curricula and offering free courses to people who are interested in being better at their jobs, acquiring new skills or even changing their jobs completely to adapt to the new reality.

According to the research, the top skills of 2020 include writing, strategy, mindfulness, Data and AI, product development and cloud computing are some of the emerging professions

"

meditation, gratitude, kindness, listening, and grammar. This is in clear contrast to the

Over the coming decade, a non-negligi-

off" and tend to recruit people with very

more technical skills that were in focus in

ble share of newly created jobs will be

specific skillsets. More than 70 percent of

2019, such as Python coding, artificial neural

in wholly new occupations or existing

those moving into the product development,

networks, algorithms, regression or deep

occupations undergoing significant transfor-

data and AI clusters come from different job

learning.

mations in terms of their content and skills

families; but figures for the engineering and

requirements," the report reads.

people and culture segments are signifi-

RESKILLING AND THE AI REVOLUTION

cantly lower, with 19 percent and 26 percent

In this context, The World Economic Forum

respectively.

has launched a new initiative, called the

Demand is growing for roles like data analysts and scientists, AI and machine learning specialists, robotics engineers, software and application developers, and digital trans-

Reskilling Revolution, a coordinated multistakeholder effort to provide training and

formation experts. Some of these emerging

NEW TECHNOLOGIES AND UNLEASHED HUMAN POTENTIAL

professions will be easier to break into than

According to data gathered by Coursera, it's

2030. A third of all global jobs will be trans-

others. These include data and AI, product

common for individuals moving into data

formed by technology over the next 10 years.

development, and cloud computing, where

and AI to lack key data science skills, but

The United States, France, Russia, India, the

transitions "do not require a full skill match

that it's possible to master those skills, such

United Arab Emirates, Pakistan, and Brazil

between the source and destination occupa-

as statistical programming, within a recom-

were among the first countries to join the

tion," according to the report. But some job

mended time frame of around 76 days of

World Economic Forum initiative, whose

clusters of tomorrow remain more "closed

learning. The jobs of tomorrow reflect the

main purpose is to build social cohesion and

development to reskill 1 billion people by

www.business-review.eu November Business Review | May 2016 2020

COVER TECHNOLOGY STORY 31 14

ensure that people have pathways to social

working towards automating repetitive jobs

mobility. At the same time, the 2020 Global

through algorithms that could complete ad-

Talent Competitiveness Index shows that to

ministrative tasks, robots that can streamline

(ILO) projects that by the second quarter of

succeed in the age of AI, more investment

manufacturing and drones that can deliver

2020, the equivalent of 195 million work-

is needed in skill development and lifelong

goods, researchers are now backing them

ers will have been displaced and as jobs are

learning. While emerging markets are lagging

up after having found out that this kind of

transformed at a greater speed. One of the

far behind talent-rich nations, the gap can be

automation is more quickly adopted during

central findings of the 2018 Future of Jobs

bridged with the right set of policies. “To stay

economic downturns. All companies are go-

Report continues to hold—by 2025 the aver-

at the forefront of talent development, coun-

ing to make a push towards becoming more

age estimated time spent by humans and

tries and cities all around the world need to

digital and therefore more automated.

machines at work will be at parity based on

focus on reskilling their workforces to deal

As seen in the World Economic Forum’s

in five expect to do so permanently.

The International Labour Organization

today's tasks. Algorithms and machines will

with the new environment. They will have

report, eighty-four percent of employers

be primarily focused on data processing and

to emphasise the importance of STEM (Sci-

are set to rapidly digitalize their working

retrieval, administrative tasks, and some as-

ence, Technology, Engineering, Mathemat-

processes, including a significant expan-

pects of traditional manual labour. The tasks

ics) subjects and embrace lifelong learning.

sion of remote work—with the potential

where humans are expected to retain their

humans and AI machines. In the future,

to move 44 percent of their workforce to

comparative advantage include managing,

people and technology will combine to cre-

operate remotely. To address concerns about

advising, decision-making, reasoning, com-

ate economic prosperity and to that end, we

productivity and well-being, about one-third

municating, and interacting.

need to prepare our workforces for this new

of all employers expect to also take steps to

reality,” commented Alain Dehaze, CEO of

create a sense of community, connection,

year are similar to those in the 2018 survey,

The Adecco Group.

and belonging among employees through

jobs such as process automation specialists,

digital tools and to tackle the well-being

information security analysts, and Internet of

ganization (ILO), real unemployment figures

challenges posed by the shift to remote work.

Things specialists are newly emerging among

jumped to an average of 6.6 percent in the

New data from the Future of Jobs Survey

a cohort of roles seeing growing demand

second quarter of 2020. The OECD predicts

suggests that an average of 15 percent of a

from employers. Moreover, a set of roles

that those figures could peak at 12.6 percent

company’s workforce is at risk of disruption

are distinctively emerging within specific

by the end of 2020 and could still stand at 8.9

until 2025, and around 6 percent of workers

industries, including: materials engineers

percent by the end of 2021.

are expected to be fully displaced.

in the automotive sector, e-commerce and

Vocational training will play a vital role in equipping individuals, and the workforce as a whole, with the right capabilities. Governments will need to reduce barriers to and companies to invest into the re-skilling and upskilling of existing workers.

Skills development will need to include human-centred skills such as empathy, creativity, imagination, and leadership, as well as fusion skills that will be essential for collaboration between

According to the International Labour Or-

An IMF analysis has estimated that 97.3

Among the business leaders surveyed,

Although the most in-demand roles this

social media specialists in the consumer

million individuals, or roughly 15 percent of

just over 80 percent reported that they

sector, renewable energy engineers in the

the workforce in the 35 countries included

were accelerating automation in their work

energy sector, fintech engineers in financial

in its analysis, are classified as being at high

processes and expanding their use of remote

services, biologists and geneticists in health

risk of being furloughed or made redundant

work. A significant 50 percent also indicated

and healthcare, as well as remote sensing

in the current context. At the same time, the

that they were set to accelerate job automa-

scientists and technicians in mining and

coronavirus pandemic has heightened fears

tion in their companies. In addition, more

metals. The nature of these roles reflects the

that automation will replace people’s jobs.

than one-quarter of employers expect to

trajectory of innovation and growth across

If for some years now companies have been

temporarily reduce their workforce, and one

multiple industries.

www.business-review.eu Business Review | November 2020

32 MARKETING

Claiming the Purpose Marketing card Internationally-recognised purpose pioneer Thomas Kolster takes a hatchet to his earlier beliefs and warns brands about purpose in his latest book, “Hero Trap”. “Try to fly like a superman, and you will come down like a tin of soup,” he says. BR talked to several specialists and found out what they thought about purpose marketing and the best ways to win in today’s competitive market.

By Romanita Oprea

A

Andrei Dumitrascu, Secom

ccording to Thomas Kolster, most

Consumers nowadays are increasingly

Sorina Mihai, Porter Novelli not just through their high-quality products,

brands today are firmly on the social

reluctant to brand messages, as they’ve

but also through education, promoting the

and environmental issues bandwag-

become irrelevant and superficial, com-

concept of integrative medicine. “We are con-

on like bees around a honey pot, from ocean

municating in the same patterns as they did

stantly listening to our consumers’ needs in

plastic to diversity. People are increasingly

years ago. “To be heard by consumers today,

terms of a healthy lifestyle and we’re taking

distrustful towards these efforts, which are

brands must prove a true interest in their

actions based on these insights. This is how

viewed as cheap marketing stunts meant to

needs and lifestyles and bring forward, in a

projects like the Integrative Medicine Clinic

wow people into buying more. Drawing on

clear sentence, the answer to a basic ques-

or Perspective magazine came to life, that’s

top-line marketing case studies and in-depth

tion: why. Why should I buy you? Have you

why we’re offering specialised consulting

interviews with the likes of P&G’s CMO Marc

thought about the purpose your brand should

in our 13 own stores and last but not least,

Pritchard, Kolster demonstrates how people

play in my life? If there is no clear purpose in

why we provide the most complex product

are truly motivated to act when they’re in

a brand’s mindset, then you are not trustwor-

portfolio on the market. The latest approach

charge of their own life and happiness. One

thy, and you will be ignored,” argues Andrei

of our purpose was done by creating our own

commissioned study comparing well-known

Dumitrascu, marketing & communication

brand, Good Routine, built from scratch and

commercials showed that by taking a people-

director at Secom, a brand that according to

animated by our strong know-how of both

first approach, people were 29.5 percent more

its representatives has a clear mission: to im-

scientific formulas and consumer needs,”

motivated to act on the messaging than they

prove people’s quality of life. They have been

said Dumitrascu. According to Sorina Mihai,

were with the traditional purpose approach.

pursuing this mission for the last 17 years,

managing partner at Porter Novelli Romania,

www.business-review.eu Business Review | November May 2016 2020

COVER MARKETING STORY 33 14

when we talk about our work, most of us

more relevant and powerful. It is also part

rights, public health, and social and racial

refer to it as our passion – doing what we're

of a natural evolution of marketing; promot-

inequality. “In my opinion, the pandemic

passionate about. And she thinks that pas-

ing a product’s virtues was replaced by a

created more opportunities for companies to

sion springs from two sources: interest and

focus on the customer’s needs and now, by

recognise their purpose and publicly commit

purpose. While our interests are more self-

connecting with the customer’s values in a

to it,” she explained.

oriented, therefore easier to identify, purpose

meaningful way.

– our intention and effort to contribute to the well-being of others – is other-centred.

Moreover, as the Secom representative

“I will not be popular for saying this, but it’s just business. It is all connected. It is all

points out, it is all about common sense – at least it should be so. “When your brand is

“Seeking and finding

about generating the

true to itself in every way, has a clear vision

purpose is not an easy

best ROI and now the

and purpose and all its actions are on the

task, but at the other

consumer wants brands

same path, everybody will notice. On the

end of our resolution

that are purpose-driv-

other hand, if you try to have everything by

there's always some-

en. We, as consumers,

doing everything, then your brand will lose

thing bigger than our-

want to connect on a

its identity, and therefore its purpose. And

selves. Ultimately, our

higher level with the

everyone will notice that, too. So, when the

efforts pay dividends

brands and the best

brand’s look, feel, and discourse are all built

to other people, to our

way to do so is through

around the same purpose, then I believe it

community. Recent

emotions and common

would be a good time to claim this,” Andrei

events unfolded a wor-

interests, and purpose

Dumitrascu added.

risome reality – one

provides both. Purpose

that we're all sharing,

Marketing is the exten-

that the pandemic was clearly a catalyst for

globally. We can relate

sion of Content Mar-

the rise of purpose marketing. In her point

to the struggles of

keting, and it has the

of view, although there have always been

people at the other end

ability to create content

companies that had it at the core of their

of the world because we

that consumers want to

strategies, the pandemic made it clearer that

However, Cristina Blanaru is convinced

too are going through something similar. We

spend time on. So the choice is simple: you

brands that support causes the customers

are witnessing the changes and challenges

either have a great backstory you can tell or

care about are not only doing the right thing,

the world is facing and we understand the

you have a great purpose, and it’s even better

but will also receive the approval of the wider

urgency of putting our resources to good

if you have both,” argued Anders Holmberg

public and, as a consequence, have a higher

use,” she explains. Therefore, brands and

Lange, gamification strategist, senior market-

number of customers. “The pandemic has

companies are building purpose-centric

ing advisor, and start-up

shown us that the world

cultures, a paradigm shift to which Porter

mentor at Venture Cup

is unsafe, and we have

Novelli committed from the very beginning.

Denmark.

to change our lifestyles.

In fact, Porter Novelli is a founding member

But one must

But it is not telling us

of the Brands for Good consortium, it has a

wonder: how much

that the change has to

wide network of sustainability and commu-

of the success comes

be towards sustainable

nications leaders, and brings over 25 years

from purpose market-

living; that is just your

of research and insights about purpose,

ing versus the recent

mind playing tricks.

brand, social impact, and issues. We have a

developments caused

The sustainability trend

fully-integrated sustainability consultancy

by the pandemic, other

we’re seeing is a mat-

and communications practice, allowing us to

trends or the normal

ter of survival, as the

seamlessly and efficiently service our clients.

flow of business? Ac-

next generation wants

cording to Sorina Mihai,

children and wants

Cristina Blanaru, founder at Code Name &

the pandemic may have

them to be born into a

AdHugger.net and strategic advisor to inter-

"forced" some brands to

livable world. The big

national and local companies, said that pur-

shift gears and switch

trends are Spaceflight

pose marketing is just the latest lens being

lanes, but it's important

used by companies to reach their customers.

to acknowledge that purpose has been at the

– they are a call for survival. This will not

It started getting popular after advertisers

core of businesses – whether big or small –

change anytime soon, because it is direly

realised that spending marketing budgets on

for a long time now. For decades, passionate

needed. Business will always flow wherever

“noise” was not generating value nor sales in

teams of people have served as drivers of

the money and the consumers are, and that is

the long term, whilst connecting with audi-

change and have positively impacted issues

way in which new business models come to

ences on causes both parties believed in was

such as education, climate change, human

light,” stated Anders Holmberg Lange.

Sticking to consultants’ perspectives,

and sustainable living

www.business-review.eu Business Review | November 2020

www.business-review.eu

34 FOOD TRENDS Business Review | May 2016

COVER STORY 14

Food trends: Romanian farmers’ markets turning into sustainable businesses One of this year’s defining food trends in Romania is related to the farmers’ market, a popular way to get seasonal fresh food from local producers, but new technologies and investments have changed this game a bit. From online seasonal food shopping to certified products and new high standard places to buy products, this food sector is constantly improving.

By Oana Vasiliu

Food shopping changed radically since the new coronavirus pandemic

W

ith more time at home and a

fruits and vegetables during the pandemic.

farmers’ market was reopened, with an

lockdown that kind of forced us

The isolation measures imposed to limit the

impressive facelift which cost EUR 10 million.

to cook – or at least try to –, local

spread of the coronavirus made Romanians

The new market looks fantastic and has all

products have gained more ground. Both on-

go back into their own kitchens, with 92

modern facilities, including air conditioning

line and offline, people are more concerned

percent of respondents saying they preferred

systems. 80 percent of it is meant to accom-

about the origin of their food and its produc-

home cooking while 20 percent chose to order

modate local producers from nearby farms to

tion process. Though online food shopping is

their meals. The crisis also raised Romanians’

sell their produce here, while the cost of rent-

still quite limited, figures are increasing every

interested in baking bread, cakes, and pies at

ing a booth is the same as it was a year and a

year.

home (31 percent).

half ago, before the refurbishment. the Romanians’ Market (Piata Romanilor)

brands Rama and Becel – found that over

A NEW FARMERS’ MARKET AND OTHER HUGE INVESTMENTS

40 percent of Romanians had eaten more

At the beginning of August, the Piata Sudului

local, traditional, and certified organic prod-

After the lockdown, in May, a study commissioned by Upfield – producer of margarine

Last month, a new farmers’ market called opened in Bucharest’s District 2, offering only

www.business-review.eu Business Review | November 2020

FOOD TRENDS 35

New Piata Sudului market

New market dedicated exclusively to Romanian certified bio products

ucts. “The traditional products are certified

they developed five food hubs that connect

by the Agriculture Ministry, while the organic

farmers and small local businesses to urban

ones are certified by companies authorised by

consumers. The food hubs are located in

the Ministry, so the state guarantees the qual-

Bucovina, Cluj, Brasov, Iasi, and Odorheiul

ity of the products sold at this market. It is the

Secuiesc and they contribute to maintaining a

first such initiative I know of, and I’ve been

local agricultural and gastronomic culture, to

working in this field for many years,” Marian

preserving tradition, reconnecting urban and

Cioceanu, the president of the Association of

rural areas, and promoting a healthy lifestyle.

Organic Agriculture Operators in Romania, told us in a Facebook message.

Asked by Business Review about the typical food hub customer, Oleg Moraru, the coordinator of the RAF programme, explained

MORE ONLINE BUYING

that “most food hub customers are people

Plenty of fresh food can be bought online,

between 25 and 45 years old and married,

even from the largest retailers in Romania,

especially women. Also, in the last 2 years,

many of whom have recently launched their

some food hubs have managed to develop

own delivery systems or signed partner-

the B2B sales channel that allows companies

ships with existing delivery services. People

with more than 100 employees to contract

have also organised across several Facebook

‘standard packages’ for employees by offering

groups or websites themed around fresh,

them gifts for their birthdays or holidays like

local food. For example, Taraba Virtuala is

Christmas, New Year, Easter, Children's Day,

an online platform and app connecting local

etc.”

producers with people interested in buying

Goodies from one of Romania's food hubs

Even before the pandemic broke out, the

locally. The app is very user-friendly, allowing

share of online orders from these food hubs

users to easily locate producers in their area

was quite high, especially in the case of hubs

and find a variety of products: baked goods,

that had assured distribution nationwide and

fruits and vegetables, honey and jams, dairy

carried out frequent marketing campaigns to

and food hubs products and manufacturers

products, pickles, cold meats, and sweets.

promote their products. Since March 2020,

have all the approvals and authorisations

when the lockdown was introduced, the

required for production and sale. Their main

number of online applications has increased

concern is to ensure the rapid distribution of

by over 400 percent, Oleg Moraru added.

products, the high quality of these products,

FOOD HUBS BECOME HEALTHY SHOPPING OPTION Since 2017, The Romanian American Founda-

Another particularity of these food hubs

Ordering groceries online from small farmers are the new big thing

and a greater diversification to encourage

tion (RAF) has been creating food hubs in

are the relatively small distances from the

and further increase the trend of ordering

Romania through a programme they finance

points of production because the concept

online from local products. In addition, they

themselves. The RAF programme for devel-

states that all these products should reach

develop various training programmes for

oping the Food Hub business model began

customers within a maximum of 24 hours

local producers in these areas, regardless

after a working visit to Philadelphia and New

from the time an order is placed. Further-

of whether or not they collaborate with the

York. Together with the Civitas Foundation,

more, all their commercial activity is taxed,

hubs on the sales side.

www.business-review.eu Business Review | November 2020

www.business-review.eu

36 RESTAURANTS Business Review | May 2016

COVER STORY 14

Are sandwiches the next big thing on the local food market?

When I first read BBC GoodFood’s prediction in January that 2020 was going to be the year of the sandwich, it seemed like a far-away concept. But the pandemic has changed everyone’s plans, so in a year when restaurants are really struggling to survive, new venues downtown are adopting this model. Is Bucharest following the new sandwich business trend?

By Oana Vasiliu for staff, restaurants are now buying outdoor heaters to keep those who are still looking to enjoy a restaurant experience warm. But a new type of food business is feeding people in Bucharest: the sandwich business.

Business Review asked some specialists in the food industry if this was a solid trend or just a creative outlet for the city’s hipster foodies. Cosmin Dragomir from GastroArt explained: “It's an extreme consumption trend: it started 30 years ago with salami and ketchup burgers, followed by bad and very bad burgers, and then we learned how to make good burgers. The burger industry exploded in our country as we indulged in good quality coffee we bought on our way to work.

Later there was a vast offer and chefs came up with lots of delicious combinations. Then, we started to put other things between the burger buns, like pulled pork, for example.

And it worked. Then we changed the bun for the toast. At the end of the day, what we all did was to take the menu of a major fast food chain and make it gourmet. Only the sandEating sandwiches as a restaurant dish has become popular

A

wich is a real street food, meant to be eaten on the street, even though now, with masks pulled over half our faces, we cannot really

t the beginning of the year, before the

haps on outdoor seating, although it is getting

enjoy this type of meal. The unbeatable part

pandemic took over our lives, every-

quite cold.

of this story is that you can't go wrong. If you use quality bread, butter, and good cheese,

one was talking about three major

IS THE SANDWICH BUSINESS REAL OR JUST MARKETING BUZZ?

the taste is already guaranteed. So the sky is

restaurant menus: food mood, food cool, and food good, three concepts that underlined

The largest restaurant association in Roma-

pastrami or steppe viper fillets.”

the importance of eating well, with more and

nia, HORA, announced that almost 30 percent

"I have been observing the industry and

more customers starting to no longer view

of restaurants nationwide hadn’t opened back

studying concepts which are working domes-

food as a way to satisfy a primary need, and

up after the lockdown. With new governmen-

tically and internationally, and yes, I have

instead think about how our eating habits

tal decisions in place – such as the ban on

noticed a higher interest in sandwiches. Still,

play a part in nourishing our soul, mind, and

indoor eating – and very little financial sup-

this is more of an add-on than a standalone

heart. We still want these things even during

port, anyone opening a food business should

concept – there isn't a wide enough consumer

the pandemic, but now we are forced to enjoy

really be both brave and creative. After invest-

group for it. (…) This is because nowadays,

them as pick-up meals or deliveries or per-

ing in more disinfectants, masks, and gloves

consumers are looking for healthy food, made

global food movements that would change

the limit, and when I say sky, I think of zebra

www.business-review.eu Business Review | November 2020

RESTAURANTS 37

with local ingredients, usually served warm,

easy to eat, even if you're on the go, it's com-

while sandwiches are perceived as a low to

forting – we all need some extra comfort these

medium product that is served on the go and

days – and comfort food is right at the top of

available on the spot. (…) Of course, there

the list, it's fast yet filling and can be eaten

are places that have a gourmet approach to

hot or cold. Also, as a business model, I think

sandwiches, as they are made in-house, with

that a sandwich joint can be a great asset

high-quality ingredients, but here you have

for the food industry entrepreneur. A short

to take other aspects into account. A very

menu, but with a very well-curated selection

important one is that a sandwich may usu-

of sandwiches, is easier to implement than a

ally be sold for a certain amount of money,

full-service restaurant.”

usually up to 5 euros, as this is what consum-

Dragos Gurarosie, founder of Cheese Up,

ers find acceptable. In this context, if you

believes that sandwiches are “a trend that will

want to deliver a good, healthy option, your

consolidate further and, in time, will generate

margins could be really small, which is why

some tasty turnovers for investors. (…) As it is

you’ll need more profitable products,” said

a versatile product, both in terms of ingredi-

Dragos Panait, founder of HoReCa Next Root

ents and prices, you have a wide range of po-

Management Systems.

sitions to fill on the market and you can thus

Cristina Mazilu, one of the most famous

reach various categories of customers. Given

food bloggers and chefs, told BR that “the

the pandemic period we are going through,

whole sandwich hype can be qualified as a

and the crisis experienced by restaurants,

trend to some extent, but more importantly

I don’t think we can talk about a business

I think it's something we're all attracted to

yet. But we can talk about hopes, plans, and

because it ticks many boxes. A sandwich is

expectations.”

With a pandemic for which we do not yet have a cure, with struggling economies and a lot of people left jobless, and with restaurants being hit hard by this crisis, the sector needed to reinvent itself.

We clearly need to eat, even with this medical crisis in our lives. Although investments have not been very generous, some sandwich concepts in Bucharest have really taken off.

Must try downtown M.A.T. (121 Mircea Vulcanescu Street) - opened from Thursdays to Sundays, they serve Romanian tacos made from scratch with interesting fillings imagined by chefs Alex Iacob and Cristi Dascaleanu.

Grabit Pastrami (5 Calea Plevnei) - The menu is centred around beef pastrami, a specialty that is not commonly seen in local street food.

Boboko by Kaiamo (30A Emil Pangrati Street) - Based on recipes by Chef Radu Ionescu, Boboko serves tasty baked buns with premium ingredients such as tiger shrimps or slow-cooked pork belly, as well as vegetarian options.

Toast.Balls. (69 Calea Dorobanti) - The simple toast gets filled up with amazingly good meatballs from the wellestablished Balls restaurant, turning the sandwich into a new tasty experience.

Paninaro (3 Luterana Street) - Probably where the local sandwich trend started, Paninaro is the place to be and the place to taste premium Romanian products bought from small farms.

Papila Kitchen (6 Sfintilor Street) – Although best known for its soups, Papila also makes delicious sandwiches with amazing fillings. Some of them should be eaten hot, so grab a seat on their tiny terrace and enjoy your meal.

Centocitta (12 Calea Floreasca) - Classic Italian recipes with a modern approach and quality ingredients are on offer here, introducing Puglia's traditional puccia sandwiches to the local scene.

www.business-review.eu Business Review | November 2020

www.business-review.eu

38 CULTURE Business Review | May 2016

COVER STORY 14

Who will save Romania’s independent cultural sector?

Once upon a time, Romania was an emerging market for artists and cultural entrepreneurs who were committed to work hard to define the Romanian independent cultural sector as a new creative hotspot in Eastern Europe. Festivals, events, performances, galleries, industrial spaces, concerts, and all kinds of artistic approaches had an open scene and an audience here.

But the coronavirus pandemic has changed everything.

By Oana Vasiliu HIGH HOPES MET WITH PROMISES An effervescent debate is taking place around the funding provided by the National Cultural Fund Administration (AFCN), in a project competition worth almost RON 32 million designed for the independent sector, with a limit of RON 85,000 per project.

Is it enough for a team to create something artful, be paid for it, and also advertise it in order to attract an audience? Nobody knows, as the results of the winning projects are not public yet. Still, the entire independent sector cannot rely solely on these funds.

W

With indoors closed, arts and culture moved online.

But few are willing to pay for this type of entertainment

There was some enthusiasm recently following a statement made by the new mayor of Bucharest, Nicusor Dan, who said that

ith no financial support from

which the Romanian cultural sector has been

an annual budget would be allocated to the

local authorities or any state

affected, one concrete action taken by the

independent sector instead of the public fairs

aid schemes from the Culture

Culture Ministry has been to allocate money

and free concerts which the previous mayor

Ministry, Romania’s independent cultural

for contemporary art acquisitions through

had primarily financed. “We have promised

sector is struggling. There is a little support

the National Museum of Contemporary Arts

emergency aid for the running costs

from initiatives like crowdfunding campaigns

(MNAC). An extra RON 2 million was ap-

of independent cultural institutions which

that may help independent actors pay their

proved for MNAC’s budget to buy Romanian

have been affected by the medical crisis,

rent and calls for micro-funding projects, but

contemporary art, following an acquisition

an emergency inventory of cultural spaces

the sector is currently bleeding out. Inde-

procedure carried out through an art expert

in Bucharest and, in the future budget, an

pendents, NGOs, and professional cultural

commission, which has been publicly criti-

allocation of funds for the independent

associations have met with the government

cised as not being very friendly to indepen-

cultural sector,” Nicusor Dan wrote on his

and demanded financial support or any kind

dent contemporary artists. Unlike concert

Facebook page.

of help, but there has been no news so far.

halls, theatres or cinemas, museums and

What’s more, Romania’s is not included in any of the EU’s cultural and creative guides.

Plenty of information and resources are avail-

It’s quite interesting that not even seven

galleries are still open for public, so maybe

months after the pandemic first hit Romania

you could spare a penny for the arts.

does anybody know how many people in

Everything seems to have moved online,

the independent cultural sector have been

able online: for example, EUNIC Global car-

yet local streaming platforms, although

affected by the shutdown of spaces and the

ried out a quick survey among its members

well-advertised and promoted, are not hitting

cancelled events, let alone how many inde-

on their government’s initiatives to mitigate

impressive numbers. Concerts, theatre plays,

pendent cultural spaces which need financial

the loss of income for artists and creative pro-

live performances or even improv shows are

aid to pay their bills.

fessionals. It found examples from most EU

being delivered online for buy-in-advance

But everyone is still planning activities

member states, but nothing from Romania.

tickets, but few people are expressing inte-

and events for 2021, when we’re all hoping to

rest.

get our normal lives back.

While nobody yet knows the extent to