Page 1




Alma Rusu, founder of the MioBio or-

The education bill currently going

The new support scheme for renewable

ganic cosmetics shop, is planning to in-

through Parliament has sparked inter-

energy power plants is put under the

crease her business this year in a

est and controversy among the NGOs

lens by lawyers, who pick out the good,

healthy and sustainable manner

who look out for children’s interests

the bad and the ugly in the law


See pages 12-13

See pages 14-15


JUNE 21 - 27, 2010 / VOLUME 14, NUMBER 23


As the world’s footballing elite do battle in South Africa, local terraces, drinks firms and betting agencies are seeking to match up by scoring from the World Cup themselves STOCKEXCHANGE

See page 21

IN TOUCH PARLIAMENT HAS NO CONFIDENCE IN NO CONFIDENCE MOTION Parliament voted against the motion of no confidence proposed by the Social Democrat Party against the government. The cabinet will therefore proceed with applying its unpopular austerity measures which include redundancies, a 25 percent cut in public sector salaries and 15 percent cut in pensions. Read more on page 4 TALK TO US !

IN TOUCH JOB WELL DONE Thank you for your article on recruitment and salaries last week ( Increasing layoffs send jobless f locking to r ecruitment sites, issue 22). I am a new graduate hunting for my first job, and it is often an intimidating process. As your reporter states, Romanian companies often withhold the salary when advertising a position, and it makes it very dif ficult for someone new to the work force to work out what is a

fair wage, so your list of salaries was very useful to me. I look forward to more coverage of the jobs and recruitment field. A ncuta Iovan, Bucharest PEDESTRIAN POWER A big thank you to the organizers of Street Delivery (Street Deliv ery sees culture, creativity and civ il responsibility pound the pavement, issue 22 ). Bucharest is a beautiful city, but much of its beauty is spoiled by the

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Please send your letters to, including your name and location. For consideration for inclusion in the nex t edition, letter s m ust be r eceived by noon on T hursday. L etters m ay be edited f or length, clarity and accuracy. BUSINESS REVIEW / June 21 - 27, 2010

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CRAMELE HALEWOOD TOASTS THIRD STORE é Cramele Halewood has opened a new store on the local market, The Winery Outlet. Located in Breaza, Prahova county, it is the company’s third store after those opened in Aguga Rhein Cellars and Ploiesti. It covers an area of 70 sqm and offers over 100 varieties of the producer’s wines and about 300 imported varieties. “The Winery Outlet is part of the company’s expansion plan of own stores, after the success registered by the first two we opened in Azuga and Ploiesti”, said Dan Muntean, the company’s managing director. 4

All that glitters: investors with the jitters are seeking safe places for their wealth

In a new high, an ounce of gold rose to almost USD 1,260 last week.

The previous record was USD 1251,2. During the trading session last Friday, spot market gold reached a maximum of USD 1,257.85 per ounce, before returning to USD 1,256.45 per ounce at 12:15 GMT on the European market, compared to the USD 1,234.4 at the end of the previous day in the US. Among the factors influencing the sudden growth in the price of gold is investors’ concern that loose monetary policy will unleash inflation. Poor economic reports for the US and a weakened dollar were also reasons for investors doubting the American currency’s strength. Corina Dumitrescu

Orange brings iPhone 4 to Romania Orange will launch the iPhone 4 in Romania in the coming weeks. The operator did not comment further on when, or the price at which it would sell. Wouldbe buyers who want to find out the exact date when the handset will become available can fill in the form at Orange also launched the previous iPhone models, iPhone 3G and iPhone 3GS in Romania, which, according to company representatives, “have posted the best sales among Orange Romania smart-phones.” Otilia Haraga

Defeated no confidence motion paves way for austerity measures The Social Democrat Party’s motion of no confidence against the governing Democrat-Liberal Party’s proposed austerity measures was rejected last week, with the 228 votes in favor falling eight short of the 236 finishing line. Of the total 428 ballots cast by Members of Parliament, 197 were against the motion, while three were annulled. Even some members of the Democrat-Liberal Party joined the opposition in voting for the no confidence motion, for which some may now be dismissed from the party. The failure of the measure clears the way for some of the most drastic economic measures of Romania’ s post-communist history to be applied. Pensions will be reduced by 15 per-


DOOSAN IMGB DELIVERS NEW NUCLEAR USE SHELL é Bucharest-based heavy equipment manufacturer Doosan IMGB will deliver a new nuclear equipment component to South Korea, two weeks after it delivered another nuclear use shell to the same destination. According to Doosan IMGB executives, deliveries of nuclear use shells will continue at a pace at least as high and should take the share of nuclear equipment in the company’s 2010 turnover beyond the 7 percent currently accounted for by existing contracts.


BANK OF CYPRUS ABANDONS PLAN TO HIKE BT STAKE é The financial group Bank of Cyprus has dropped plans to double its share package in local lender Banca Transilvania (BT) from 10 to 20 percent, stating that it is reconsidering its priorities. Banking sources, quoted by media reports, say that group’s decision was influenced by signals from the EBRD, the main shareholder in BT with a 14.6 percent stake, which is waiting for an investor of a different size that would buy into the bank on the basis of a bid selection, and not through minority purchases on the stock market. The Bank of Cyprus has EUR 40 billion of assets, half the size of the Romanian banking system.

Gold price hits new high, as investors seek safety

Still standing: The government survived the vote

cent, leaving the minimum pension at around EUR 82, while the minimum salary will fall to EUR 141. Public

sector workers will also be af fected, with 25 percent salary cuts, as well as large numbers of layoffs. The opposition parties are entitled to bring yet another no confidence motion, said Victor Ponta, the SocialDemocrat Party’s leader. Ponta hopes the motion will bring about important dismissals i n t he cu rrent c abinet, peaking with Prime Minister Emil Boc’s resignation. The government says the tough austerity measures, part of a wave of state cost-cutting across Europe, are necessary to secure the next installment of an IMF bailout package to finance the country’ s current account and budget deficit. Corina Dumitrescu

Erste employee shares float on stock exchanges

Erste shares will also be transacted abroad

The 251,365 shares issued by Erste (EBS) as part of its Employee Share Ownership Program (ESOP) began to be transacted on the Bucharest, Vienna and Prague stock exchanges on June 18, after having been released on May 27. The local number of Erste Group stocks grew from 377.92 million to 378.17 million. Employees who received such shares through the program have to keep them for minimum one year . The bank’s employees own 3.2 percent of the capital, while 5.9 percent is in the possession of local banks. Pri-

vate investors hold a 6.3 percent participation. According to the most recent reports, the Austrian bank is 26.1 percent owned by Erste Stiftung, while Criteria Caixa Corp controls a capital stake of 10.1 percent. The American Investment Administration Company, Capital Research, hold a 5.1 percent participation, with 43.3 percent of the Austrian bank’s titles owned by institutional investors. The price of Erste shares dropped by 0.57 percent on June 17, reaching RON 121.7. Corina Dumitrescu BUSINESS REVIEW / June 21 - 27, 2010

NEWS Govt approves Postal Company restructuring strategy

BUSINESS REVIEW / June 21 - 27, 2010

segment until 2014. Another is to increase the market share to at least 20 percent of the domestic express delivery segment by 2014 and to increase the weight of courier , financial and mailing services to 35 percent of the company’ s total turnover. The restructuring measures will also see the optimization of the regional structure, as well as the development of five profit centers and five support & profit centers. Additionally, a support agreement was signed between the Ministry of Communications and the Italian government, which stipulates that the Italian postal company will supply its Romanian counterpart with technical support in the logistics, financial services and strategy areas. The re-organization of the CNPR has already started with the restructuring of regional directions reducing their number from ten to seven. The IT structure on which the company will operate was devised to be compatible with the e-Romania site. Otilia Haraga


The government has approved the strategy for the restructuring and modernization of the Romanian Postal Company (CNPR). “The CNPR is being run on principles from 1952, and we wish to bring it to the level of 2010. At the moment, we are implementing a competitive organization plan, based on market principles, with profit centers. The Romanian Postal Company will not be sold, not during my term,” said Gabriel Sandu, minister of communications. Shareholders in the CNPR, a company with state capital, are the Romanian government, through the Ministry of Communications, and the Property Fund. The long-term strategy has several aims. The first is to turn the company around financially, so that at the end of 2014 it posts a gross profit of RON 50 million. The second is to up the revenues in the financial services segment so they represent at least 25 percent of the company’s total revenues by the same deadline. A third objective is to keep the market share at at least 75 percent of the correspondence

Romtelecom gets 60,000 new clients

Yorgos Ioannidis, GM of Romtelecom

Romtelecom, the lar gest landline provider in Romania, has acquired 60,000 new customers through its NextGen subsidiary , according to company representatives. “At this point, NextGen has reached 160,000 clients,” they said. NextGen is the firm through which the operator makes acquisitions of small networks, to increase its footprint across the country. It is mainly present in Moldova and in the southern part of the country. In the past few months, Romtele-

com has also signed the acquisition of New Com Telecomunicatii, based in Cluj, as part of the expansion strategy it leads through NextGen. Ovidiu Ghiman, executive manager for strategy and business development, previously said, “Our plans are to keep looking for potential acquisitions in the market even if they are small local operators or maybe ones which are playing in a higher number of counties, both on broadband and TV.” Romtelecom is part of the Greek group OTE. Recently , Panagis Vourloumis, president and general manager of OTE, came under fire as he was investigated in a corruption case which involved some technical support contracts. The investigation also included Yorgos Ioannidis, currently general manager of Romtelecom, who was technical director of OTE. “The case refers to the provision of technical support by INTRAKOMSIEMENS-ANKO for the maintenance of OTE’s networks for the period prior to 2004 when the present management took over,” said OTE officials. Otilia Haraga



McDonald’s Romania celebrates 15th anniversary

McDonald’s Romania celebrated last week the 15th anniversary of the opening of its first outlet in the country. “Throughout our history , we are pleased to have employed so many people, contributed to the local economy and developed local products as we grow our brand. The long-term opportu-

TCE launches first private post office network in Romania


It will offer growth perspectives to those that have the operating capacity to of fer such services at a national level, as is the case of TCE,” said Sorin Sofian, CEO of TCE Holding. The company plans to open over 2,000 such offices in the next five years, estimating that the business will reach EUR 7.5 million, according to Dan Rosu, business unit manager of TCE Post and project manager of TCE Post Office. The division will of fer traditional post office services as well as courier options, anywhere in Romania and in another 20 countries. There are 46 such of fices already First class: the postal market is still attractive operating, 6 out of which are run under the agency regime. TCE, part of R TC Holding, has anTCE Logistic declared insolvency nounced that it will launch the first priearlier this month. The courier posted for vate post office network in Romania un- 2009 a EUR 19.5 million turnover but a der the TCE Post Office brand. negative EBITDA of EUR 350,000. It “Although 2009 was a very hard has run up a EUR 8.5 million debt, EUR year for the market, Romania has a lot of 3.3 million of which is credit. catching up to do, including in the field This was the second company in the of postal and courier services dedicated RTC Group controlled by businessman to individuals and small companies. As Octavian Radu that has initiated insolthe market has slowly liberalized vency procedures, after retailer Diverta. (opened), it hasn’t lost its attractiveness. Simona Bazavan 6



Karen Bishop, MD of McDonald’s Romania

nity in our market remains strong. We will continue to match consumers’ changing lifestyles and needs by of fering new services, new occasions to visit, and new menu of ferings,” said Karen Bishop, managing director of McDonald’s Romania. Located in Piata Unirii, the fast food chain’s first local branch served over 15,000 customers on its opening day, setting a central European record. Since 1995, the company has launched 62 restaurants in Romania, employed more than 3,400 people and invested over RON 300 million in the development of its business. It has served a total of 500 million customers – more than 140,000 every day, according to the company. McDonald’s plans to open three new restaurants in 2011 and remodel five existing ones. It expects a 5 percent turnover increase this year. Simona Bazavan

First Romanian mall to file for insolvency sells for EUR 30.5 mln

Ups and downs: several malls are in trouble

Tiago Mall in Oradea, which filed for bankruptcy in May, was sold for EUR 30.5 million to a firm whose headquarters coincide with Baneasa Investments’ location, from an asking price of EUR 35.5 million. The auction was or ganized by the Transylvania House of Insolvency and the project

developer’s liquidator , MLS Pr oject Oradea, subsidiary of Mivan, the Irish Group. The original investment for Tiago Mall was EUR 65 million, credit obtained from UniCredit Austria and UniCredit Tiriac Bank. “The project was won by Shopping Center at a price of EUR 30.5 million, plus VAT,” Vasile Pop, the liquidator’s representative, told media. Shopping Center Holding is 90 percent held by the Cypriot firm Karias Trading Limited, while Ciocoiu Dumitru owns the rest, according to the Trade Register ’s National Office. Tiago Mall filed for insolvency even before it was finished. The mall market in Romania is becoming oversaturated in such shopping destinations and, consequentially, malls from Sibiu and Braila had to be closed due to the lack of tenants and clients, say insiders. However, Tiago Mall is the first mall to have filed for insolvency. Corina Dumitrescu

Kaufland invests EUR 70 mln in expansion in 2010, returns to 2006 level

Discounter Kaufland’s investment budget has increased again after two years of falls

German discount hypermarket chain Kaufland has reported investments in network expansion of around EUR 70 million, close to the total value of its competitors’ 2010 extension budgets, says the company . The retailer has already opened eight new locations in 2010, taking it to a total of 53 units, which it aims to supplement with another six or so stores by the end of the year. With an EBRD credit of EUR 150 million, Kaufland’s 2010 investment budget might reach EUR 130 million, a level similar to 2006, after falls in 2008 and 2009. Real, Cora, Carrefour and Auchan, Kaufland’ s main competitors on the Romanian market, have each an-

nounced a single extension project for 2010, with cumulated investments reaching around EUR 90 million. The locations targeted for new Kaufland stores are Romanian towns with a population of fewer than 50,000 people, such as Mioveni, Reghin and Campulung. The retailer , part of Lidl and Schwarz group, aims to reach 20 small towns with low purchasing power through the EBRD resources, which will also be directed towards the Bulgarian market. In order to support the network’s expansion next year, the German group might inaugurate its second logistical center in Romania. Corina Dumitrescu BUSINESS REVIEW / June 21 - 27, 2010


Agricover launches Agricover Vet Deloitte: Companies relying on

Agricultural solutions supplier Agricover is launching a new division, Agricover Vet, dedicated to the zootechnical segment. “The d ecision t o e xtend w as based on some major ar guments. First of all, our capability and expertise in the agriculture business can be easily transferred from growing plants to growing animals. Secondly, an important way to develop the country’s agriculture in its en-

BUSINESS REVIEW / June 21 - 27, 2010

government to revive economy



Seed of an idea: Agricover will transfer its expertise from growing plants to animals

tirety would be for farms to integrate vegetal production and zootechnical a ctivities, a p rocess that Agricover supports,” said Robert Arsene, general manager of Agricover Group. He added that the company’s long-term objective is to extend the all-in-one store concept to the new line of business. In the first phase however, Agricover Vet will supply animal farms with feed, nutritional supplements and later veterinary drugs. The company is mainly tar geting mixed farms which are already its customers, and other medium and large animal farms. Last year the group posted a 20.2 percent increase in its turnover and a 68 percent growth in profit. The group plans to further raise its turnover by 20 percent this year , to reach RON 480 million (approximately EUR 113 million). In 2010 Agricover Vet is estimated to contribute a 1 percent share of the group’s t urnover. Agricover w as founded 10 years ago and now operates 9 companies and divisions. Simona Bazavan

George Mucibabici, chairman of Deloitte, believes the austerity measures are necessary

In the context of the prolonged global recession, local companies expect more support from the state, considering governmental stimulus to be the most important catalyst to help turn the economy around, according to the second Roma nian CEO survey, released recently by Deloitte Romania. “As predicted, the crisis in 2009 has swept through the business community, challenging companies to stand their ground, if they can.

2010 is the year when survivors get back in the race. But there are no winners yet, as the crisis deepens at macroeconomic levels and the pressure for governmental support and restructuring grows stronger ,” said George Mu cibabici, c hairman o f Deloitte Romania. He added: “Romania’ s recent decisions, to resort to harsh economic measures, can prove paramount in reviving the economy . By reducing social protection costs, the state can finally concentrate ef forts and funds on the real economy.” According to the survey, companies have already begun cleaning house, and restructuring will continue in the current year, with a goal to achieve growth, improve quality of service and increase brand awareness. Deloitte’s survey was carried out between February 20 and April 30, and reflects contributions from more than 150 leading Romanian businesses in terms of revenues. Staff



Swiss Windex to invest EUR 25 First Nokia Care Center in mln in local wind turbine factory Europe opens in Bucharest

Swiss Windex is planning to start the construction of a wind turbine production facility in Constanta county , south-east Romania, in two months. The total investment, estimated to reach EUR 20-25 mil-

Contract for Timisoara-Arad highway could be scratched


Highway to hell: the contract could be torn up

The minister of transportation, Radu Berceanu, has criticized representatives of the Poor construction company because only 7 percent of the Arad-Timisoara highway has been finished halfway into the time frame for completion. Some 400 days have passed already and the entire term for the project is 720 days. The ministry might ask for the contract to be torn up, writes Mediafax newswire. Berceanu said there had been delays of nine months for the Arad 8

bypass and six months of delays to the highway segment in Timis. The minister said the firms were trying to “buy time” and ask for changes in the technical aspects to pump up the prices. “After they win, they start to stall so the price will increase. This happened here as well, more inArad and to a lesser extent in Timis. They are asking for the alteration of the technical solutions that are stipulated in a very comprehensive document,” said Berceanu. The minister also said there was an older problem that needed to be resolved. “In public auctions, firms offer very low prices to win. In the auctions, the candidates are companies that have built many highways, but in Spain and Portugal… In Romania, they have 13 people, no equipment, no employees, but they present the achievements they have there, 3,000 kilometers away . So in this way, companies with a history win the auctions, and then they outsource everything,” added Berceanu. Otilia Haraga



Romania has only 14.1 MW of wind power

lion, should be completed in approximately 12 months, according to Nicolae Simion, the company’ s manager for Romania. Windex produces small and medium-sized wind turbines. Several major international energy companies, such as Czech CEZ and Spanish Iberdrola, have concrete plans to build wind farms in Romania, mainly near the Black Sea. So far, CEZ has already built 70 wind turbines of 175 MW installed power at Fantanele, Constanta county. In April, Iberdrola was granted a license to connect 1,500 MW of wind power to the national electricity system, through 50 wind farms to be built by 2017. Currently, Romania's wind power generation capacities total only 14.1 MW. Staff

Handset happenings: the center is Europe’s first

Nokia Romania has opened Europe’s first Nokia Care Center in Bucharest. Customers in Romania will be the first to have access to the entire range of the mobile phone firm’ s assistance services. “The unique component comes from the fact that the center ’s personnel will help users install applications that they want on their handsets. Our main objective is to offer Nokia users the pos-

sibility to benefit to the utmost from their mobile phones,” said Razvan Petrescu, country manager of Nokia Romania. Representatives of the company did not make public the sum invested in opening the unit. The Nokia Care Center has eight employees and is located in Bucharest on 59 Grigore Alexandrescu Street. It will operate from Monday to Friday between 10 am and 8 pm and on Saturday between 10 am and 4 pm. The center will of fer services of standard and post-warranty repair, recycling, Nokia Care support, the activation of Nokia services and sale of accessories. It includes a fully equipped technical workshop, free internet access, a space for the newest Nokia accessories and a lounge for consumers. The facility was opened in partnership with Euristic Partner, a company that will provide the logistics and management of the new business. In 2008, Nokia posted a net turnover of RON 1,678,450,508 (approximately EUR 421 million) and a profit of RON 62,275,522 (approximately EUR 15.6 million), according to data from the Ministry of Public Finance. Otilia Haraga

Wizz Air flies 31 percent more passengers Low-cost air carrier Wizz Air has announced a 31 percent increase in passengers in the first five months of 2010 on the same period of last year. The company registered 736,000 passengers in the period compared to 562,000 in 2009. The increase consolidated the airline’ s leading position on the local lowcost segment with a 46 percent market share in June. “We are on schedule to surpass the 2 million passenger tar get this year. The 31 percent increase was mainly g enerated b y t he g reater flight capacity from Cluj-Napoca and Bucharest and subsequently by new routes and higher flight frequency for all our three bases, including Timisoara. Bucharest will continue to make up 50 percent of our operations from the number of passengers point of view,” said Gyorgy Abran, commercial director of Wizz Air. This summer the airline will add two more new A320 planes to its

Flying high: low-cost airline Wizz is introducing new routes this summer

six-aircraft fleet, thus creating 70 new jobs. The first aircraft has been operational from Cluj-Napoca airport since June 12 and the second will fly from Bucharest from June 26. The no-frills carrier will also operate new routes to European destinations from this summer. Simona Bazavan BUSINESS REVIEW / June 21 - 27, 2010




é Mamaia Resort Hotels organizes a seminar about the hotel investments

MARIANA GHEORGHE is the newly elected president of the Foreign Investors Council (FIC). Gheorghe, CEO of Petrom, is taking over from Shachar Shaine. Following the general assembly of the FIC, a group of fifteen individuals was elected for the board of directors, all of them senior country managers with significant international experience in industries important to the Romanian economy.


at Golden Tulip Mamaia. By invitation only.

JUNE 22 é organizes a conference on the latest fiscal changes.

JUNE 23 é Business Review organizes the second edition of the Dutch Business

Forum at InterContinental Bucharest. For more information please visit é Lafferty Group organizes the Lafferty World Series of Retail Banking

and Consumer Finance one-day conference in Bucharest. By invitation only.

JUNE 26 é The ‘Run Romania’ Sports Association organizes the ‘Run Romania’


JUNE 29 é Business Review organizes the American Business Forum at InterCon-

tinetal Bucharest. For more information please visit www

ANDREI ORCULA has been appointed art director at Senior Interactive. He previously worked for S cala J. Walter Thompson, DDB Bucharest

NEWS and Starlink, for clients such as Nokia, Nestle, Vodafone, Kraft, Bancpost and Greenpeace. ADRIANA MOGOS, 29, was appointed strategic account manager at CallPoint New Europe. For the past seven years, she has been working in the call center & BPO industry, for large companies such as TechTeam, WNS, and HP . In her new position, Mogos will be running two strategic accounts: a large Romanian reactivation project in the retail industry , as well as debt collection campaigns for a global credit player.

Business Review welcomes information for Who’s News from readers. Submissions may be edited for length and clarity. Feel free to contact us at

Dinel Staicu suspended as head of SIF Oltenia after jail sentence

Own goal: Dinel Staicu, former football club owner, has been sentenced to jail for fraud

Dinel Staicu, head of the financial investment company SIF Muntenia, has been suspended from the position for two weeks, according to company representatives. The decision was taken by the National Securities Commission (CNVM) after the former owner of the Universitatea Craiova football club was sentenced to jail in a fraud case earlier last week. Alongside Staicu, Ion Popescu, the former president of the International Bank of Religions (BIR), was BUSINESS REVIEW / June 21 - 27, 2010

also imprisoned without suspension for four years and fined over RON 8 million. Staicu and Popescu were charged in 2009 with a EUR 5 million fraud at BIR. According to prosecutors, Staicu used the money to buy SIF Muntenia shares through companies that he owned. Over EUR 1 million was used to buy the stock while Staicu was head of SIF Muntenia. Simona Bazavan 9


Seeking organic growth on a healthy market challenges is to educate consumers, with the enterprise being more reliant on specialized advice. “Except the clued up customers who are aware of what or ganic care means and come to buy certain products from us, there are those who are willing to try , experiment and want to benefit from taking care of their body, to whom we of fer guidance,” says the managing partner . In addition there is the challenge of an emerging market that is facing a difficult economic period. According to Rusu there is no real competition on the market yet as there are few such specialized shops. “The competition is very friendly because all the players on this market are to some extent beginners. Experience of a few years in this field on the Romanian market is not a tradition,” says Rusu. She expects the number of such shops to increase in the years to come. In her Anca Ionescu opinion, the consultancy services her store offers differentiate MioBio Alma Rusu, managing partner at from the crowd. “Our online store – MioBio, a shop selling or ganic – is in addition to metic products, left the corporate what we can of fer in the traditional world at the beginning of 2008, her store. At the beginning we were surmain objective being to take a break prised by our customers’ reaction . But the break became a sabbatical. when they said that they felt like “During this period I reflected on they were in a store from the West,” my professional future, with two cosmetics in Bucharest able to of fer adds Rusu. clear choices in mind: to come back least one year of working in a corAccording to market research, poration,” adds the young entrepre- a careful selection of dif ferent well into a specific system or to launch known or niche brands. In short, this organic products have a market neur. my own business,” remembers was the concept on which MioBio is share of 1 percent and so Rusu says The decision to set up MioBio Rusu. She ultimately chose to bebased,” says the managing partner . it is hard to estimate her own store’s was not a spontaneous one. “I come an entrepreneur and since market share. “Analysts say that this though that if I decided to establish She adds that MioBio reflects both 2009 has been running the MioBio market increased by 30 percent last the ideas and personality of herself a business it should be something store. The shop brings on the local year on 2008 and expect a 40 perclose to my soul, which allowed me and her business partner. market a wide range of notable Reflecting on the dif ficult mo- cent rise in 2010 compared with brands from Germany, Austria, to stay close to the people. I decided France and Switzerland, some of on this field of activity which I con- ments MioBio has faced, Rusu says 2009,” she says. Going forward, they are only just starting because Rusu says the firm intends to sider extremely interesting and which are manufactured in limited the business has reached another focus on developing its distribution, series while others enjoy a world- complex,” explains Rusu. She says increasing its product portfolio that despite having had no experi- stage of development. “The beginwide presence. ning was very smooth – it took one and consolidating the brands ence in or ganic cosmetic products Rusu graduated from the Foryear from the idea to its implemen- it has debuted on the Romanian eign Languages and Literatures Fac- her time working with many multimarket. tation with the opening of the store nationals gave her a solid base on ulty back in 1997 but has never in August last year as a result,” she worked in the area she studied. She which to build and run such a says. The entrepreneur adds that this business. Individual study and speentered the HR world in 1996 and cial training at each individual sup- year the company will focus on despent six years in the head-hunting veloping distribution for the industry. Her next position was also plier also played a significant role. é 2009 estimated turnover (Aubrands it exclusively represents in August last in HR, and saw her put another six The shop opened in gust-December): EUR 30,000 Romania. “It is an intensive period year. years into the banking sector at the é 2010 estimated turnover: EUR The businesswoman chose to set when both decisions and resources former HVB Bank / HVB Tiriac Bank, which later became UniCred- up MioBio because the or ganic need to be very carefully weighed 120,000 products market is still young in Ro- up.” it Tiriac Bank. She also had a brief é Number of employees: 2 If the partners started the same intermezzo of four months in Am- mania. Besides, this field has signifé Initial investment: EUR 35,000 icant potential for growth in the fu- business over again, they wouldn’ t man, Jordan, where she worked for é Total estimated investment: EUR change anything because they think the elections program or ganized for ture with consumer interest rising. their company is on the right path. “I noticed a lack of a multi-brand Iraqi residents abroad. “I could 45,000 boutiques speci alized in or ganic In Rusu’s opinion, one of the main compare this experience with at

While ALMA RUSU intends to

increase the turnover of MioBio, her organic cosmetics store,

four-fold to EUR 120,000 this

year, her main objective is to

grow the business in a cautious, smooth and healthy manner.



BUSINESS REVIEW / June 21 - 27, 2010


New education bill provokes different schools of thought Long heralded but never actually taking place, the reform of the Romanian education system, vital as it is, might just become reality this time if Parliament, which is currently debating a draft education bill, approves it. But is the new bill really going to bring the local education system into the 21st century? Business Review talks to some NGOs, the last line of defense for children’s education when the system fails them. And they have plenty to say.

The bill for the new Education Law launched by Minister of Education, Daniel Petru Funeriu, was supposed to move quickly through Parliament, allowing it to come into force in time for the next school year , which starts in September. It was introduced into P arliament t hrough e mergency measures for the purpose. However, the Education Commission in the Senate has asked for a week’s extension to the June 18 deadline to allow for the completion of a report on the Education Law, after which the bill should be debated in full session. That education has not been a priority in recent years can be seen clearly in the continuous decline of the education system: underpaid and unprepared teaching staf f, an ever increasing school dropout rate, school violence, an outdated and entangled curricula, lack of respect for education which translates into a high illiteracy rate or, at best, unprepared graduates who find it hard to secure a job. Now , as things stand, chances are slim that the new law will be ready in time for the next academic year. In its current form, the draft introduces several major modifications that are meant to change the system from 12


Otilia Haraga

Learning curve: the new bill aims to improve Romania’s education system

teacher-oriented to pupil-oriented and make education more practical and less theoretical. Last Thursday, the Senate’ s Education Commission adopted an amendment which stipulated that compulsory education should last 1 1 years. Pre-school education in kindergartens, between five and six years of age, will be compulsory, according to Mediafax n ewswire. Therefore, t he primary school stage will last four years, between six and ten years of age, and gymnasium education another five, between ten and fifteen. Finally, the Senate decided that, of the four high-school years, only two will be compulsory. “The strength of the law will depend on the secondary legislation created to implement and enforce it. The law creates the legal framework for measures – good measures – but as the saying goes, the devil is in the detail, and the details are in the secondary legislation,” says Leslie Hawke, founder of Ovidiu Rom NGO. The bill proposed by the Educa-

tion Ministry introduced the ‘school after school system,’ in which pupils will be supervised by teachers while they do their homework. Save the Children NGO notes that the draft law puts the child as the main beneficiary of the education process, with a focus on laying the foundations for community involvement in the life of the school, support for early education as well as stipulations regarding after-school learning. The financing of schools will also change under the new law . Three forms of school financing will be introduced – basic, complementary and supplementary – depending on the performance of the educational establishment. “What effect will this have? State schools will enter into direct competition for pupils and funds with private schools. As a direct result of the competition, schools will become better while those who do not yield results will disappear ,” says Tincuta Baltag, general manager of the Dinu Patriciu Foundation.

Still, despite its good points, commentators say the law is lacking in areas. Save the Children points out that the bill ignores some essential principles, including: combating segregation, preventing violence in schools, eliminating hidden costs which may be a barrier in the education process and ensuring access to education for children who were not registered at birth. “It is worrying that the presence of the school counselor in educational units is not stipulated as compulsory , as he/she is only mentioned as auxiliary personnel. Also, we deem it necessary that each school benefit from the involvement of a social worker because this specialist can identify in time certain difficulties felt by pupils,” say Save the Children representatives. The rate of school abandonment increased threefold between 2000 and 2007 from 0.6 percent in the school year 2000/2001 to 1.9 percent in 2007/2008. Statistics for 2008/2009 show that almost half the teenagers in the rural areas do not attend secondary education (high-school, arts & crafts schools) unlike teenagers in urban areas, as shown by the Report on the National Education System published by the Ministry of Education. “The law won’t be very helpful in preventing school abandonment, because it doesn’t address its underlying causes: poverty and late enrollment. The law provides for punitive measures against parents not sending their children to school, but fines and compulsory community service imposed on parents living in extreme poverty, or homeless, or without papers, simply do not work,” argues Hawke. She cites “door-to-door recruitment and the provision of school essentials like shoes, clothes, and school supplies” as the most effective method of getting impoverished children in school. “Local authorities should be accountable for having every child age five or over in school – but how they accomplish this should be decentralized, with local civil society and businesses encouraged to play a part. Punitive measures should only be invoked for intractable cases,” she adds. It is up to the secondary legislation which “absolutely must specify how it will address the continuing decline in Romania’s literacy rate,” says Hawke. “No picture emer ges of a strategy for including disadvantaged children, who make up a sizable percentage of Romanian children – by some estiBUSINESS REVIEW / June 21 - 27, 2010

TALENT mates, as many as one out of every four children. This issue warrants a specific nationwide strategy,” she continues. Pre-school education has been made compulsory between five and six years of age, as amended by the Senate. “Optimally , children as young as three should be included in pre-school education. Making early childhood education available – for all – should be a major goal of the new law. This is especially important for children from disadvantaged families who receive less intellectual stimulation in the home. When children start school behind, they stay behind (…) The international research is clear that the money spent on quality early education saves taxpayers significant expense in future costs,” she adds. Teachers are among the professions that will be heavily af fected by the austerity measures taken by the government. As public sector workers, their wages will be reduced by 25 percent. “A 25 percent cut across all public sector jobs is obviously the easiest, most impersonal way to cut. But it is also the least effective way to cut – and it sends the wrong message to society. Everyone knows that there is a lot of

BUSINESS REVIEW / June 21 - 27, 2010

‘dead wood’ in the public sector . So cut the dead wood. Give 100 percent salary cuts to teachers who aren’ t performing, but don’ t penalize the youngest, lowest paid teachers who are dedicated to their vocation, and don’t penalize master teachers,” says Hawke. There are no signs that things will improve in the way teachers are stimulated, even if the new law comes into force. “It doesn’t provide for a resultsbased teacher remuneration scheme; it does not motivate teachers to work in poor areas,” she says. Also, not clear enough are stipulations regarding plagiarism. “Fraud and intellectual theft are often accepted and this cannot have positive ef fects for the recovery of the Romanian school. (…) I would have specified clearly in the bill that teachers who plagiarize – if proven in a court of law – cannot go back to teaching anymore,” says Baltag. “To summarize, the main defect of the bill is that it tries to carry out reform with the breaks on,” adds Baltag, explaining that it suf fers from “over regulation: it is too dense and does not leave room for real de-centralization.” This means the role of the Ministry of Education should shrink and the role

of the community and parents increase. “It is the school, in collaboration with the parents and the community , which should be in char ge of the curricula, the recruitment and training of teachers, rewards for good teachers, evaluation systems, the annual budget and multiple sources of financing. High schools should be free to choose the way they select their candidates,” says Baltag. She adds that Romanian schools suffer from unhealthy pressure regarding grades: a low grade in a test is seen as a failure. By contrast, in the best performing systems, pupils compete with themselves and grades are confidential. Education is more personalized. “W e still have standar dized, mass education,” says Baltag. “What I can tell you is that, as an employer , I would never look at the grades a candidate scored in school. I am looking for creative people with good communication abilities, with a critical sense, tolerant, altruistic, optimistic and constructive, and these things are not yet measured in our schools. Currently there are no grades for creativity, tolerance and respect – only for learning by heart outdated and useless information,” concludes Baltag.

New measures in the education bill é pre-school in kindergartens from

age 5 to 6 made compulsory é primary school will last between

6 and 10 years of age, gymnasium between 10 and 15. Out of the 4 high-school years, only 2 will be compulsory é the number of classes and the curricula will be axed by 25 percent in primary and secondary school é students undergo a national transcurricular evaluation centered on the 8 key competences acknowledged at EU level é school after school concept introduced é teaching staff will allot 25 percent of the time for teaching a discipline to adapting the method to child’s needs é universities will be split into 3 categories: those that offer bachelor’s degree, those that offer bachelor’s and master’s degree and those that offer bachelor’s degrees, master’s degree and PhDs.



Wind of change blows through regulations for renewable energy power plants The new support scheme for renewable energy power plants – fully developed by the new Law 220/2008 – includes some significant positive changes. Law firms such as Tuca Zbarcea & Asociatii, Salans and DLA Piper have analyzed for Business Review the pluses, the minuses and the things which should have been revised in order to make the market more stable and trustworthy for investors. The new law is estimated to be published in DANA CIURARU

the Official Registry in mid-July. Dana Ciuraru Blue skies thinking: players hope that renewable energy will give a boost to Romania’s economy

Positive changes in the renewable energy support scheme law Irina Moinescu, managing associate with Tuca Zbarcea & Asociatii, which was directly involved in editing the amendments to Law 220/2008, and Ramona Volciuc-Ionescu, senior associate at DLA Piper, say that establishing annual quotas for renewable ener gy leads makes the market much more stable. é Mandatory annual quotas of electricity produced from renewable sources that benefit from the support scheme were increased, as follows: 2010: 8.3 percent, 2011: 10 percent, 2012: 12 percent, 2013: 14 percent, 2014: 15 percent , 2015: 16 percent, 2016: 17 percent, 2017: 18 percent, 2018: 19 percent, 2019: 19.5 percent, 2020: 20 percent. é Allotting 3 green certificates (instead of 1) for each 1 MWh produced and delivered by the new hydropower plants, and 2 green certificates (instead of one) for each 1 MWh produced and delivered in the refurbished units é Extending the support scheme for electricity from wind with 2 green certificates by 2017 and 1 certificate starting 2018. é Allotting 6 green certificates (instead of 4) for each 1 MWh produced and delivered by ener gy producers from solar sources. é Indexing the green certificate trading value with the inflation rate from the EU 27 published by Eurostat. é Increasing the penalties paid by sup14

pliers for each green certificate not acquired from EUR 70 to EUR 1 10, a sum also indexed with the inflation rate in the EU 27, published by Eurostat. é Defining and using unitary notions in the law (such as compulsory annual quota of green certificate acquisition, mandatory annual quota of electricity produced from renewable sources which will benefit from the support scheme), to avoid confusion generated previously, both for investors and banks, by the unclear terminology. é The producers can qualify step-bystep the ener gy capacities in order to apply the support scheme. é Setting extra guarantees for renewable energy producers in case the ener gy transport operator or distributors want to take measures to limit the use of renewable energy sources. Thus, these limitations may be imposed only to ensure the security of the grid. é Integrating into the national law of the stipulations the Directive no. 2009/28/CE of the European Parliament and the Council of 23 April 2009 on promoting renewable ener gy use, and subsequently amending repealing Directives 2001/77/EC and 2003/30/EC, published in the Of ficial Journal of the European Union no. L140 of June 5, 2009, relating to transfer statistical amounts of electricity from renewable sources by another

member state, as well as joint projects with other EU or non-member countries on the production of electricity from renewable energy sources. é To eliminate the risk of using old equipment in generating ener gy from renewable sources, the law set the new power plant definition, under which a new power plant is the one put into operation after January 1, 2004, composed entirely of new equipment. é Furthermore, isolated power plants will benefit from green certificates encouraging the installation of renewable energy for those units not connected to the grid. é The minimum price of EUR 27 and the maximum price of EUR 55 per certificate will be applied by 2025 and starting from 201 1, the annual price will be indexed with the EU 27 average inflation rate recorded in December the previous year by the National Energy Regulatory Agency (ANRE). é Equal sharing of the connection costs between producers and system operator and distributors, if necessary. “An im portant m odification refers to the fact that the L aw 220 sets a clear period for the schem e’s a vailability (including after 2025), w hich contributes to the increase of investors’ confidence in the system’s stability,” Claudiu Munteanu-Jipescu, partner with Salans, told BR. BUSINESS REVIEW / June 21 - 27, 2010


Aspects not changed in the new law


Ramona Volciuc-Ionescu, senior associate at DLA Piper


Claudiu Munteanu-Jipescu, partner with Salans

The Tuca Zbarcea & Asociatii managing associate and the DLA Piper senior associate say that among the aspects of the law which were not modified although it would have been beneficial for investors is the fact that the losses of green ener gy through the national grid are supported by the investors. é The main problem is that banks who are requested to finance the projects do not have the certainty that the green certificates issued to a producer will be entirely purchased in the future, as the excess of green certificates is not guaranteed to be bought. é Another problem which may arise comes from the rule according to which green certificates are issued to the producers for the amount of electricity produced and delivered to suppliers and/or final

consumers, this meaning that the producers will bear all ener gy losses in transmission / distribution networks, to the point of delivery . Unfortunately , the amendments proposed in order to fix this situation were not passed by Parliament. “The a mended la w stipula tes tha t the A NRE and the Ministry of Economy have to draft the secondary legislation in order to implement the suppor t schem e adopted by Law 220. Other measures discussed and expected by investors, and w hose implementation would promote investments in renewable energy investments, include the launch of the intraday market and adoption of special legislation on land expropriation and on construction of new tr ansmission lines,” Ramona Volciuc-Ionescu, senior a ssociate at DLA Piper, told B R.

Negative changes from the Law 220 which will lead to the real price collapse. A lthough the law sets a minimum of EUR 27 per certificate, it is unclear from what sources that minimum amount will be ensured. é An aspect that was cut from the law refers to the é The law requires ener gy possibility of granting addistributors to purchase ditional incentives to the the green ener gy at regurenewable energy produclated prices for the renewers – for example, state able ener gy producers guarantees for loans up to who have installed power 50 percent for medium- or plants with less than 1 long-term contracts, proMW, leaving an unclear viding financial contribusituation for producers tions to the state budget with installed capacity for new jobs created, etc. over 1 MW. However, this change was é Another unclear issue is imposed because these farelated to ensuring financcilities were likely to coning, if their market sees stitute state aid which green certificate inflation Ramona V olciuc-Ionescu and Claudiu MunteanuJipescu believe that there are a few changes in the new law which cannot be labeled as being in the best interest of the investor.

BUSINESS REVIEW / June 21 - 27, 2010

would have slowed the approval of the support scheme by the EC. é The amended law imposes some more burdensome obligations for electricity suppliers such as mandatory quotas applicable to the green certificates support scheme increasing gradually, reaching 20 percent by 2020. “A change that could be seen as nega tive by potentia l investors that were intending to use second ha nd equipm ent in their projects, is the one according to which the promotion system shall be applied, in case of electrical capacities pr eviously used in other countr ies (i.e. second

hand equipm ent), only f or 7 years a nd only if they a re used in isola ted sy stems not linked w ith the na tional grid and/or put into use bef ore the amendments to L aw no. 220/2008 but, in a ny ca se, not older tha n 10 y ears a nd also complying with environmental laws. The intention is obviously to protect the environment by using a dvanced technologies, but it a ffects those inv estors w ho ha ve planned to dev elop pr ojects using second-ha nd equipment and did not manage to commission them bef ore the enforcement of the a mendments to Law no. 220/2008,” Irina M oinescu, m anaging associate w ith Tuca Z barcea & A sociatii, told B R



Sun Plaza opens EUR 3 million subway connecting passage, new Cinema City

Medicover buys land for new EUR 50 mln hospital

Tiriac Auto revs up new Hyundai and Mitsubishi showroom


The hospital is planned to be the city’s largest

Medicover has recently completed the acquisition of the land to build a hospital in Bucharest, which the company says will be lar ger than the existing private hospitals in the capital. “After the opening of the Warsaw hospital it is the second largest project Medicover is undertaking in the coming period,” said Marina Otelea, general manager of the firm. Medicover is a private healthcare services provider active in Central and Eastern Europe. It has 6,000 corporate and 400,000 individual customers in Poland, Romania, Hungary , the Czech Republic, Slovakia, Germany , Ukraine and Estonia. In Romania the firm has over 70,000 subscribers from 1,500 companies. It has centers in Bucharest, Cluj Napoca, Constanta, Focsani, Iasi, Ploiesti and Timisoara. The company offers subscription-based and separate payment services within its own network and that of partner clinics which number 140 throughout the country. ■

Menswear firm Barotti sews up EUR 25,000 in new collection COURTESY OF TIRIAC AUTO

Tiriac Auto has opened its first joint Mitsubishi and Hyundai showroom in Bucharest through its companies M Car Distribution and Romcar Motors. The outlet is located in the Berceni neighborhood and covers a 1,200-sqm surface on two levels: ground floor and first floor. Company representatives say that the new location is part of the company’s plans to expand its network geographically , and is in an area with good visibility and traffic. At the same time, the showroom is situated close to the two Mitsubishi and Hyundai services in the area, thus offering customers specialized and standardized sale and post-sale services close by. The new showroom has separate reception areas for the twoAsian car brands, a playground for children and a specially designed area for the presentation of the Auto A vantaj


several small outlets such as a travel agency, a tailor ’s, an accessories store, p hotography p roducts a nd services and a book and newspaper stand among others. Sun Plaza, which includes a Cora hypermarket, a do-it-yourself Baumax outlet, a Mobexpert and a Flanco, was developed by EMCT , with financing from Sparkassen Immobilien AG. The mall’ s commercial center has 15 cinema halls, with a 3,000seat capacity in the Cinema City multiplex, a bowling and games club Oxygen spreading on a 2,000 sqm surface, and a Game World House of the rising Sun: the passage runs from Sun Plaza mall to the nearest metro station casino among other leisure facilities. Sun Plaza, the latest commercial tall, allowing for the safe crossing Sparkassen Immobilien had a center to begin trading in Bucharest, of the Oltenitei Road. It runs direct- portfolio of EUR 1,839 billion at has opened a EUR 3 million passage ly from the subway station and has end of March, and a total rentable connecting the mall to Piata Sudului two exits – one towards the southern space of 1,407,000 sqm in residensubway station. Along with the pas- part of Sun Plaza and the other in- tial, of fice, hotel, and commercial sage, the mall is also inaugurating a side the commercial center , in Blue properties in Austria, Germany , new Cinema City outlet. Plaza. the Czech Republic, Slovakia, The passage is 180 meters long, The passage hosts a commercial Croatia, Hungary , Bulgaria and six meters wide, and three meters gallery in the Sun Plaza area, with Romania. ■

The new Tiriac Auto showroom is located in the Berceni neighborhood

range, its own service center for selling new cars through the trade-in and buy back methods. The service has recently been implemented at a national level throughout the Tiriac Auto distribution and service network.

Tiriac Auto sells the following car brands: Mercedes-Benz, Dodge, Chrysler, Jeep, Mitsubishi, Land Rover, Jaguar, Ford and Hyundai. It has 14 dealers in its national network with over 65 mono- or multibrand locations. ■

With an investment of EUR 60,000, Romanian menswear brand Barotti opened its first store in Unirea Shopping Center in October 2009, and aims to open its second location in a Bucharest shopping mall, as well as a private location in the near future, but not necessarily in the capital.Moreover , Barotti has launched its new spring-summer collection and is aiming to increase business by 30 percent by the end of 2010, according to the company . The springsummer collection is the result of a EUR 25,000 investment and was launched in March. The firm says that the collection offers the latest trends in menswear. Corina Dumitrescu BUSINESS REVIEW / June 21 - 27, 2010


Green Lafarge flashes cash to stash ash


Lafarge has invested EUR 1 million in the system

Lafarge Ciment has announced a EUR 1 million investment in a new ash storage, loading and transport system at Electrocentrale Isalnita, a subsidiary of SC Complexul Energetic Craiova. The system was installed on the already existing ash silo which has been completely rehabilitated. The silo has a capacity of 210 tons of ash and features two pieces of modern loadin g equipment, making it possible to trans-

BUSINESS REVIEW / June 21 - 27, 2010

port the ash both by road and railway. “We plan to grow the segment of our operations that generate products with a low carbon print, as climate change and CO2 levels represent a constant concern for a responsible company such as Lafar ge. A high technological integration of alternative fuels and materials is a priority for all our cement factories,” said Sorin Bogdan, industrial manager of Lafarge Ciment Romania. This latest investment is estimated to reduce the amount of ash dumped by CET Isalnita and allow Lafarge to produce more environmentally-friendly cements. According to Lafar ge representatives, the outlay is part of the company’s EUR 90 million investment plan for 2006-2011. In the next two years the cement producer is planning other such projects so that the investment target is reached. Simona Bazavan



Seminar presents sales as a higher level of service Business Review and the Maastricht School of Management organized last week the Global Best Practices in Sales Management seminar led by Sandy Vaci, adjunct senior professor at Central European University’s Business School (MBA Studies), lecturing in transnational sales force management. 1





Simona Bazavan The economic recession is turning out to be a harsh wake up call for many companies. Customers have reduced their budgets and become more demanding while companies are facing cost cuts and the need for more flexible strategies. There turns out to be no place on global markets for inef ficiency. In this context, a company’s sales capacity becomes crucial. Now more than ever , companies must understand sales as a higher level of service, because excellent service is the best sales driver, according to Vaci. In the past 30 years he has amassed extensive international experience across 50 countries on four continents, working for companies like Procter & Gamble, Citibank, Raiffeisen International, Neilson/Cadbury and the Royal Bank of Scotland. He is currently also chairman of the supervisory board of the Credit Bank of Moscow and partner, Board Effectiveness Practice, at Leaders’ Den, a UK-based global consultancy. The one-day seminar, which gathered 65 company representatives, was intended as a training session on how to manage sales and sales people rather than on how to sell. It focused on international sales management practices and ways to improve sales efficiency by offering examples, templates and case studies from the presenter’s personal experience. The event will be followed by another one-day seminar held by Vaci this September. The Latest in Channel Innovation –A Practical Guide seminar will review international practices that focus on “owning relationships” instead of “owning assets”, to drive revenues with flexible, low-cost set ups. It will give practical guidance for their integration into existing set ups and detail execution issues and their solutions. For more information, please visit www


■ 1. Sandy Vaci, adjunct senior professor at Central European University’s Business School


(MBA Studies) ■ 2. The event offered networking opportunities for the attendees ■ 3. Vaci focused on international sales management practices that can easily be put into practice as a defensive solution against the effects of the current recession ■ 4. Global Best Practices in Sales Management gathered 65 company representatives ■ 5. The audience was made up of sales managers in national and international companies, entrepreneurs, general and middle managers BUSINESS REVIEW / June 21 - 27, 2010


Dacia goes pedal to the metal to buck reversing auto market

Dana Ciuraru After the solid results Dacia registered last year thanks to increasing exports – especially to Germany , which had a car renewal program in progress – Dacia officials have now found a new goose to lay it some golden eggs: the Duster. Salvation is taking the form of exports: some 20,000 orders came for the model from France in the first six weeks of its launch. Meanwhile, in Spain, the Mioveni-made brand sold 1,668 units last month alone, up 231 percent from the same period last year , according to the Spanish Car Importers Association. The car was launched on the local market on March 18, while in France it was presented to the public on April 8, with a starting price of EUR 11,900. “To ensure this price, we used existing components within the Renault-Nissan alliance, many made for the Sandero. For example, the 4x4 drive comes from Nissan 4X4 transmission. We avoided creating new spare parts, which allowed us to build a robust car at an unbeatable price,” said Vincent Carre, marketing manager at Dacia. Business Review has road-tested BUSINESS REVIEW / June 21 - 27, 2010

tors include the Fiat Panda, Hyundai i10, Smart for two and the new Toyota iQ.

Technical characteristics of the tested Duster 4x4 1.6 16v é Displacement: 1,598 cubic cen-


Despite the stalling local car market, Dacia keeps accelerating its sales, with the main engine for growth being the Duster and the increased demand from European markets the new model is enjoying.

Clean sweep: the Duster has enjoyed healthy sales on European markets

the vehicle between Bucharest and Ramnicu-Valcea, and has observed how the car behaves in the city , on the highway, on bends and off-road. The conclusion is that the car delivers a surprisingly good performance and fully merits its price tag, although before the road-test it seemed a little expensive. The model could reach at least last year ’s level in sales volume. In 2009 Dacia sold 31 1,282 units, a 20.5 percent increase on the previous year . Of this figure, 269,420 cars were sold in European countries and the rest on the local market. According to company information, Dacia invested EUR 290 million in developing the Duster model at its Mioveni factory , in the new gearbox and the Euro 4 and 5 motorizations. Of this sum, about EUR 70 million was invested in the factory. Moreover, Renault Technologie Roumanie (R TR) of ficials told BR that the test center in Titu will be finished in September this year, after a EUR 100 million investment. The facility joins test centers in Aubevoye and Lardy (France). “The Titu center will not mer ge the RTR teams in Bucharest and Mioveni, but complements them,

with the testing of vehicles and spare parts, which has not existed until now. By the end Titu will create about 300 new jobs,” Anca Oreviceanu, communication manager at RTR, told BR. She added that the Titu center will include test banks for complete vehicles and for components (engines, components, subassemblies). They will be able to recreate extreme operating conditions, with a testing facility for resistance to cold, a sun simulator and rain cabin. The company is not resting on its laurels and has continued focusing on its internal resources, with internal mobility being a goal. Also, the carmaker has announced that in order to keep costs under control it has recruited the necessary personnel for certain projects: entry-level positions, specialists and middle management. Currently, Renault Group in Romania has 17,478 employees, of whom 15,329 work at the Mioveni platform. Dacia’s plans do not stop here. According to foreign media reports, the carmaker intends to launch a new small class model at a price of less than EUR 5,000, which will be called Dacia City . Likely competi-

timeters é Power: 77kW/105PS/5750tr/min é Maximum torque: 148Nm/3750tr/min é Fuel: gasoline é Pollution level: Euro 5 é Gearbox: manual 6+1 levels é Consumption: complete: 8l/100km city: 10.4l/100km out-of-town: 7l/100km é Height: 210mm é Weight: 1250kg é Dimensions: L 4315 mm/l 2000 mm/h 1695 mm é Price for tested model including additional endowments: EUR 15,105 with VAT

BR test-drive summary Pluses: é Competitive price tag é Good stability é Massive aspect é Modern four wheel drive system é Generous interior space Minuses: é Relatively high fuel consumption é Gear shifts must be fast and therefore driving is slow in busy urban traffic é Similar board to other Dacia models 19


Luxury travel doesn’t lose its bling Hiring a personal travel planner isn’t

the economic downturn. In the worst case we estimate a turnover stagnation given the current economic context.

exactly a common occurrence for the average Romanian and extravagant

How ma ny cu stomers h ave y ou had in the last two years? Well, in 2008 we had just started the business and last year we had about 50 customers.

customized holidays would seem set to become more and more out of

Which was affected worse by the economic crisis, leisure or business travel, a nd w hat is th e ou tlook for 2010? Leisure travel was most definitely the worst hit. Customers who travel for work reasons learned to mix business with pleasure. The first half of 2010 has exceeded our expectations and although we expect a growth of the leisure segment in the second half of the year , given the current economic instability , we remain cautious.

reach to the majority. But ANCA NICHIFOR, managing director of Jet Set Planner, a local company offering personal travel planning services, told Business Review that there is an increasing demand for this type of service and the market is COURTESY OF JET SET PLANNER

expected to grow. Simona Bazavan How did you get the idea to start this company? The story is simple. Over the years, in all the companies I have worked for , I dealt with tourism, mainly or ganizing travel for others. For some of these trips the or ganization was quite demanding; unexpected situations were the rule and not the exception, turning everything into quite an “event”. And so I came to understand that there was a niche market in Romania for people who could use the help of a “personal travel planner”. In practice, such a planner combines the work of a personal assistant, a traditional travel agent, a concier ge and even the internet sometimes. What do y ou estima te to be th e value of the market for such services in Romania? I can’ t make such estimations as we don’t have any direct competitors that can offer the same services as we do. In this industry everything takes place in a decentralized manner and I don’t think that anyone keeps track of the value of these services. What I can say is that this is a growing market. 20

Is the “personal travel planner” concept accepted by Romanians? The concept is quite hard to accept as Romanians aren’ t used to such services. What is your customer profile and in what way is it different from that of a regular traveler? We mainly address two dif ferent customer categories. The first is individuals with a very high income who travel for business quite often and who need excellent service, flexibility and promptness when they plan their travel. These customers know exactly what they want and just need a very discreet someone who can fulfill their wishes. The second category is individuals with an average or above average income who want a dif ferent type of holiday, a c ustomized o ne. These people don’ t usually fly charter , aren’t fans of all-inclusive hotels or travel packages. Generally they are used to “building” their holiday on

their own with the help of the internet, spending many hours in front of the computer trying to find the best quality/price ratio. Usually they don’t make up their mind easily and need a wide variety of offers to choose from. How mu ch h ave y ou in vested since 2007 and what is your future investment strategy? The initial investment wasn’t very large; subsequently, after investing in acquiring a new headquarters, it reached approximately EUR 200,000. In the future we plan to invest mainly in promoting the concept of “personal travel planner”.

What were the most popular destinations last year? In Romania the most popular destinations were the Prahova Valley and Brasov, as well as Sibiu, Sighisoara and Bucovina. Abroad, we can’t really talk of very popular destinations. We had a lot of customers who traveled to European capitals, or spent the summer on the Cote d’Azur , Sardinia, Sicily, Capri and the Greek Islands where they rented holiday houses. How h ave lu xury tr avel pr ices been affected by the economic crisis? On the luxury segment we haven’t n oticed a ny d rastic p rice drops, moreover some European hotels posted higher rates. On the other hand, wherever it was possible, they had special of fers, not by cutting prices but by adding more value to the offered services.

What a re th e tr avel tr ends th is year? Most definitely this year , both in How did la st y ear’s t urnover Romania and abroad, on the midcompare to th e figu re in 2008 a nd range segment there has been great what a re y our estima tions for th is demand for special of fers or of fers with an “early booking” option. For year? luxury travel there haven’ t been any The company’ s 2009 turnover major changes, rather the trips are (EUR 350,000) registered a growth shorter or business travel is mixed of as much as 20 percent on the previous year. This is a good result for us with leisure. considering that 2009 was affected by BUSINESS REVIEW / June 21 - 27, 2010


Companies score World Cup financial victory despite Romania’s absence chance. Thus, potential clients can be turned into club regulars through allyou-can-drink of fers or other creative means of reward, such as free shots given for goals or penalty kicks, says the club’s coordinator. But Grand Cafe Van Gogh manager and owner, Jerry Van Schaik, has found that, so far, the World Cup matches have not brought a significant growth in sales, at least, not as much as the heat. During daytime, the scorching weather has scared of f customers, while the cooler evenings have drawn a significant influx onto the terraces. The slight consumption increase during football matches has not turned out to be generally significant. A considerable growth is however expected when the playof fs start, since, Van Schaik adds, the Van Gogh café is one of the only places in Bucharest that broadcasts matches with an English commentary. Special events, of fers and competitions are planned throughout the tournament, pretexts for creativity and originality, including “guess the score” contests, of fering various prizes to the winners. The international football extravaganza can also be regarded as a form of openness towards multiculturalism, encouraging customers to wear the symbols of the country that they support, Corina Dumitrescu and not necessarily their own, ar gues Van Schaik. Saturday, June 12 around 10 pm , The football and terrace exodus will Bucharest’s Lipscani area. Two friends are unsuccessfully striving to find a free also boost beverage consumption, both table in the city, greeted with refusals by soft and alcoholic. In order to encourage most of the pubs’ waiters and waitresses, this and therefore increase profits, terwho are holding out for lar ger, more race managers have come up with speprofitable groups of clients. It seems that cial offers. Mojo is offering all-you-candrink vouchers, while Van Gogh has crethe stifling weather has brought all of Bucharest out to the center ’s now insuf- ated a special menu of barbeque sauce ficient terraces – or was it the UK-USA ribs, which go well with beer. Coca-Cola, one of the competition’s match? Pub and terrace owners have difofficial sponsors, is aiming for a sales ferent opinions. Celebrating football fever, represen- boost through the usual promotions, ones that it has used previously on its tatives of Mojo Club say they have enconsumers: codes on the beverage’ s joyed an increase in sales of around 50 percent, a successful payoff for their in- caps can be sent via SMS or the internet, vestment in six plasma screens inside the with the possibility of winning prizes club and a video projector on the terrace. provided by other World Cup sponsors: Adidas and Sony . The biggest prize, “Not only have our sales increased, but we have also managed to attract a public however, sends the winner to Johannesburg, South Africa, where the World who was not familiar with our club,” says Mihai Paveliu, events coordinator Cup is taking place. Sony, as the official at Mojo Club. What’s more, the World partner of FIFA for the 2010 World Cup Cup matches are also an opportunity for in South Africa, is supporting the Football City project at Zone Arena, where making the club’ s services stand out from those of its competitors – the foot- matches will be displayed on a huge HD ball matches have thus become a pretext screen and smaller , 46-inch HD TVs, for bringing the services specific to Mo- with 3D TVs displaying short clips of jo to people’ s attention. The broadcast- the most recent matches. Although not a sponsor of the FIF A ing of matches can be used as a means of advertising, for gaining visibility to new 2010 Championship, Ber genbier, the clients who reach the location by Romanian national football team’s spon-

BUSINESS REVIEW / June 21 - 27, 2010


The old center in Bucharest is overflowing with terraces competing to broadcast World Cup football matches with ever wider LCD screens and higher-quality projectors. TVR 1, the national television station, has moved to the next level of technology, by offering the HD option for viewing matches. Sponsors of the global football tournament have also been preparing promotional campaigns. It’s clear the 2010 World Cup is still capturing the imagination of fans in Romania, despite the national side having failed to secure a place in South Africa.

Romanians enjoy the World Cup on a terrace

sor, has launched a comfort campaign for the country’ s football fans, with the aid of the team captain, Cristian Chivu. Its message is that although Romania is not taking part in the finals, beer can still be enjoyed with friends. Drinks companies are not, however, the only financial winners of the 19th FIFA World Cup. Betting companies are reporting that the number of visitors to their websites has doubled since the last tournament in 2006, mostly due to improved internet security, BetBrain representatives say. What’s more, since 2006, the number of clients has substantially increased due to the launch of Romanian sites for international betting services providers, such as Gamebookers, Bet365 and Bwin, say of ficials, a comparison service for odds supplied by betting companies. TVR, the Romanian television station broadcasting World Cup matches, has become audience leader during its match coverage. The highest ratings were reached during the UK-USA game on June 12, with a 6.9 average rating, with 9.6 as the audience peak during the Italy-Uruguay match. On the occasion of the tournament, TVR has launched HD services, as well as the possibility of watching football matches online. The site’s traf fic has reportedly tripled, reaching 45,000 visitors daily since the World Cup’ s debut. Moreover , for the first time in Romania, Telesport, another television channel, will broadcast eight of the football games live between June 22 and 25, along with another 44 prerecorded games. TVR was obliged by law to sublicense the right to broadcast World Cup Games and DigiTV, the Telesport operator , was the winner of the auction. Telesport is broadcast exclusively in the UPC and Romtelecom Dolce networks.

The 19th FIFA World Cup will end on July 11. The perspectives for profit that the competition of fers to all those involved in the games, ranging from sponsors to broadcasters, are enormous. Yet, so far , in Romania, commentators say there is still room for improvement, especially when it comes to the official sponsors of the competition, who have opted for predictable, conventional and not highly visible communication. Although Romanians are football lovers, if the national team had been taking part in the competition, local companies could have expected a much bigger payday . However, while waiting for another golden generation to live up to the legacy left by the likes of Romanian football royalty Gheor ghe Hagi, local football fans will have to settle with the next best thing, supporting their second favorite team.

World Cup 2010 – facts and figures é The mascot of this year ’s World

Cup is Zakumi, a 12-year-old leopard sporting the South African national team’s colors: green and gold; é The total organizing costs of the event reach an estimated USD 3.7 billion, almost half the sum invested by Germany in 2006 – USD 7.7 billion; é Around 3 million tickets are available for the 64 matches, one third of which have been allocated to South African football fans, a million tickets to international visitors and the final third to sponsors, teams and the so-called "FIFA family"; é The 64 matches involving the 32 participating teams will be contested in 10 newly built or recently modernized stadiums; é The reconstruction of Cape Town’s Green Point stadium took around 33 months, with a total cost of USD 60 million; é The vuvuzela, the instrument that television broadcasters wanted to ban due to the irksome noise it produces, originates in Mexico, in spite of its claimed links with African culture; é Since the beginning of the World Cup 2010, the South African authorities have reported numerous cases of theft, with victims including Greece’s national team, various journalists and tourists, in spite of the massive security effort. 21



Toy Story 3 find a new home for them, stash them in the attic, donate them to a nearby daycare centre or toss them in the trash. After a mix-up, the gang finds itself on the way to Sunnyside Daycare, a nursery school that seems too good to be true. Which of course it is – the toys are plunged into a Lord of the Flies style nightmare, and must bust their To a sequel and beyond! way out of their new prison. It’s Disney , so the premise is You know you’re getting on a bit simple, the characters not overly when films and songs that you think complex and the morality black and of as fairly recent turn out to be 15 white. But the movie is so much years old. Take Toy Story. Bunch of more than a trite tale for children. talking toys, the astronaut, the cow- Above the obvious kid-centered boy, to infinity and beyond, newfan- comedy is a cheeky layer of wry adult humor , much of it character gled computer animation, probably came out a few years ago. Nope – driven. A hilariously camp Ken is more appearance-obsessed than any 1995. Four years later came a sequel – Sex and the City fashionista, and there is a fabulous sequence in which did even better than the first which he parades his numerous one – and since then nothing. Maybe toys who come to life were a flamboyant outfits on an imaginary bit too old school for today’ s kids, catwalk. New character Mr Pricklepants brings a well observed thesraised to master iPods and iPlayers pian seriousness to his roles in simbefore they can use a knife and ple children’s games. And there are fork. also amusing allusions to the prison But, lest any cynic think that film genre, such as when one of the Disney is desperately dragging incarcerated toys plays plaintively some old stalwarts out of the archives to guarantee its execs a re- on a harmonica. A potential downside for foreign cession payday, Toy Story 3 is one of the best movies – not just anima- viewers is that rather than the subtitles that accompany live action tions – to come along for a very films, Toy Story 3 is dubbed. Howlong time. The visuals are a joy , and only ever, a smattering of Romanian is enough to grasp the basic plot, and helped by being rendered in 3D, even if you don’ t understand a putting you at the heart of the action. But the picture doesn’ t just re- word, the movie is sufficiently visuly on technical gimmickry . Tension al that you’ll still have a marvelous time. They may be only toys, and and drama abound, and you’ll find yourself caring more about these computer-generated ones at that, but if the average Hollywood producCG creations than you do about most human movie characters. At tion were even half as engaging as times action-thriller, at times know- the latest adventures of Woody and ing comedy, at times tear-jerker, the chums, it would be a vast improvement. film is immensely satisfying and carries the viewer with it, never flagging for a second. Debbie Stowe Respecting the c hronology of parts one and two, Toy Story 3 sees Director: Lee Unkrich Andy, child owner of Buzz, Woody Starring: (voices in English language version) Tom Hanks, and co, all grown up and about to head off to college. Clearing out his Tim Allen, Joan Cusack room and packing his stuff, Andy On at: : Cinema City Cotroceni, must decide what to do with his old Cinema City Sun Plaza, Samsung IMAX, Cityplex, The playthings: take them with him to Light college for the sake of nostalgia, 22

Classical strains to soothe Bucharest brows on torrid summer nights

The weekend concerts take place downtown

Classical music festival Summer Symphonies’ Dream is taking place in downtown Bucharest, in Coltea Park, every weekend between May 8 and October 3. String and voice groups and artists will take to the stage, playing Mozart, Beethoven and Brahms, among others. Concerts will take place every Saturday and Sunday , between 19.30 and 21.00. Attendance is free of char ge. Coltea Park is situated outside the Universitate under ground passage, at the Spitalul Coltea exit. More information is available at: Corina Dumitrescu

Unearthed ancient cave drawings in Romania ‘oldest in Central Europe’ Romanian-French researchers have discovered 35,000-year -old cave paintings in the Apuseni Mountains. This recent discovery makes the rupestral drawings in Coliboaia cave the oldest in Central Europe. The drawings include representations of a horse, a buf falo, bear heads and even rhinoceroses. “This is a first for Central Europe. It is the oldest form of art discovered and confirmed in this area,” said Romanian Federation of Speleology officials. The Coliboaia site can be reached from the village of Sighisel, close to

Ancient cave representations

Beius. The cave is about 750 meters in length and has numerous obstacles along the way, which make the site very difficult to cross. Corina Dumitrescu

Exhibition commemorates 20 years from Mineriad The University passage in downtown Bucharest is hosting an exhibition in memory of the victims of the violent street insurgencies that occurred in 1990 in the capital. On the Spot Findings draws attention to the violence and oppression to which the Romanian postcommunist state subjected its own people. It is on show until June 27. Between June 13 and 15 1990, thousands of coal miners from Valea Jiului

were called to Bucharest by the authorities to crush anti-regime demonstrations. They created chaos, ravaging the city , beating, arresting, raping and aggressing hundreds of students, professors, opponents of the political regime, Rroma and simple passers-by. Even now, 20 years after the tragic events, the Romanian authorities have not issued an of ficial explanation for the carnage. Corina Dumitrescu

Bucharest cultural institutes go nocturnal on June 25 Already a tradition on Bucharest city’s entertainment scene, Cultural Institutes’ Night will take place on June 25. The night will consist of events organized by the British Council, Czech Centre, Goethe Institute, Cervantes Institute, Polish and French Institutes, among others. The institutes will open their doors to art lovers and the curious, or ganizing free-of-charge events, including movie

projections, play stagings, book readings, photography exhibitions, workshops, discussions, traditional food tasting, as well as many other innovative surprises. This year , the Cultural Institutes’ Night will be organized by the Polish Institute and will consist of 70 events, which will amount to a total of 16 hours in 11 venues. Corina Dumitrescu BUSINESS REVIEW / June 21 - 27, 2010

Business Review No.23, June 21-27  

Football fever fills local firms’ cup As the world’s footballing elite do battle in South Africa, local terraces, drinks firms and betting...

Business Review No.23, June 21-27  

Football fever fills local firms’ cup As the world’s footballing elite do battle in South Africa, local terraces, drinks firms and betting...