Nokia turnover exceeds 1 bln euros in Romania

ROMANIAN ECONOMIC HIGHLIGHTS, July 5, 2010. Nokia, the largest producer of mobile phones in the world has seen its turnover rise more than twofold in Romania to 1.027 billion euros amid rising number of employees and increasing production of the plant based in the Cluj county (central Romania). The Nokia plant in Cluj, counting 4,000 employees entered last year the ranking of the top 10 Romanian companies, the most spectacular advance reported by a local company. The company has increased its net profit that surged to 37.6 million euros last year from 13.9 million euros in 2008. Due to the boom recorded last year by the Nokia business, the company entered the ranking of the largest IT&C companies in Romania by turnover right after Orange (1.04 billion euros) and before Vodafone (929 million euros). Export is essential to explaining the size reached by Nokia in Romania, as in Renault group's case. Had these companies focused on the Romanian market only, the results would have probably stayed at one tenth of what they are now," Aurelian Dochia, economic and financial consultant and marketing partner of Concept Consult explained for the Ziarul financiar daily. Both Nokia and Renault have strongly bet on the foreign markets, thus managing to preserve their upward trend in a year when Romania’s economy fell 7 percent, with the two companies collectively accounting for over 10 percent of Romania’s exports in 2009. Some 10 million mobile phones were produced over February-May at the Nokia plant located in the Jucu village. The made-in-Romania phones are sold throughout Europe and Asia, with Nokia’s activity in Romania relating to the assembly and export of mobile phones.

According to the data published by the National Office of the Trade Registry, at the end of May 2010, there were 169,382 companies registered in Romania with foreign participation in social capital, total foreign investment amounting to EUR 27.14 billion. The top of the first five foreign investors was led by the Netherlands, with 3,747 companies registered and total invested capital of EUR 4.57 billion, followed by Austria with 5,829 companies and a total investment of EUR 3.95 billion, Germany with 17,865 companies and a total investment of EUR 3.87, France with 6,333 companies and an investment of EUR 2.02 billion, and Greece with 4,846 registered companies and a total investment reaching EUR 1.78 billion.

Voestalpine steel component plant sited in Giurgiu

Agerpres, Romanian Economic Highlights, May 25. Austria’s Voestalpine announced that it would start this week construction works on a steel component plant in Giurgiu (south of Bucharest). "We went all this difficult way, but now we can say that on May 26 we are expecting in Giurgiu an advisor to the Austrian Embassy in Bucharest to kick-start the construction of the plant,” Giurgiu mayor Lucian Iliescu on May 18 told a press conference. He added that the plant is expected to be commissioned in 12 months. "For me it is a reason of great satisfaction to have this industrial objective here and be able to say that with the help of this partner we succeeded in forgetting about the crisis and financial bottlenecks,” Lucian Iliescu completed. The Giurgiu mayor said that other investments will follow, that will boost the economic development of the region, because the Port of Giurgiu is a "foothold in the attention of Central Europe for freighting between Europe and Asia. Voestalpine’s investment in Giurgiu will be of roughly 19 million euros, of which 5 million euros will be provided through co-financing by the Government of Romania. The plant that will produce steel components for the automotive and home appliance industry will be built on a plot of approximately 40,000 square meters that belongs to the former chemical plant Giurgiu and will initially generate approximately 120 jobs.

11 million euros invested in Romania's biggest industrial mill

Agerpres, Romanian Economic Highlights, May 10. The ATON Transilvania group of companies on May 4 inaugurated the biggest industrial mill in Romania at Carani, Timis County (western Romania), on an investment worth 11 million euros. "The Carani 5 Mill is currently the most important flour producer in western Romania, with a production capacity of 500 tonnes/24 hours. The 11-million-euro investment was supported under a SAPARD project of almost four million euros," general manager of the ATON Transilvania group of companies Paul Milata said on May 4, when the mill started working. According to executive manager of the Romanian-German Chamber of Commerce Marco Walde, the investment was made in one of the most important sectors in Romania. "We are dealing with an investment in an important sector for Romania, in agriculture, a sector with many problems, given the fact that food production was cut and imports outweigh exports, in a country that could meet its own demand and could be a net exporter," said Walde. According to statistics, Romania imported flour-milling products worth 120 million euros in 2008, while exports totaled only five million euros. Likewise, according to statistics, four million people are currently employed in agriculture in Romania, although statistics indicate that only 20 percent of them will be needed on a medium term. The flour produced by the Carani 5 Mill, which has a production capacity of 500 tonnes a day, and by the Carani 4 Mill, which has a production capacity of 120 tonnes a day, is primarily sold on the foreign market in the Middle East and the western countries. "There are demands for flour in Iraq, Afghanistan and Pakistan, in general in the conflict areas where we are holding negotiations for concluding contracts," said Milata. The ATON Transilvania group of companies currently has 20,000 hectares of farmland in western Romania, 15,000 of which are taken on lease and 5,000 hectares are its own, on which they grow wheat and maize. The managers of the company do not rule out the possibility to introduce rape and technical crops in the future. ATON GmbH, a German investment company, is made up of 12 companies working in three economic fields: technology, services and raw material supply. In Romania the German holding company took over the company Vital & Heyl in 2006, where it decided to start investing in a new six-storey unit with state-of-the-art technology. At present half of the business run by ATON Transilvania consists in agriculture and is made by five companies. ATON Transilvania has 550 employees, a third of whom work in agriculture.

Investment of 16 mln euros in new Baumit factory

The third dry mortar factory of Baumit Romania Co., part of Austrian group Schmid Industrie Holding, raised on a greenfield investment in excess of 16 million euros, will have a production capacity of 350,000 tons per year, Alfred Gsandtner, Baumit International manager announced on May 5, at the official launch of this unit. Construction material producer Baumit Romania is to attain in 2010, following the opening of Bolintin Deal factory, a market share of 30 percent on the segment of dry mortar. "The factory in Bolintin (close to Bucharest), the most modern in Central and Eastern Europe, is part of a total investment of 20 million euros including alongside the wet mortar section an office building. The output can become twice as much through the addition of a new production line at the moment when the construction materials market resumes its upward trend. At present, based on its three factories Bucharest - Militari, Teius Alba and Bolintin, Baumit Romania hold an overall production capacity of 650,000 tons per year," said Laurentiu Lupusor, Baumit Romania general manager. Baumit, the biggest supplier of thermal isolation for facades in Europe accounts in Romania for a market share of 22-25 percent on this segment, also taking into account the individuals who renovate their homes alone. "As regards the national rehabilitation project, the accent is laid first of all on price and not on quality, therefore on this segment the Baumit systems account for 15 percent, 200,000-300,000 square meters of renovated facades being covered with Baumit Romania products", Laurentiu Lupusor also said. Now in its 15th year of activity, with a turnover of some 31 million euros in 2009 and total investments of 35 million euros, Baumit Romania has 150 employees, of whom 25 in the new Bolintin unit. "We manifest a cautious optimism in 2010 as for sales. We estimate sales of dry mortar of 200,000 tons, of which 10,000-15,000 for export," stressed Lupusor.

This year's foreign investment targets in Romania

Agerpres, Romanian Economic Highlights, May 3. Energy, the automotive and wood processing industries are the main targets of foreign investors in Romania this year, reports daily Romania libera. Financial analysts estimate that overall, foreign direct investments this year could reach nearly 5 billion euros, in line with the level of the year before, yet half the 2008 peak. The newspaper reminds that the National Energy Regulatory Authority (ANRE) has granted the company Iberdrola Energie Romania, the local subsidiary of the Spanish energy company Iberdrola, the energy supply license effective for two years. Iberdrola opened an office in Bucharest in 2009 and announced plans to develop in Romania wind-powered electricity generation projects with 1,600 MW of capacity installed in over 50 locations in the south-eastern region of Dobrogea; Iberdrola already invested 300 million euros in the project and said that the total amount could reach two billion euros in a few years. The Czech utility group CEZ recently announced that it only needs the approval of the national power system’s operator Transelectrica to begin producing electricity at the wind turbines in Dobrogea. The CEZ wind farm project at Fantanele and Cogealac (south-east) has a total installed capacity of 600 MW, almost equal to a nuclear reactor of the Cernavoda plant. The construction of the Fantanele wind farm will be completed this September. The Czech group invested 1.1 billion euros in this project. Ford Romania this week kicked off production at its plant in Craiova (country south), thus switching from assembling the Transit Connect light commercial vehicle to effective automotive manufacturing. The Romanian plant will also begin this year producing the B-Max minivan. Of recent, three automotive manufacturers that are Ford's traditional suppliers have announced that they will open their own production facilities at the Craiova Industrial Park. The three are German company Kirchhoff Automotive, a manufacturer of body and chassis structures, Afmech NV - a company based in Genk, Belgium, which manufactures hydraulic equipment, and Rochling Automotive Italy – a manufacturer of plastic components for automobiles. Renault Technologie Roumanie (RTR) will debut its Titu-based Technical Centre on September 15, 2010, said Dacia Automobile CEO Jerome Olive. Construction works at the engineering hub, where part of the testing of the vehicles and mechanical components designed by Renault Group’s design offices will be performed, started in September 2008. The estimated value of the project, announced in 2006, is in excess of 450 million euros. Located on the site of a former 350 hectare-wide military air base, midway between Pitesti and Bucharest, the Titu Technical Centre will complement the activity of the centers in Aubevoye and Lardy (France), where Renault continues to invest. The Finnish company Tornator intends to buy 100,000 hectares of forest in the coming years, in an investment assessed at 300 million euros. Tornator was one of the top investors in 2009 and already owns more than 12,000 hectares of forest in Brasov County (center). Several investment funds have already begun buying woodland in Romania. According to daily Ziarul financiar, Austria’s Cascade Empire holds 11,000 hectares and Germany’s Nordcapital owns another 10,000 hectares. All in all, large-scale foreign landed property owners already have over 100,000 hectares in Romania. China Electric Equipments Company intends to invest in a 500 MW energy group at the Rovinari Power Complex (center southwest). The minimum total project value amounts to 400 million US dollars (300 million euros). U.S. oil and gas equipment producer Lufkin, one of Petrom’s suppliers, could invest 300 million dollars (230 million euros) in Romania, Minister of Economy Adriean Videanu announced in early March. The company is said to already have sought a location for its new factory near Ploiesti (country south). Turkey’s Kastamonu Entegre, owner in Romania of Prolemn, announced an investment of 100 million euros for the construction of a particle board (chipboard) plant in Reghin (Romania center), informs Ziarul financiar. Prolemn is the third largest investor in the market for wood semi-finished products, after Austria's Egger also invested several hundred million of euros last year. The latter also plans to invest this year another 40 million euros in a glue factory in Radauti (northern Romania). The two investors have practically broken the monopoly Kronospan was holding since early 2000, when it set up shop in Romania. ProLogis can boast the largest investment this year, 57 million euros in a capital contribution performed in January. The company is the world’s largest logistics and distribution operator and opened its first industrial park in Romania in 2007, in the southern community of Joita, close to the Bucharest-Pitesti highway. Romania has potential from all viewpoints to attract yet another car manufacturer, which would be the third here, and prospects and signals in this regard are quite promising, said president of the Automobile Manufacturers Association Constantin Stroe. According to him, the entry of a new carmaker on the market will not affect Dacia’s position, and Ford’s facility already offers a telling example, as its presence is stimulating the local automotive industry.