The statistical survey regarding foreign direct investment (FDI) was conducted by the National Bank of Romania and the National Institute of Statistics. The major goal of the statistical survey was to determine the FDI stock as of 31 December 2010 and the FDI flows during 2010 financial year into the resident direct investment enterprises.
1. FDI net flow in 2010 stood at:
EUR 2,220 million of which:
- EUR 1,824 million - equity stakes* (82.2 percent);
- EUR 396 million - net credit from foreign investors (17.8 percent).
2. FDI stock as of 31 December 2010 amounted to:
EUR 52,585 million, of which:
- EUR 35,529 million equity stakes, including reinvested earnings (67.6 percent);
- EUR 17,056 million net credit from foreign investors (32.4 percent).
2.1. FDI stock by main economic activity
By economic activity (according to NACE Rev. 2), the bulk of FDI went to manufacturing (32 percent of total), out of which the largest recipients were: oil processing, chemicals, rubber and plastic products (6.9 percent), metallurgy (5.3 percent), transport means (4.9 percent), food, beverages and tobacco (3.9 percent) and cement, glassware, ceramics (3.2 percent).
|
| FDI stock
as of 31 Dec. 2010
| of which tangible and intangible fixed assets |
|
| EUR million
| % of total FDI
| EUR million
| % of total FDI |
| TOTAL, of which:
| 52,585
| 100.0
| 24,309
| 46.2 |
| Industry, of which:
| 23,093
| 43.9
| 13,740
| 26.1 |
| Mining
| 2,388
| 4.5
| 2,066
| 3.9 |
| Manufacturing
| 16,840
| 32.0
| 9,576
| 18.2 |
| Electricity, heating, natural gas, water
| 3,865
| 7.4
| 2,098
| 4.0 |
| Financial intermediation and insurance
| 10,055
| 19.1
| 1,428
| 2.7 |
| Trade
| 6,519
| 12.4
| 3,394
| 6.5 |
| Construction and real estate transactions
| 4,746
| 9.0
| 2,367
| 4.5 |
| Information technology and communications
| 3,081
| 5.9
| 1,533
| 2.9 |
| Other
| 5,091
| 9.7
| 1,847
| 3.5 |
Apart from industry, activities that have also attracted significant FDI are financial intermediation and insurance (19.1 percent of total FDI stock), trade (12.4 percent), construction and real estate transactions (9 percent), and information technology and communications (5.9 percent).
Tangible and intangible fixed assets stood at EUR 24,309 million at end-2010 and held 46.2 percent of total FDI, thus leading to considerable foreign direct investment stability.
2.2. FDI stock by development region
From a territorial point of view, FDI went mainly to BUCHAREST-ILFOV region (62.2 percent). Other development regions benefiting from significant FDI inflows were: CENTER region (7.4 percent), SOUTH-MUNTENIA region (7.3 percent), WEST region (6.5 percent) and SOUTH-EAST region (6.3 percent).
|
| EUR million
| % of total FDI |
| TOTAL, of which:
| 52,585
| 100.0 |
| BUCHAREST-ILFOV
| 32,720
| 62.2 |
| CENTER
| 3,909
| 7.4 |
| SOUTH-MUNTENIA
| 3,816
| 7.3 |
| WEST
| 3,446
| 6.5 |
| SOUTH-EAST
| 3,290
| 6.3 |
| NORTH - WEST
| 2,232
| 4.2 |
| SOUTH - WEST - OLTENIA
| 1,928
| 3.7 |
| NORTH - EAST
| 1,244
| 2.4 |
2.3. FDI stock by country of origin
The distribution of FDI stock by country of origin took into account the country of origin of the direct holder of at least 10 percent in the share capital of resident FDI enterprises on an “immediate country basis”.
Top 5 countries by share of FDI stock as of 31 December 2010 were the Netherlands (20.7 percent of the FDI stock), Austria (17.8 percent), Germany (12.2 percent), France (8.3 percent), and Greece (5.7 percent), the same hierarchy recorded in 2009.
|
| EUR million
| % of total FDI |
| TOTAL, of which:
| 52,585
| 100.0 |
| The Netherlands
| 10,903
| 20.7 |
| Austria
| 9,346
| 17.8 |
| Germany
| 6,398
| 12.2 |
| France
| 4,384
| 8.3 |
| Greece
| 3,016
| 5.7 |
| Italy
| 2,808
| 5.3 |
| Cyprus
| 2,550
| 4.9 |
| Switzerland
| 2,021
| 3.8 |
| USA
| 1,349
| 2.6 |
| Spain
| 1,064
| 2.0 |
| Luxembourg
| 989
| 1.9 |
| Czech Republic
| 972
| 1.8 |
| Belgium
| 864
| 1.6 |
| Hungary
| 717
| 1.4 |
| United Kingdom
| 627
| 1.2 |
| Turkey
| 615
| 1.2 |
| Other *
| 3,962
| 7.6 |
* countries which invested less than EUR 500 million.
3. Types of FDI
The flow of equity stakes into FDI enterprises amounting to EUR 4,067 million is divided into greenfield, mergers and acquisitions and corporate development.
In 2010, out of the total FDI equity flow, 96.6 percent (EUR 3,928 million) went to corporate development, 2.3 percent (EUR 93 million) were destined to mergers and acquisitions and only 1.1 percent (EUR 46 million) to greenfield investment.
The accumulation of foreign direct investment in enterprises established as greenfield investment companies, called greenfield enterprises, was highlighted in order to assess the lasting impact of greenfield investment on the economy.
The distribution of FDI stock in greenfield enterprises by main economic activity at end-2010 was as follows:
|
| TOTAL FDI
| of which:
Foreign direct investment in greenfield enterprises |
|
| EUR million
| EUR million
| % in FDI by
economic activity |
|
| 1
| 2
| 3 = 2/1*100 |
| TOTAL, of which:
| 52,585
| 25,179
| 47.9 |
| Industry, of which:
| 23,093
| 8,042
| 34.8 |
| Mining
| 2,388
| 381
| 16.0 |
| Manufacturing
| 16,840
| 7,300
| 43.3 |
| Electricity, heating, natural gas, water
| 3,865
| 361
| 9.3 |
| Financial intermediation and insurance
| 10,055
| 3,569
| 35.5 |
| Trade
| 6,519
| 5,336
| 81.9 |
| Construction and real estate transactions
| 4,746
| 2,899
| 61.1 |
| Information technology and communications
| 3,081
| 1,995
| 64.8 |
| Other
| 5,091
| 3,338
| 65.6 |
4. Exports and imports of FDI enterprises
The activity of direct investment enterprises as a whole had a positive impact on Romania’s foreign trade, its contribution to total exports and total imports standing at 72.4 percent and 62.5 percent respectively.
EUR million
|
| Exports (FOB)
| Imports (CIF) |
|
| FDI enterprises
| % of total exports
| FDI enterprises
| % of total imports |
| TOTAL, of which:
| 25,950
| 72.4
| 28,181
| 62.5 |
| Industry, of which:
| 22,887
| 63.8
| 19,923
| 44.2 |
| Manufacturing
| 21,934
| 61.2
| 18,849
| 41.8 |
| Trade
| 2,495
| 7.0
| 7,138
| 15.8 |
| Other
| 568
| 1.6
| 1,120
| 2.5 |
NOTE: Exports and imports are aggregated by the activity of companies, according to NACE Rev. 2 excluding exports and imports of NACE divisions (release 2): 84 Public administration, 97/98 Household activities and 99 Extraterritorial activities.
METHODOLOGICAL NOTES
The FDI 2010 survey was compiled based on the IMF Balance of Payments Manual, 5th edition (BPM5).
- Foreign direct investment: long-term investment relationship between a resident and a non-resident entity; it usually involves a significant degree of influence exerted by the investor on the management of the direct investment enterprise in which he has invested.
Foreign direct investment includes the following: paid-up capital and the reserves related to a non-resident investor holding at least 10 percent of the subscribed share capital of a resident enterprise, the loans between the investor or the group to which the investor belongs and the direct investment enterprise as well as the reinvested earnings.
Equity in a resident enterprise on which a non-resident investor has indirect significant influence is also considered foreign direct investment. This includes equity in the resident subsidiaries and affiliates of a resident enterprise in which a non-resident investor holds at least 10 percent of subscribed share capital.
- Foreign direct investor: legal entity, individual or group of related entities holding at least 10 percent of the subscribed share capital (or of endowment capital in case of unincorporated entities) or at least 10 percent of the voting power in an enterprise located outside the country of residence.
- Direct investment enterprise: an incorporated or unincorporated resident enterprise in which a non-resident investor holds at least 10 percent of the subscribed share capital or the voting power, or the endowment capital in case of unincorporated entities (branches). A participation of at least 10 percent in the subscribed share capital or the voting power, or in the endowment capital, is the prerequisite for the establishment of the direct investment relationship.
- Indirect direct investment enterprise: resident subsidiaries and affiliates of a direct investment enterprise.
- Reverse direct investment: the investment relationship opposite to the foreign direct investment between a resident direct investment enterprise and a foreign direct investor, where the former holds a participation of less than 10 percent in the share capital of the foreign direct investor.
- FDI components:
- Equity capital includes subscribed and paid-up capital, both in cash and through in-kind contributions, held by non-residents in resident enterprises, as well as the related share in reserves; in the case of branches, the available endowment capital shall be taken into account accordingly.
- Net credit, namely the direct investment enterprise’s borrowings from the foreign direct investor or the group of non-resident companies the former belongs to, net of the loans extended by the direct investment enterprise either to the foreign direct investor or to another entity within the group of companies.
- Types of FDI (by contribution to the equity flow in direct investment enterprises):
- Greenfield: establishment of enterprises by or together with foreign investors (ex nihilo investment);
- Mergers and acquisitions: partial or full takeovers of enterprises by foreign investors from residents;
- Corporate development: increase in foreign investors’ equity capital in direct investment enterprises.
Out of the total number of 43,000 FDI enterprises, 6,870 entities were surveyed (either by comprehensive or sample survey).
A number of 5,977 FDI enterprises were subject to a comprehensive survey, including enterprises with at least 20 employees (5,613 entities), all the credit institutions with foreign capital (38 entities), all the insurance companies with foreign capital (38 entities), as well as the enterprises referred to as atypical, namely all the foreign direct investment enterprises whose turnover or share capital was of at least RON 30 million, irrespective of the number of employees (288 entities).
A sample of 893 companies out of the 8,261 FDI enterprises with 5 to 19 employees was surveyed.
The corresponding FDI indicators for the about 28,700 FDI enterprises with 0 to 4 employees were calculated by applying the ratio of the turnover of these entities to the total turnover of FDI enterprises to the indicators compiled for the 6,870 surveyed companies, after grossing up data.
In addition, 572 indirect direct investment enterprises were also subject to a comprehensive survey.
The response rate of the FDI survey was 97.6 percent.
The final results of the FDI survey at end-2010 (flows and stocks) have an error margin of ±3 percent, a probability of 95 percent being warranted.
*increase in equity of EUR 4,067 million less the net loss which amounted to EUR 2,243 million.