Transcript Romania Romanians at JMU Oana & Daniel 20 Feb 2004

Romania
By Romanians at JMU
Oana & Daniel
20 Feb 2004
1
Romania in Europe



Romania is a country in the Eastern part of Europe.
Population 22.4 million
National Currency : LEU
To the East, it is bordered by the Black Sea. Its
neighbors are:
To the South: Bulgaria
To the West: Serbia and Hungary
To the North: Ukraine
To the East: Moldova
Romania spans a total surface of 237,500 square
kms. (roughly 91,800 sq.miles). Picture it to be about
the size of Oregon.
2
Romania in Europe
3
Some geography

Our country is blessed with all
the major forms of landscape:
The Carpathian Mountains
(maximum height 2535 m, 8300
ft) cross the country from the
north to the south-west.
To the west of the Carpathians
lies a large plateau.
To the East and South there are
extended low plains fit for
agriculture.

The Danube flows along the
southern border with Bulgaria
and into the Black sea
forming a magnificent delta.
4
Romanian Ancient History
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In the 7th and 6th Centuries B.C., the
Greeks founded a number of colonies on the
Black Sea shore: Histria, Tomis and Callatis
(now the modern Constanta and
Mangalia).Herodot was the first to mention the
native inhabitants of the land: the Dacians.
Five centuries, the Dacians were united for
the first time under the authority of a wise
ruler called Burebista. He founded a capital city
in the heights of the Carpathian Mountains.
The new city - Sarmizegetusa - was well organized and defended by powerful
fortresses.
Meanwhile, the legendary richness of the
country made it a temptation for the Roman
Empire. During the two centuries of Roman
Occupation, new roads and cities were built in
Dacia. The official language was Latin,
from which the present Romanian language
was born. The Romans retreated from Dacia in
271 A.D.
5
Romanian Medieval History
TRANSILVANYA
 Region ruled by leaders obeying the
authority of the Hungarian King.
German colonization of Transylvania
began in 1141 A.D
 Germans build great cities such as
Sighisoara, Sibiu, Brasov, developed
strong guilds and boosted trade.
WALLACHIA
 Wallachia's history is entirely
centered on its resisting the Turkish
occupation. Wallachia was never
fully conquered, despite the
enormous military power of the
Turks.
MOLDOVA
 The Eastern kingdom, Moldavia had
to fight not only against the Turks,
but also the cruel Tatars Polish and
Hungarians
Wallachia
6
Modern History
 The revolution of 1848 proclaimed the idea of one single
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nation.
In 1862 The United Principalities of Moldavia and
Wallachia became Romania and Bucharest was proclaimed
capital.
In 1918 the national Assemblies Transylvania (December
1st), decided to unite with Romania.
In 1922 King Ferdinand was crowned monarch of the New
Greater Romania
Romania joined Germany in attacking the Soviet Union in
1941.
In August 1944 king Michael put Romania on the Allied
side.
7
From Communism to Democracy
The Soviet Army kept the country under control and
a communist regime quickly came into power. By
1947 the king was forced to abdicate.
In 1948 Romania was proclaimed People’s Republic
People's revolt of December 1989 closes the
historical gap Romania lived in for 45 years and
opens a new page in Romania's contemporary
history
8
Economy - Overview:
Currency Romanian LEU
Romania began the transition from Communism in 1989 with a largely obsolete
industrial base and a pattern of output unsuited to the country's needs.

The country emerged in 2000 from a punishing three-year recession thanks to
strong demand in EU export markets. Despite the global slowdown in 2001-02,
strong domestic activity in construction, agriculture, and consumption have kept
growth above 4%.
 An IMF Standby Agreement, signed in 2001, has been accompanied by slow but
palpable gains in privatization, deficit reduction, and the curbing of inflation.
 GDP: purchasing power parity - $166 billion
 GDP - real growth rate: 4.5%
 GDP - per capita: purchasing power parity - $7,400
 GDP - composition by sector:
agriculture: 15%
industry: 35%
services: 50%
2002 data
9
Economy - overview:
Industries:
textiles and footwear, light machinery
and auto assembly, mining, timber,
construction materials, metallurgy,
chemicals, food processing,
petroleum refining
 Industrial production growth
rate: 6%
 Agriculture - products:
wheat, corn, barley, sugar beets,
sunflower seed, potatoes, grapes;
eggs, sheep
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Exports: $13.7 billion f.o.b.
Exports - commodities:
textiles and footwear, metals and metal
products, machinery and equipment,
minerals and fuels

Exports - partners:
63.8% to EU Member States
Italy 24.9%, Germany 15.6%, France
8.1%,

Imports: $16.7 billion f.o.b.
Imports - commodities:
machinery and equipment 23%, fuels
and minerals 12%, chemicals 9%, and
textile 19%
Imports - partners:
Italy 19.9%, Germany 15.2%, Russia
7.6%, France
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Debt - external: $13.7 billion
10
Inflation
The projected inflation rate for 2003
was 15%, and it was achieved.
 National Bank of Romania tries to keep
the exchange rates and inflation within
acceptable limits.
 When there is a high demand on the
market for a hard currency, NBR
intervenes by selling that currency from
the state monetary reserves

11
Industries in Romania

Automotive
 Electrical Equipment and Appliances
 Electronics
 Machinery and Industrial Equipment
12
DACIA PITESTI
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Pitesti Motor-Car plant was build in a record time of
just a year and a half. As of July 1, 1968 the
production of Dacia begun under Renault license.
The first model was a copy of Renault 8.
13
The new DACIA SUPER NOVA has a Renault
engine and gearbox.

BUCHAREST, July 2 (1999) - Romania takes another step to embellishing a patchy
privatization record when France's Renault returns acquire a stake in carmaker Dacia.
Renault begun a multi-million investment in its Romanian brand, Dacia.

Nova is the first car designed in Pitesti by Romanian experts.

Renault is planning to invest 565 million euros by the end of 2005 in order to produce
500,000 vehicles a year for export.

14
DAEWOO ROMANIA

technical level equal with the western
In November 1994, Daewoo established the production facilities in
Romania. The factory that produced the “OLCIT” model was bought
and upgraded to the western technical level. Daewoo became the
most important foreign investor of the country.
 DAEWOO AUTOMOBILE ROMANIA S.A. witch now has a yearly
production capacity of 100,000 units, produces both for the Romanian
market and for the export to nearby countries.

15
ARO – OFF ROAD
Different versions of ARO powered by:
Andoria (Turbo Diesel )
Toyota (Turbo Diesel )
Renault Megane (Turbo Diesel )
Toyota ( Gasoline )
Price range: 8,000 – 14,000 USD
16
Roman Brasov – Truck Division

These vehicles are all wheel drive (6x6 formula) and
are created for transport in areas difficult to access.
17
ROCAR
The export activity started in 1968, with great success.
 Today, ROCAR has modern equipment and assembly lines, with
business partners in countries like: Russia, Hungary, Bulgaria,
Columbia, Ecuador, Uruguay, Cuba, Chile.
 This bus is currently used in the surface transportation in the main
cities of Romania including the capital, Bucharest.

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Romania's leading manufacturer of refrigeration
appliances
ARCTIC 2000
Fridge-freezer
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General features:
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Appliance made of refrigerator and
freezer
Automatic defrosting of the cooling
compartment
Area for ice cubes tray of the freezer
Rounded (Soft) design, inside and outside
Different colors available
Manufactured according to the European
standards in force (performance, electric
safety) and observing the provisions of
the CE Regulations concerning the
energy efficiency and the
electromagnetic compatibility.
19
TURBOMECANICA builds Rolls-Royce Viper
Mk 632-41M turbojet.
The Soko J-22 Orao/Avioane IAR-93 is a joint
Yugoslav/Romanian design for a single seat close support ,
ground attack and tactical reconnaissance aircraft. It has a
secondary role as an interceptor.
 The power plant for these aircraft is based on the Rolls Royce
Viper 632 non-afterburning turbojet ofr Viper with
afterburner. 3
20

EU Enlargement

After successfully growing from 6 to 15 members, the European
Union is now preparing for its biggest enlargement ever in terms of
scope and diversity.

13 countries have applied to become new members:

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10 of these countries - Cyprus, the Czech Republic, Estonia, Hungary,
Latvia, Lithuania, Malta, Poland, the Slovak Republic, and Slovenia are set
to join on 1st May 2004. They are currently known by the term "acceding
countries".
Bulgaria and Romania hope to do so by 2007, while Turkey is not
currently negotiating its membership.
21
EU Map
22
The Monetary Union
12 Member States of the European
Union are participating in the common
currency. They are:Belgium, Germany,
Greece, Spain, France, Ireland, Italy,
Luxembourg, The Netherlands, Austria,
Portugal, Finland.
 Denmark, Sweden and the United
Kingdom are members of the
European Union but are not currently
participating in the single currency.

23
EU 'Copenhagen Criteria'
In order to join the European Union, the acceding countries need to
fulfill the economic and political conditions known as the
'Copenhagen criteria', according to which a prospective member
must:
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1.
2.
3.
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be a stable democracy, respecting human rights, the rule of law, and
the protection of minorities;
have a functioning market economy;
adopt the common rules, standards and policies that make up the
body of EU law.
The EU assists these countries in taking on EU laws, and provides
a range of financial assistance to improve their infrastructure and
economy.
24
EU-ROMANIA RELATIONS
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Romania is the first country of Central and Eastern Europe to have
official relations with the European Community: An agreement
including Romania in the community’s Generalized System of
Preferences in 1974 and an Agreement on Industrial Products in 1980
are signed.
Romania’s diplomatic relations with the European Union date from
1990.
Following Romania’s return to democracy, a Trade and Co-operation
Agreement is signed 1991. The Europe Agreement enters into force on
February 1, 1995, trade provisions having entered into force in 1993
through an "Interim Agreement".
Romania submits its application for EU membership on June 22, 1995.
25
EU-ROMANIA RELATIONS

In July 1997, the Commission publishes an "Opinion on
Romania’s Application for Membership of the European Union".
In the following year, a Regular Report on Romania’s Progress
Towards Accession" is produced.

In its second "Regular Report" on Romania published in October
1999, the Commission recommends starting the accession
negotiations with Romania conditional, among others, on the
improvement of the situation of children in institutional care and
the drafting of a medium-term economic strategy.

Following the European Council’s decision in December 1999’s
Helsinki summit, EU accession negotiations are started with
Romania on February 15, 2000
26
EU-ROMANIA RELATIONS
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At the end of 2001, accession negotiations on nine
(Company law , Fisheries, Statistics, SMEs,Science
and research,Education and training, Consumers and
health protection, External relations and CFSP ) of
the 31 acquis chapters are already provisionally
closed; negotiations on eight of them are being
processed
Thus, presently Romania has 30 chapters opened out
of which 19 were provisionally closed.
Romania’s aim is to gain EU membership
in 2007.
27
Anticipated Gains for Romania
When Entering EU
Pre-accession funds
 Foreign investment
 Free circulation of goods, labor, capital
 Economic stability
 Political security

28
Pre-accession Aid
From 2000 onwards, the EU’s pre-accession aid to Romania is provided by
three main instruments:

the Phare Programme, providing funding for institution-building and
investment in support of EU accession preparations;
 ISPA (the pre-accession instrument providing investments in transport
and environmental infrastructure) - €208-270 million for the period
2000-2006; and
 SAPARD (the financial instrument supporting agriculture and rural
development) - €153 million for the period 2000 – 2006.
The total volume of pre-accession assistance available to Romania is
substantial (at least €630 million per year in total from the three
instruments). This represents a very important financial resource for
Romania, equal to around 6% of the annual consolidated Romanian
national budget revenues, and up to 25% of investment expenditure
under the national budget.
29
Countries Classification on Foreign Investment Capital
Registered at September 30, 2002
RANK
EU
US
66..03%
8.12%
COUNTRY
TOTAL amount of subscribed capital number of companies
in foreign currency equivalent with foreign capital
1
TOTAL, of which:
Netherlands
Thousand USD
8614498.5
1581326.3
%
100.00
18.36
Number
87933
1522
%
100.00
1.73
2
Germany
834565.6
9.69
10046
11.42
3
4
5
USA
France
Austria
699532.3
648453.1
566203.9
8.12
7.53
6.57
3433
2743
2451
3.90
3.12
2.79
6
Italy
529406.0
6.15
12040
13.69
7 Netherlands Antilles
Cyprus
8
UK
9
Turkey
10
473236.0
422426.4
273479.8
5.49
4.90
3.17
7
990
1441
***
1.13
1.64
270599.7
3.14
8052
9.16
11
Greece
259738.4
3.02
2285
2.60
12
13
14
Republic of Korea
Hungary
Switzerland
242538.0
212159.2
204112.9
2.82
2.46
2.37
75
3868
1122
0.09
4.40
1.28
15
Luxembourg
157189.1
1.82
191
0.22
16
17
18
Spain
Portugal
Sweden
142169.0
113656.0
104547.6
1.65
1.32
1.21
486
73
726
0.55
0.08
0.83
19 British Virgin Islands
87069.3
1.01
159
0.18
No citizenship
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Canada
21
Syrian
Arab
Republic
22
Belgium
23
73785.8
67682.9
54147.7
0.86
0.79
0.63
21
809
5138
0.02
0.92
5.84
51778.6
0.60
1040
1.18
China
51708.4
0.60
7969
9.06
Liechtenstein
44540.0
0.52
144
*** Less than 0.01 Source: The National Trade Register Office
0.16
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25
30
Free Circulation of Goods,
Labor, Capital
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Free circulation of goods:
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Free circulation of labor:
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Romanian producers will have access on
standardized EU markets at competitive prices
– no customs, cheaper labor
Romanian labor force outflow can produce
income inflow back home
Free circulation of capital:

Increased business opportunities for private
parties
31
Economic Stability

Romania will have to meet the Maastricht
Criteria which will lead to stability through:
interest rates & price stability (limits inflation),
 public budget deficit (3% of GDP),
 national debt (60% of GDP),
 exchange rates (fluctuation limits guided EMS)


Romania will enjoy the same statute as
the older European democracies
32
Political Security

Romania will be officially a part of “The
Great European Family”, a statute that
will ensure national border security.

The current EU political system is
proven to work (even if it is in a
continuous process of adjustment).
33
Drawbacks 
Not too many for Romania
Forced economic specialization
Agriculture specialization in specific products/areas
(eg. Poland)
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Loss of national entity
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Some argue that the EU represents a dilution of the
individual country's national characteristics.
Replacement of national currency with EURO.
Romanian economy will have to comply with
new higher quality standards of production,
meaning high re-industrialization cost.
34
What If ?!

Joining EU – An irreversible process
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The approximation of national legislation with the acquis
communautaire is also a prerequisite for the advance in
accession negotiations.
The approximation is an irreversible process and
practically means that Romania gives up its legislation to
adopt another one and the institutions that come with it.
The adoption of EU’s standards in industry, agriculture
even statistics
No other choice
35
How the Average Romanian
Will Be Affected?

Higher standard of living

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Romania will have to comply to higher EU
norms, regulating healthcare, education, etc
More opportunities abroad:
Employment
 Travel – tourists inflow and outflow will
increase

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Access to larger range of products on
the Romanian market for the average
consumer
36
Questions ?
Thank You.
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