The investment amounts to more than EUR100 million, EUR37.5 million of which should be state aid. The officials of the company did not return ZF’s calls for comment on the project.
The decision to build a washing machine plant from scratch in Romania comes at a difficult time for Turkey-Russia relations. The conflict between the two has escalated lately, but dates back to the end of November when Turkey shot down a Russian plane on the Syrian border. Moreover, the Russian economy is going through an extremely difficult time due to the EU and US sanctions and the slump in the oil price to less than $30 per barrel.
“Proximity to Russia and Turkey, the favorable geographic position for sales and the very-well trained workforce are what recommends Romania for a new investment in manufacturing,” believes Silviu Negut, Ph.D., Professor of geopolitics with the Bucharest University of Economic Studies.
“Romania could profit from the current geopolitical context in the future, as well and attract new production facilities.”
Russia and Ukraine generate only 3% of the about EUR13 billion revenue of the Arcelik group, so production on this market is mostly exported. In case Russia becomes isolated from the rest of the world, having a plant there stops making sense.
“I think it’s a decision made this summer, when the sanctions imposed to Russia made a serious impact on its economy,” explains political scientist Cristian Parvulescu.
“Arcelik may have anticipated Russia’s economic decline when it decided to move production to Romania. The local market is also more stable, geopolitics-wise.”
(English version by Loredana Fratila-Cristescu)