This might lead to the materialization of an expansion plan of IBM, considering the company was in talks with the authorities over state aid at the end of last year. The scheme would have played a definite role in the decision of the US giant to pick Romania out of list of countries it was evaluating for the opening of a service center staffed by up to 3,000.
One of the key managers of IBM in those talks was Lacramioara Isarescu, daughter of Romania’s central bank governor Mugur Isarescu. She is the manager for Romania of the company’s governmental programs. IBM officials could not be reached for comment by the time the story was ready for posting.
“We approve of this project that has been worked on for more than a year now, because it encourages creation of jobs for highly skilled employees. What I find limiting is the condition to create and keep 300 jobs for five years, because it is difficult even for an IT giant to make such a commitment,” said Andrei Pitis, chairman of the Software and Services Industry Business Owners (ANIS). “In addition, it does not encourage small Romanian companies, which are innovative in terms of technology and research and development.”
He explained that the new jobs may not translate into an increase in the number of employees, considering universities cannot meet the demand for IT skills on the labor market and the current IT&C specialists are already employed.
The main requirements to get the state aid are for investments to include an IT&C component of at least 20% of the investment plan and lead to creation of 300 jobs that the company will keep for five years. The companies operating in such sectors as coal mining, steel industry, naval construction and synthetic fibers business are not eligible.
“The project came as a result of the requests of the IT giants operating on the local market for state aid for the opening of service centers, outsourcing included, arguing that so far the Finance Ministry would only grant state aid to the software industry,” says a representative of the authorities who chose to remain nameless.
The financing agreements for the state aid schemes may be signed in 2012 and 2013 and the payment of the state aid will be made from 2013 through 2018, depending on the annual budget of the state aid scheme.
Other IT giants should benefit from this aid, too, such as Oracle, Dell and Ericsson, which were planning to create hundreds of new jobs in service centers, according to the former Communications Minister Valerian Vreme. The list might also include SAP, Samsung, Huawei, LG and ZTE.
The contribution of the company for the investment in form of taxes paid over five years should equal the state-aid requested. In other words, if a company invests EUR20 million, it will get a up to EUR10 million as advance money through the state aid scheme, which the authorities are to recoup from the taxes paid by that company over the next five years.
The total budget for the state aid support schemes is EUR100 million and granted through the budget of the Finance Ministry, which estimates about ten large companies will get it. A company may receive up to EUR28.135 million, and the cap for the Bucharest-Ilfov region is EUR22.5 million. The cap is lower in this region to encourage investors to go to less developed areas.
Traditionally, the best cities for IT&C investments are Bucharest, Cluj and Iasi, which are the university centers that can provide the necessary workforce for the new investments and the necessary infrastructure to build offices for the thousands of employees to be recruited.
IT colleges turn out about 6,000 to 7,000 graduates year, which is not enough to meet demand such skills; employers complain they are having more and more trouble finding programmers, as they are already employed.
The project published on the Finance Ministry’s website in the Decision-making transparency section is up for public debate until July 27. It will be discussed during the government session on Wednesday.
(English version by Loredana Fratila-Cristescu)