The main advantages of the area are the well-trained workforce, the proximity to the West and the very good economic base that puts the region among the top regions in the country.
Moreover, Timisoara can become the first gateway into regional expansion of Romanian companies, not just through exports but through buying or building businesses in other countries.
These are some of the most important idea of the `Romania 100 de ani de business’ (Romania 100 years of business) conference organized in Timisoara on Thursday by ZF together with Banca Transilvania and advisory firm EY Romania.
“I see Timisoara-Arad as a regional hub. It is only a matter of time before people from around the area will be coming here. We’re having internal migration for the time being, Timis-registered cars are becoming a minority,” said Catalin Olteanu-Heel, technical and investment general manager of sanitation service company Retim Ecologic Service in Timisoara.
“In time, the development of the businesses and the growth of the local economy will encourage foreigners to come here. 150 years ago, we had Italian migration. I think Timisoara and Arad will have a joint metropolitan area and I believe the future of Timisoara will be in this economic union with Arad.”
Timis County is Romania’s second most important business hub, as the revenue of the companies registered in this country stood at 62 billion lei in 2017, Trade Register data show. In all, the revenue of all companies in Romania stood at RON1,400 billion (EUR304 billion) last year.
Florin Vasilica, partner and head of transaction advisory services with audit and advisory firm EY Romania, explains that Timisoara and Timis County for that matter have grown so far relying on their very good geographical location. The city is near Romania’s western border, very close to Germany, which attracted investors from that country and the workforce is skilled, much higher skilled than in the other areas of the country.
“However, it is time for companies to think more and bigger. And I don’t mean just exports here, but regional expansion. You are very close to Serbia, Hungary and Austria, so you can expand in this region much easier than companies in Bucharest or other cities of the country. The biggest challenge of the entrepreneurs in Timisoara is to build regional companies on the solid base they have at the moment,” Florin Vasilica said.
Local managers are saying it is time for Romanian entrepreneurs to expand to foreign markets, using the model of other countries in the region such as Poland and Czech Republic, build plants or buy businesses in the region. And entrepreneurs in Timis County can more easily reach other markets.
Timis County ranks second by GDP, RON41 billion, according to the latest figures from Romania’s National Forecasting Commission. The GDP in Bucharest stands at more than RON211 billion. Very close to Timis are Cluj (RON38 billion) and Prahova (RON33 billion). Arad County, on the other hand, had an almost RON19 billion GDP last year.
Omer Tetik, CEO of Banca Transilvania says one of the strong suits of Timisoara that will help the area develop over the coming years is that it does not rely only on a single economic activity but has automotive component and food plants, is developing its agriculture, retail and winegrowing.
“I hope the biggest exporting county would go abroad, become an exporter of businesses because this will give entrepreneurs access to new markets, as well as new resources (…).”
Successful entrepreneurs in Romania stand a big chance of developing businesses abroad. It does not have to be a global development, but maybe in only one other country, Tetik added, saying he sees Timisoara as a gateway into other markets and for promoting the country.
The development of the county has mostly been driven by multinational companies in the last few years, especially those in the automotive component sector, with entrepreneurs contributing less than 45% of the revenue of Timis. Managers here say the Timisoara entrepreneurs could grow if they relied on quality products and expanded abroad.
“I would like to see more and more companies, start-ups, people who come up with global products and services. The game is global, not local. And, on the other hand, have investors come and fund these ideas or startups,” said Horatiu Moldovan, founder and manager of Lasting System, one of the largest IT&C distribution companies in Romania.
(English version by Loredana Fratila-Cristescu)