Capital Bucureşti
Time Zone EEST (GMT+2)
Country Code 40
Mobile Codes 71,72,73,74,75,76,77,78
ccTLD .ro
Currency Leu nou (1EUR = 4.1 RON)
Land Area 238,391 sq km
Population 22 million
Language Romanian
Major Religion Orthodox Christianity

Greek-Romanian Relations Flourishing amidst Crisis

By Ioannis Michaletos

Greece and Romania are increasing their economic ties, despite the severe economic crisis affecting both countries, by engaging in steady bilateral growth in trade, investments and capital flow.

In 2011 alone it is estimated that 200 Greek-owned businesses were established in Romania, especially the Bucharest metropolitan region. According to the Athens Chamber of Commerce, the economic depression that has hit Greece, with a cumulative drop in GDP of 20% since the crisis started, is prompting risk-averse business people to establish themselves in Romania.

Although the latter is also in the midst of a crisis, it has better growth potential, is located closer to expanding Central European consumer bases (Czech Republic, Slovakia and Poland), and also close to Ukraine and Russia.

The recent acceptance of the latter into the World Trade Organization will provide ample opportunities for the export of consumer products and services. The Greek Ministry for National Economy roughly estimates that 35,000 Romanian citizens are currently working in Greek companies in the country, some, previously immigrants to Greece who returned home to become managers and liaisons between their country and the Greek corporations.

In a recent report made by the Greek Embassy in Bucharest, Ioannis Paschalis, minister counselor for economic and commercial affairs, noted that in early 2012 some 5,284 Greek-owned companies were registered in Romania, with 82 established in the first three months of 2012 alone. In an interview with the Romanian “Business Review Journal”, Paschalis noted another interesting aspect: “Greek capital inflow in Romania increased by more than EUR 1 billion over 2009-2011,” he said, adding that “Romanian exports to Greece increased by 4 percent and 8.6 percent in 2010 and 2011, respectively.”

The total capital invested by Greeks in Romania totals more than 4 billion euros, according to the Greek Embassy in the country. This figure was reached without taking into account any estimates of private investments in real estate or ‘unofficial’ investments- often a product of money laundering between Greek and Romanian networks of white-collar or street crime.

In general Greece is the fourth-largest investor in Romania with a diverse range of activities. RomTelecom is one of Cosmote’s subsidiaries in the Balkans. The banking sector is particularly dynamic as well, with Bancpost, Alpha Bank, Banca Romaneasca, Emporiki bank, ATE bank and Marfin Bank representing Greek ownership. These banks operate around 850 branches across the country.

In 2009, Greek investments received a boost even as the debt crisis was engulfing Greece, with 720 million euros being invested in Romania. An additional 570 million euros were invested during the next year. The majority of these investments were directed towards industries like food and dairy production, aluminum plants, healthcare, bakeries, IT and banking.

The Greek Ministry of Agriculture has also received several requests from Greek farmers’ syndicates over the past few years asking for assistance in exploring opportunities for buying farmland in Romania for producing corn and sunflowers as well as animal products such as pork. Romania has potential, so far unrealized, for becoming a major agricultural exporting state in Europe, and in addition has the capacity for considerable exports to the CIS countries; these number more than 280 million consumers.

Another interesting trend is the increase – by as much as 30 percent – in Greek university students pursuing their studies in Romania, in either public universities or private Anglophone colleges. Greeks traditionally tend to study abroad and the economic crisis has influenced them to choose Romania, due to the lower cost of living there than in the rest of the EU, as well as its proximity to Greece. This also helps increase the interpersonal connections between the two countries due to mutual immigration. Most recently, Greek academics, mostly educated in the sciences, have taken jobs in Romania and teach at the local tertiary level.

Lastly, tourism is expanding, with a steady increase of Romanians coming to Greece each year. The Greek National Tourism Authority estimates that since 2005 the country has become among the top five destinations for Romanian holiday-makers, with some 500,000 visitors so far in 2012.

Roxana Birau, a Romanian who works with the local office of the National Organization of Tourism in Greece, has noted that “an Englishman spends five to 10 euros a day, while a Romanian disperses between 80 and 100 euros [above and beyond] the pre-paid holiday package.” It is of interest to note that in general Balkan and Russian tourists are traditionally bigger spenders on their vacations than are the more affluent Northern European ones, following a similar consumer behavior of that of American and Canadian tourists.

The number of Romanian citizens living as immigrants in Greece is estimated at 30,000 people, although according to the estimates of the Romanian Embassy in Athens, there has been a 25 percent drop since 2010 and an additional decline is expected if the crisis continues for long, as is expected. During the boom years of the early 2,000’s more than 70,000 Romanians worked in Greece.

On the other hand, according to the General Secretariat for Greeks Abroad (a subdivision of the Greek Ministry of Foreign Affairs) the Greek community in Romania numbers 14,000, divided amongst Greeks descending from communities of the Byzantine and Ottoman Empires era, and 1940’s political refugees which account for 70 percent. The rest are composed of new immigrants who came over the past 15 years, either working in Greek companies in Romania or marrying citizens of the country.

The latter group is estimated to increase due to the worsening economic situation in Greece. Although numbers are not exact, it is estimated that 800 Greeks settled over the past two years, with the trend expected to accelerate in the near future.

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