1st June
2007
Over EUR 30 bn investments in energy sector until
2020
The total volume of the investments in energy in Romania will amount to EUR 30
bln until 2020, of which the state and the state companies will allot around 30
per cent, declared on Thursday the Minister of Economy and Finance, Varujan Vosganian,
at a seminar on energy themes.
“The amount will be much over EUR 30 bln, because I have not considered
the project of the hydro power station Tarnita, the co-generation and thermal
rehabilitation investments,” said Vosganian.
In the gas sector, the investments which are allotted amount to EUR 270 M for
search and exploration, and EUR 500 million for the growth of the storage capacities.
These estimates do not include the funds from a possible partnership with the
Russian firm Gazprom for the deposit of natural gas from Margineni and the contribution
of Romania to the gas pipe project Nabucco. The latter amounts to several billions
Euro.
The investments in the rehabilitation of the gas transport systems are also estimated
at EUR 300 M, while those in the gas network at EUR 25 M per year until 2015.
In the domain of oil, the investments scheduled by Petrom until 2010 are EUR 3
bln. Vosganian estimated that the investments of all the other firms from the
market could be 2.5 times bigger, i.e. EUR 7.5 bln.
The energy complexes need until 2010 investments of around EUR 2 bln for environmental
protection and modernization, meaning EUR 750 M at Craiova Isalnita, EUR 705 M
at Rovinari and EUR 760 M at Turceni.
Minister added that there is not any risk to close down thermal stations until
2010.
“There is time to make environmental investments in the thermal stations,
and not any of them will be closed until 2010. But, as we are drawing closer to
this deadline, we must make these investments,” added Vosganian.
The Minister of Economy and Finance also referred to investments of EUR 2.4 bln
for the reactors 3 and 4 from the nuclear station Cernavoda, to the amount of
EUR 1.8 bln stipulated by the state for the sources of regenerative energy, the
village electrification programme, and the amount of some EUR 800 M allotted by
Enel for the acquisition of the majority stake of Electrica Muntenia Sud, from
which EUR 400 M will go to the state, and the balance will be invested in the
company.
Asked if he considers viable the proposal of Rompetrol president, Dinu Patriciu,
that Romania put up for action all the licenses for the exploitation of the gas
deposits and turn Romania into a gas deposit able to supply the European states,
Vosganian said that there is potential in this respect. “There are several
points of view in this respect, and the potential of Romania to store gas is very
big,” said the Minister.
Source: Nine O'Clock
First GE operation in Southeastern Europe in Romania
General Electric – “Most Respected Company in the World” for
7 years in a row by Fortune magazine - chooses Romania for its first manufacturing
operation in Southeastern Europe. The domain selected by GE for this operation
is high-tech: the manufacturing of aircraft engines components; the company is
Turbomecanica Combustor Products (TMCP) for which GE Aviation agreed to purchase
the remaining 50 per cent ownership from its current joint-venture partner Turbomecanica
S.A.
“GE, a real global company, invests in geographical areas with high expansion
potential. Romania is a very important market, experiencing growth in many sectors
and it was normal for us to take into consideration all opportunities to grow
our local presence”, said Dan Ionescu, GE Regional Executive South East
Europe.
This acquisition of Turbomecanica Combustor Products (TMCP) fortifies GE Aviation’s
European manufacturing presence and helps enhance international marketing and
sales efforts for the portfolio of GE engines.
Since the creation of the joint venture, many investments have been made in the
facility which is now endowed with some of the best, state of the art production
equipment in Europe. TMCP provides extensive manufacturing capacity for CF34 and
CFM56 engines: approximately 50 per cent of the combustors for these 2 engine
lines are produced here, in Romania. The components crafted at the plant are exported
to USA and then distributed all over the world.
“GE considers this acquisition as a solid opportunity to further develop
the significant intellectual investment made over the past four years in TMCP,
further enhance productivity and confirm customer expectation related to an increasing
combustor order volume. By continuing to focus on our manufacturing proven methodologies
(called “Six Sigma”), that optimize efficiency by enabling GE to proactively
reduce errors in products, services and processes, we look to further enhance
productivity and maintain world-class status in the manufacturing of high technology
aircraft engines components”, said Jacques Juneau, Executive Officer of
TMCP.
TMCP has been set up by a joint venture between GE Aircraft Engines and Turbomecanica
in March 2002 to manufacture combustors for aviation engines. The facility will
continue to operate as it is presently constituted, focusing on helping the business
meet our customer requirements, with no adverse impact on the workforce.
GE is a worldwide market leader in almost all its sectors of activity and the
second-largest company in the world by market capitalization. GE is already present
in Romania in the domain of health, in the energy sector, as provider of high-tech
and also with GE Money, the global consumer finance unit of General Electric Company
(NYSE: GE), that acquired full control last year of three non-banking financial
institutions - Leasemart Holding BV (Leasemart, trading under the “Motoractive”
brand), Ralfi S.A. (Ralfi, trading under the “Estima Finance” brand)
and Domenia Credit S.A. (Domenia).
Source: Nine O'Clock
Romania modernises its highway infrastructure
Romania is trying to meet EU road infrastructure standards. Work is in progress
on three highways, and the country hopes to build over 1000km of new roads by
2012.
Expanding and modernising its road infrastructure has become a top priority for
Romania. Economic growth demands faster and easier cross-country transit. Moreover,
as a new EU member, Romania needs better connections with state-of-the-art European
highways.
Several major foreign investors have expressed interest in building Romania's
new, modern road infrastructure. Among them are Lena from Portugal, Aktor from
Greece, Vegyepszer from Hungary, and several consortiums.
Of the projects initiated by the government so far, one of the boldest is the
Transylvanian Highway -- a four-lane, 415km long motorway stretching northwest
from Brasov in central Romania to Oradea, on the border with Hungary. It is currently
the largest highway project in Europe.
Upon completion, expected in 2013, the motorway will form an important section
of the Romanian national highway system, providing a vital connection with the
rest of the continent, and linking major European market centres with those in
Central Asia.
Work on the Transylvanian motorway began in 2004, under a 2.2 billion-euro contract
with the US-based firm Bechtel. The Romanian government provided around 184m euros
in funding for this project this year.
Another project -- to build a highway linking Bucharest with the harbour city
of Constanta on the Black Sea -- is continuing.
The first 18km of this highway, out of the planned 225km, were completed under
former dictator, Nicolae Ceausescu, in 1987. Some 173km of this highway, spanning
the capital and the town of Cernavoda on the banks of the Danube, is already in
use. The project should be completed by 2010.
Also under construction is the 1.6 billion-euro Bucharest-Brasov highway, initiated
last year. It is a 173.3km, two-lane motorway that will link the capital to the
western border by joining up with the Transylvanian Highway. The Bucharest-Brasov
project will provide a long-awaited alternative to National Road 1, the most congested
road in the country.
Future projects under consideration include a highway linking the western border
checkpoint of Nadlac to Bucharest, via the city of Timisoara. There are also plans
for a route linking the northern town of Suceava to the Ukrainian city of Cernauti,
connecting the 4th and the 5th pan-European highways.
Source: SE Times.com
Romania emerges from the dark
Since Romania's January 2007 entry into the European Union (EU), the country has
experienced a wave of electronics investment that positions it to become Europe's
next success story.
But now that is all changing. Since its January entry into the European Union
(EU), the Southeastern European country, with a population of 21.5 million, has
seen a wave of electronics investment that positions it to become Europe's next
success story.
Chip-design activity has picked up. Microchip Technology in April launched a design
center in the capital city of Bucharest. Engineers are doing core chip design
and application support for analog PIC microcontrollers, says Rich Simoncic, vice
president of Microchip's analog products division.
Infineon Technologies opened an R&D center in Bucharest in 2005 that currently
employs 150. The center develops ICs for automotive, security and RF applications.
The company says it plans to add 100 engineers in the next three years.
"By 2010, the target is to become the largest IC design center in Infineon,"
says Thomas Simonis, head of Infineon's R&D center in Bucharest.
On the manufacturing side, Selectron and Celestica were running factories in Western
Romania well before the country's EU entry. But Nokia became Romania's centerpiece
in March when it announced an $81 million factory to make mobile devices for export
in Cluj Napoca, Northwest Romania.
The total investment, however, is estimated to reach $270 million since Nokia
plans to build an industrial village to host suppliers and support facilities.
Nokia would then surpass Solectron as Romania's largest electronics sector investment,
says Robert Donose, senior counselor at ArisInvest, Romania's agency for foreign
investment in Bucharest.
Other recent new factories or expansions include Electrolux, Emerson and Siemens.
A low cost of entry is one draw for companies, since Romania's corporate tax rate
is only16% and an average of all monthly wages is $470. "One element that
has attracted manufacturers is that we have the lowest costs in the EU,"
Donose says.
"The cost issue is on the checklist, but not on the top," says Infineon's
Simonis. "Analog and mixed-signal expertise are not available everywhere
and Romania had a pretty good pool of them."
Communist-era Romania had a strong top-down engineering focus. But as the open
world embraced the digital revolution and engineering students dropped analog
for digital, closed Romania was forced to stay in the analog world. Universities
emphasized analog expertise and that's paying some dividends today. "West
Europe universities do not focus on analog," Simonis says.
As expanding companies fight to fill engineering slots, soft criteria is now carrying
more weight beside cost in the search for talent. Sources cited Romanians' strong
English and European language skills and the relief of dealing with a culture
that shares European similarities.
"IC design can require close contact with the customer and it's much easier
to deal with people who think in a similar way," says Infineon's Simonis,
adding that the operation has worldwide responsibility for some projects. "This
is not a support center or extended workbench."
Accessibility also influenced investment decisions. A key reason Nokia chose Cluj
was logistics. Cluj has airport and railway connections and roads are getting
an upgrade. It's also 300 miles from Nokia's Hungary plant. "We have a strong
supplier base in Hungary and it's beneficial to have these two plants near each
other," says Liisa Nyyssönen, spokeswoman for Nokia who worked on the
Romania project.
In Bucharest, the wide range of international flights puts it three hours from
Europe and nearly in the same time zone. "Ease of access for us was paramount,"
says Microchip's Simoncic.
While none of the companies interviewed for this story received significant investment
incentives, incentives are expected this year and could include tax breaks, land
and utility discounts and grants for R&D, Donose says.
But Romania's engineering reserves are already tightening up. Microchip started
recruiting an initial staff of 30 engineers in July 2006 and is still filling
positions, according to Simoncic. Other companies expanding their sizeable IC
and software operations include Freescale Semiconductor, Siemens VDO and Alcatel-Lucent.
"As more competition comes in, it's really getting tougher to find people,"
says Infineon's Simonis. He adds, however, that some expatriate Romanians who
fled years ago are beginning to return.
Romania's tech investments underscore the speed of change in Eastern Europe as
well as the role of the EU as business incubator for new member states. In communist
times, Romania was effectively sealed off from the world under an ultra-restrictive
regime that drew inspiration from North Korea's totalitarian system.
Romania opened to the world only after the country's dictator was executed in
1989. Years of struggle with pervasive corruption and old regime restraints followed
until the country met EU entry criteria.
The country now seems to have righted itself. A recent International Monetary
Fund mission to Romania praised the 7.7% GDP growth and inflation performance
as "remarkable."
Source: EDN
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