Business Review - 11/2015

INTERVIEW: With annual investments in R&D projects reaching 10 percent of turnover and a consolidated turnover of EUR 93 million in 2014, Bogdan Padiu, CEO at Teamnet Group says the group aims to generate 40 percent of revenue from international markets by 2018 » page 28

ROMANIA’S PREMIER BUSINESS MAGAZINE

NOVEMBER, 2015 / VOLUME 19, ISSUE 11

R&D ROMANIA SPENT RON 2.5 BILLION ON RESEARCH AND DEVELOPMENT LAST YEAR, REPRESENTING 0.38 PERCENT OF THE COUNTRY’S GDP, WITH 0.22 PERCENT OF THE MONEY GOING TO THE PUBLIC SECTOR AND 0.16 PERCENT TO THE PRIVATE ONE » PAGE 23

OUT OF THE ASHES The tragedy at Colectiv nightclub in Bucharest had the power to bring 20,000 people out into the streets of the Capital and change the Victor Ponta government » page 16

REAL ESTATE

TRAVEL

Going up

The real deal

Skanska has sold the second building of its Green Court Bucharest office project to Globalworth, controlled by local businessman Ioannis Papalekas for EUR 47 mln » page 6

Castles, manors and fortified churches scattered across scenic villages and unspoiled nature are all waiting to be discovered in Covasna County » page 38

www.business-review.eu Business Review | November 2015

EDITORIAL Anda Sebesi EDITOR-IN-CHIEF

Fire of change More than three weeks have passed since the tragedy at the Colectiv nightclub and unfortunately, there are still many victims that hover between life and death.

It was more than a fire. It was a blaze that transformed into a social movement that extinguished many lives and also, the very controversial government of the former Prime Minister Victor Ponta.

People went out into the streets with a need for change. Not a superficial change, but one of substance. It seems that it was the last drop that made the cup run over.

Romanians don’t want corruption, bureaucracy and lack of responsibility anymore. Instead, they want responsible leaders who are able to take measures so that the economy can grow on a sustainable basis. They want a clear legal framework that supports the business environment and helps to avoid tragedies like the Colectiv one.

Unfortunately, Colectiv has become a symbol and also a strong negative Romanian brand. It is the essence of a sick system that ends up killing people, but also the symbol of a social movement and community involvement.

Both local media and opinion leaders believe that changing the government is not the solution that solves all the problems that Romania faces now. The deeper the problems are, the deeper the change needs to be. Many argue that a profound and general change can come only from within.

Each and every one of us should do, or at least try to do, his or her best in his field. Both as an individual and as a professional.

The Colectiv tragedy put some pressure on the local communication industry, as the nightclub fire resulted in an unprecedented national crisis. PR specialists say the matrix of communication in a crisis should be thought around some core values: care, commitment, consistency, coherence and clarity. More than ever, this unfortunate context has shown the Romanian PR industry that things need to change and that the administration and the public sector in general need proper guidance for a PR crisis.

Pundits say that in Colectiv’s specific case, we’ve seen a lot of care and commitment which is a big step forward, but we haven’t seen that much consistency, coherence and clarity and this is directly linked to the lack of procedures and organizational culture. But there is always a bright light of things. The positive outcome in this huge tragedy is that this crisis has produced a whole reset of the Romanian reality, from politics, to administration, business and population. This window of opportunity will grow and will change the whole paradigm in Romania.

Dacian Ciolos, the newly appointed prime minister, is now facing at least two double big challenges: that of making the economy work with the support of his team of new ministers and not disappointing the protesters. The representatives of the local business environment expect that the new government could bring a new wind and regain the trust of business people. In addition, it is advisable that any measures taken by the new government to be filtered by strategic relevance, economic efficiency and budgetary sustainability, considering the trans-sectorial alignment. Albeit we speak about a short-term mandate, the importance of this moment is crucial from the general perspective and that of Romania’s development. We shall see how deep will be the change for Romania and its Romanians. anda.sebesi@business-review.ro

EDITORIAL 3 Contents 3 8 14 16 19 22 24 26 28 30 32 37 38 40 41 42 44 45 46

EDITORIAL BR EVENTS

Fire of change Cautious optimism surrounds Romania’s growth outlook EDUCATION Montessori schools on the rise in Romania COVER STORY When a fire extinguishes lives and a government Colectiv comment: can a safer capital be the legacy?

TELECOM Orange Romania: one step closer to completing national network overhaul project RETAIL Black Friday shopping spree boosts retailers’ profits in Romania IT Azimo launches money transfer service in Romania TECHNOLOGY Technology is the catalyst for change TECH SHOPPING Audiophile? Jazz up your home!

PR How a nation learns a PR crisis-handling lesson MANAGEMENT When CEOs meet at their clubs TRAVEL Covasna – thriving land of authenticity and tradition GREEN CORNER Social involvement through medical services SHOPPING Ready for Christmas shopping?

WELLNESS The greatest challenge is to make fitness fun FASHION The chemistry behind the online platform which showcases Romanian-only designers RESTAURANT REVIEW Is it worth the trip?

CITY Cultural calendar

ISSN No. 1453 - 729X PUBLISHER Bill Avery EDITOR-IN-CHIEF Anda Sebesi DEPUTY EDITOR-IN-CHIEF Simona Bazavan JOURNALISTS Otilia Haraga, Tatiana Lazar, Romanita Oprea, Natalia Martian, Andreea Tint COPY EDITORS Debbie Stowe, Eugenia Pupeza PHOTO EDITOR Mihai Constantineanu LAYOUT Raluca Piscu PUBLISHER Bloc Notes Media ADDRESS No. 10 Italiana St., 2nd floor, ap. 3 Bucharest, Romania LANDLINE Office: 031.040.09.31

EXECUTIVE DIRECTOR George Moise BUSINESS DEVELOPMENT DIRECTOR Oana Molodoi SALES DIRECTOR Ana-Maria Nedelcu SALES CONSULTANT Valeria Cornean EVENTS DIRECTOR Oana Albu MARKETING Anamaria Radu, Marius Andronic PRODUCTION Dan Mitroi DISTRIBUTION Eugen Musat EMAILS editorial@business-review.ro sales@business-review.ro events@business-review.ro

www.business-review.eu Business Review | November 2015

4 NEWS

NEWSin brief AUTO Operating leasing market grows 14 pct in Q3 2015 y-o-y The operating leasing market has risen above 53,600 units under management at the end of Q3 of 2015, up 14 percent compared to the same period of 2014 and nine percent from the beginning of the year, according to data from the Operating Leasing Companies Association (ASLO.) Between January and September, 11,000 vehicles were registered by operating leasing companies, representing 17 percent of all new registrations, an increase of 2 percentage points over the same period last year.

The growth trend anticipated by experts is maintained, both in the automotive and fleet management services.

BANKING ING Romania reports 9 pct net profit increase for first 9mo ING Romania has reported a net profit of RON 251 million (EUR 56.5 million) for the first nine months of the year, up nine percent y-o-y, while total revenue reached RON 748 million (EUR 168.36 million), up 12 percent y-o-y, according to the company’s financial report.

The loan portfolio increased by 21 percent to RON 13.15 billion (EUR 2.96 billion) from RON 10.84 billion in September 2014.

Erste Group’s interest income in Romania drops 13 pct during first 9mo Erste Group’s net interest income in Romania (comprising Banca Comerciala Romana Group) decreased by 13.1 percent during the first nine months of 2015, company representatives announced.

Reaching EUR 325.9 million (from EUR 374.9 million during the first nine months of 2014), representatives say it was mainly due to lower income from unwinding, lower average loan volume and lower interest rates.

Consequently, operating income decreased to EUR 506.2 million (10.3 percent lower year on year), while operating expenses increased mainly due to higher personnel and IT costs, reaching EUR 249.1 million (5.1 percent increase).

CONSTRUCTIONS Construction works pick up pace in September In September 2015, the volume of construction works increased over the pre-

vious month, both as gross series (13.7 percent) and as adjusted series (0.7 percent), show data released by the National Institute for Statistics. In August the volume of construction works had shown a smaller rise in gross series, of 5.2 percent, while adjusted series decreased by 0.4 percent.

September’s construction volumes increase in gross series was brought on by new construction works (up 16.7 percent,) maintenance and current repairs works (up 13.2 percent) and capital repairs works (up 1.6 percent.)

ENERGY Electrica profits go up 27 pct during nine months Romanian electricity distributor and supplier Electrica Group posted a RON 428 million consolidated profit during the first nine months of 2015, increasing

by RON 92 million (27 percent) y-o-y, according to the group’s financial report.

The company recorded a 16 percent growth in EBITDA. The profit attributable to shareholders increased by 38 percent. During the first nine months, Electrica recorded an operating income worth RON 4.13 billion, up RON 384 million (10 percent) y-o-y, while operating expenses dropped by RON 32.5 million (2 percent.)

HR Romania ranks 48 out of 61 in talent competitiveness top With an overall score of 23.3, Romania dropped ten places from 2014 to the 48th position in the IMD World Talent Ranking 2015 which aims to analyze a country’s capacity to host and grow talent, by IMD World Competitiveness Center.

The first place was taken by Switzerland, the same as in 2014, with a score of 100.

Denmark (83.7 points) maintained second position while Luxembourg climbed 10 spots to third (78.6 points.) The last five places were taken by Brazil (10.8 points,) Croatia (9.6,) Peru (7.8,) Venezuela (2.9) and Bulgaria (0.0.)

INSURANCE Private pensions on the rise in September, says ASF Private pensions reached a 3.46 percent share of GDP in September 2015, a rise from the 2.8 percent share registered in September 2014, according to data released by the Financial Supervision Au-

thority (ASF.) Total value of private pensions increased to RON 24.27 billion (EUR 5.5 billion) during the first nine months of the year, going up by 29.3 percent y-o-y and 20.35 percent over 2014 yearend. Net value reached RON 23.07 billion (EUR 5.2 billion,) going up 29.8 percent y-o-y.

Four out of 10 Romanians see fire as major threat to their homes According to a study by the Association for Insurance Promoting (APPA,) 38.1 percent of Romanians see fires as the biggest threat to their homes, followed by 30.5 percent who consider earthquakes at the top of the list.

The study called October, the month for home insurance, was made to support an informing campaign by the Insurance Pool against Natural Disasters (PAID) and APPA, most likely did not take into account the effect of the recent fire that has taken place in a Bucharest nightclub.

MACROECONOMICS Romania posts highest economic growth in the EU in Q3 According to data released by the National Institute for Statistics (INS,) Romania posted a 3.7 percent GD increase for the first nine months of 2015 y-o-y, the same level registered for first half of the year. The GDP was up by 3.6 percent in Q3, y-o-y, the highest level reported in the EU rise over the same period of the previous year, shows Eurostat data.

Seasonally adjusted GDP rose by 0.3 percent in the euro area (EA19) and by 0.4 percent in the EU28 during the third quarter of 2015, compared with the previous quarter.

ING reduces inflation estimates for Romania at -0.7 pct for 2015 and 1.2 pct for 2016 ING has reduced the inflation estimates for Romania for 2015 and 2016 by 0.2 percent, at minus 0.7 percent, and 1.2 percent, respectively, while the prognosis for 2017 sees an increase of 0.6 percent to 2.7 percent following changes in oil price expectations, the bank announced today.

This comes only a few days after the National Bank of Romania (BNR) also revised their inflation prognosis. The results were similar to those put forth

by ING, with BNR predicting a minus 0.7 percent rate for the end of this year, 0.4 percent less than their August estimates, and a 1.1 percent rate for the end of next year, which is a 0.4 percent increase than initial estimates.

Without the round one impact of the

MONTH AHEAD DECEMBER 1 Possible increase in public wages The Parliament voted that all public workers will receive a 10 percent increase in wages, with those employed in the education industry receiving a 15 percent increase, starting December 1st. The law will now reach President Klaus Iohannis, who can either approve it or send it back for re-evaluation.

Since the law is a measure proposed by the former Prime Minister Victor Ponta, prime minister-designate Dacian Ciolos could also delay putting it into practice.

DECEMBER 10 Central Bank to publish national financial accounts report On December 10th, BNR will publish two yearly reports on the national financial accounts, one targeting the total economy and one targeting institutional sectors.

DECEMBER 15 INS to publish world economy statistics The National Institute of Statistics (INS) is set to publish its “World Economy in Figures” statistics on December 15th.

This paper is published every two years and it provides comparative data on the economic and social development of Romania and other European countries and the world.

DECEMBER 17-18 European Council meeting The European Council will meet on December 17th and 18th. Items on the agenda include addressing the current migration and refugee crisis, the President’s report on the economic and monetary union, the completion of the European single market in all its dimensions and the next steps on a UK in/out referendum.

MOST READ www.business-review.eu 1 Thousands protest in Bucharest asking for resignations in aftermath of nightclub fire

2 Romania holds three days national mourning following Bucharest night club tragedy

3 Colectiv: a tragedy that sums up the two sides of Romania

4 Romanian protests continue into weekend

5 Colectiv fire aftermath: club owners investigated, Bucharest club closes doors, head of TVR news division resigns

www.business-review.eu Business Review | November 2015

value-added-tax (VAT) reduction, the predicted inflation rate would have reached 2.1 percent at the end of this year and 2.7 percent in 2016, according to central bank governor Mugur Isarescu cited by ZF.

Romania’s trade deficit rises 28 percent to EUR 5.5 bln during first nine months In the first nine months of 2015 exports amounted to EUR 40.91 billion and imports amounted to EUR 46.44 billion, leading to a trade deficit of EUR 5.53 billion, according to data released by the National Institute for Statistics. While exports climbed 4.7 percent and imports 7.1 percent during the first nine months, the trade deficit also showed an increase of 28 percent y-o-y (EUR 1.23 billion more.)

Romanian exports to the EU amounted to EUR 30.03 billion (representing 73.4 percent of total exports,) while imports stood at EUR 35.63 billion (76.7 percent of total imports.) Outside of the EU, Romania exported goods worth EUR 10.87 billion and imported goods worth EUR 10.81 billion.

MANUFACTURING

NEWS 5 with office space closed in 2015 involved tenants from outsourcing, a strong increase from the 27 percent share registered in 2014, according to CBRE data.

The total modern office stock in Romania stands at 3.1 million sqm and outsourcing companies occupy more than 500,000 sqm, with information technology outsourcing (ITO) leading the sector at 45 percent. Business process outsourcing (BPO) companies claim about 26 percent of the office stock, while shared service centers (SSC) haves 19 percent and research and development (R&D) account for 10 percent.

Bucharest apartment asking prices stay stable in October Asking prices for apartments in central, semi and north of the capital grew by about one percent in October compared to September, while prices asked by owners for apartments in the east, south and west have stabilized, according to an analysis of the Bucharest property market by HomeFinders.

Owners of apartments in central and northern Bucharest requested an average price of EUR 68,000 in October. On the other hand, average requested prices for apartments in the east, south and west areas have stabilized around EUR 51,479 (a mere EUR 21 drop from September.)

New Airbus Helicopters factory opens in Brasov Airbus Helicopters Industries has inaugurated a new 10,000 sqm factory in Brasov, according to company data. The factory is designed to host the production of the H215 helicopter, the company’s newest model. Employing 300 people, the Brasov unit’s production capacity reaches up to 15 aircrafts a year, with the first H215 expected to be produced in 2017. Airbus Helicopters is a division of Airbus Group, producing civilian and military helicopters.

ONLINE Romanians increase budget for Black Friday online acquisitions by one third in 2015 Romanians will allocate an average of RON 460 (approximately EUR 104) for online acquisitions this year for Black Friday, about a third above their 2014 average budget of RON 340, according to data from NETOPIA mobilPay. Overall, retailers expect the number of online payments to increase by half because of Black Friday acquisitions. About a third of online payments will be made via tablets and smartphones and the rest via laptops and desktops, according to the same source.

REAL ESTATE Outsourcing companies account for half of Romania’s office market in 2015 More than 50 percent of transactions

RETAIL About half of Romanians plan to buy on Black Friday, study says According to a study by brand research company Millward Brown Romania, 44 percent of Romanians aged between 18 and 65 are planning to buy something during Black Friday promotions. Compared to 2012 data, the numbers have almost tripled, while the number of people who have heard about this type of promotions reached 71 percent.

When it comes to population segments, men and overall young people (aged 24 to 34) show most interest in the offers, with 63 percent of men and 64 percent of young people expressing their intent to buy.

TELECOM Vodafone Romania customer base up 6.4 pct at the end of September Vodafone Romania saw a 6.4 percent yo-y increase in the number of customers during the second quarter of fiscal year 2015-2016, ended September 30, 2015, according to results reported by Vodafone Group Plc. Vodafone Romania had some 9 million customers at the end of September, the number increasing by 546,371 compared to the same period last year. Of the total number of customers over 93 percent (some 8.4 million) are users of mobile services.

WHO’S NEWS BR welcomes information for Who’s News.

Submissions may be edited for length and clarity.

Get in touch at simona.bazavan@business-review.ro

Ana-Maria Ghiurca is the new client service director of SeniorHyper. She will be in charge of clients such as ING, Orange, Caroli Foods and Antipa.

Ghiurca has worked for several media agencies over the years with clients from the energy, food, financial services, telecom, auto and banking industries.

She has 13 years’ professional experience in advertising, of which for the past four years she was active in digital advertising. She graduated from the Faculty of Automatics of the Academy of Economic Sudies in Bucharest and holds an MBA in foreign languages from the Polytechnic University in Bucharest.

Daniel Ionescu has been appointed marketing director of Star Storage. Previously, he was strategic marketing director at TotalSoft for five years and served for 10 years as director of operations at Bitdefender, having experi-

ence in developing and positioning Romanian software products on international markets. Ionescu graduated from the Polytechnic University of Bucharest and the RomanianCanadian MBA from the University of Ottawa with a degree in marketing.

Francois Petry has been appointed CEO of Aggregates Industries, a LafargeHolcim subsidiary in the UK, starting in December. He is presently acting as general director of Holcim Romania, a position he has held for the past two years. Petry, 48, previously worked as GM of Holcim’s aggregates division in France. Before that he activated in road infrastructure and constructions for nine years. Petry has been a member of the Foreign Investors’ Council since may and he has been the president of the Romanian-Swiss Chamber of Commerce (CCE-R) since October 2014.

www.business-review.eu Business Review | November 2015

6 REaL ESTaTE

Globalworth buys Skanska’s second office building for EUR 47 million Swedish developer Skanska has sold the second building of its Green Court Bucharest office project to Globalworth Real Estate Investments, controlled by local businessman Ioannis Papalekas for EUR 47 million. ∫ Simona Bazavan The acquisition of the second building of Skanska’s Green Court Bucharest office projects in northern Bucharest by Papalekas comes as no surprise as the businessman also bought the first building totaling 19,500 sqm at the end of last year for EUR 42 million. Moreover, news about the transaction breaks after in early October, Globalworth announced that it had raised EUR 53.8 million on the London Stock Exchange through the placing of ordinary shares.

Following this transaction, the office portfolio of Globalworth Real Estate Investments surpasses the 200,000 sqm threshold. Other buildings in the company’s portfolio include Unicredit Tower, Nusco Tower, BOB and BOC. The second building of Skanska’s Green Court Bucharest required an investment of some EUR 33 million and features a gross leasable area (GLA) of

18,000 sqm. It was completed earlier demand for office space in Romania, this year and approximately 72 percent and particularly in Bucharest, will of the building is leased, tenants includ- grow even further in the coming years, ing Sanofi, Adecco, Carrefour and Col- as a result of the development of the gate Palmolive. services sector and the attractiveness The Green Court Bucharest office of the local labor market to internacomplex will comprise three buildings tional players. with a GLA of approximately 54,500 According to data from the Associsqm. Works on the third building have ation of Business Service Leaders already begun and the developer plans (ABSL,) Romania is the second-fastest to complete it in June 2016. growing shared-services and outGreen Court Bucharest is Skanska’s sourcing market in Central and Eastfirst project in Romania but the Swedish ern Europe. There are already more developer has announced from the very than 80 centers employing about beginning plans to acquire additional 45,000 people in the country and land in the capital for further develop- Bucharest is one of the main businessments. This September, the company services locations. The Romanian completed a transaction for a 21,000 business-services sector is expected to sqm plot of land in the west-central area employ 150,000 to 200,000 people by of Bucharest on the Iuliu Maniu Blvd. 2020, according to the same source.

The land was bought from Pumac SA. “This is a clear signal to office developers,” commented Skanska representaDemand for office space on tives.

the rise

Skanska representatives estimate that

simona.bazavan@business-review.ro

www.business-review.eu Business Review | November 2015

REaL ESTaTE 7

P3 signs deal with Carrefour for 81,000 sqm logistics complex near Bucharest

PaRTnER ConTEnT

aFi Park – an art of “Class a” office Buildings

The new developments will increase Czech PointPark Properties’ (P3) existing logistics space portfolio to approximately 270,000 sqm. ∫ Simona Bazavan Retail, car parts manufacturers and logistics operators were the most active players on the industrial market in the first nine months of 2015, said JLL representatives. A new development this year is the increasing demand coming from retail and e-commerce companies which leased a total of 80,000 sqm. Much of this was fueled by preparations for Black Friday sales. Car parts manufacturers leased 63,000 sqm and logistics players leased 44,200 sqm.

Bucharest and Timisoara were the most active markets, reporting leasing volumes of 65,600 sqm and 41,200 sqm, respectively. What is different this year is an increased interest for new cities such as Brasov (16,000 sqm), Cluj-Napoca (26,600 sqm), Pitesti

(14,000 sqm), Ploiesti (28,900 sqm), Ramnicu Valcea (12,800 sqm), Targu Mures (3,500 sqm) and Sibiu (11,500 sqm,) according to JLL representatives.

“We believe this trend will continue and the logistics and industrial market will no longer be concentrated in several large cities where the labor pool is becoming limited, but will also extend to other cities where it is easier to find employees,” said Cristina Pop, the head of the industrial department of JLL Romania.

The firm estimates that a total of 300,000 sqm of industrial space will be leased until the end of this year, in line with the 2014 volume.

JLL was involved in a third of the total industrial space transactions signed this year or about 73,000 sqm, according to company data. simona.bazavan@business-review.ro

new property tax expected to raise office demand by a quarter The new tax system for homes used as company headquarters which comes into force next year could result in an increase of approximately 25 percent of demand for spaces in office buildings, says real estate company Regatta. ∫ naTaLia maRTian The new taxation system for residential properties used as company headquarter which will come into force in 2016, will no longer take into account whether the owner is an individual or legal entity, but the use of the building, say Regatta representatives. For buildings owned by individuals and used for business purposes, such as firms, taxes are set to go up. The tax will vary between 0.2 percent and 1.3 percent if the property was reassessed, built or acquired in the last five years. If the property does not meet this condition, the tax applied will be of two percent of the building’s value. This situation could lead to taxes exceeding 20 times the current level, according to Regatta representatives.

“Significantly raising taxes will automatically determine the owners to raise the rent proportionally. Basically it will be more advantageous for companies to rent space in conventional office buildings rather than in apartments or villas.

The challenge for developers will be to build smaller office spaces than those developed so far, in locations with access to the infrastructure, especially the metro – or restructure their old ones. We also expect an increase in requests for building valuation services,” said Eduard Uzunov, president of Regatta Real Estate.

Regatta’s portfolio includes office buildings such as Nord City Tower, World Trade Center, Floreasca Business Park, Bucharest One, Sky Tower or Hermes Business Campus. natalia.martian@business-review.ro

"aFi PARK", the award winning office project is Bucharest’s most advanced business centre, consisting of 5 Class A office buildings totaling 70,000 sqm GLA, linked to AFI Palace Cotroceni Shopping Mall (81,000 GLA). The complex (151,000 GLA) enable the most convenient & perfect combination between business and personal lifestyle, a work environment which meets the modern lifestyle sought after by the IT generations (“Generation X, Y and Z”); An all in one efficient, time saving, immediate location. AFI Park is easily accessible through the public transport system, with a nearby Metro/Subway station “Politehnica Metro Station”, only 250 meters from the project in addition to 12 different bus and tram lines that are serving the mall and the business park.

AFI Park office buildings were voted as best overall designed office buildings in Romania, including winning the prestige CEEQa award by the Financial Times. AFI Park has been established as the new IT&C Hub for multinational prestigious IT companies such as: Electronic Arts, Traded in US (EA), Conglomerate TELUS International, Traded in US (TU), UK held Endava Romania, Microchip Technology, Traded in US (MCHP), Sparkware Technologies and Cameron Romania, part of Cameron Group traded in US (CAM).

The leased premises are delivered according to Tenant’s planning and design. The standard fit-out listed below is the base built on which additional fit-out shall be implemented. For items that are not used from the base built the tenants receive a credit amount: Technical Specifications AFI Park 4&5, the 4th phase of the award winning project: l Floor Plate of 2,722 sqm NLA l Raised floor – Fully encapsulated l Carpet and Flooring l Suspended Ceiling l Clear height – min 2.75 m floor to ceiling, enabling maximum natural light

l Complete & approved fire system scenario according to EU Standards incl. sprinklers l Electricity and HVAC standard design are according to a floor layout of 1 work station to 8 sqm.

Actual design and execution shall be according to Tenant’s approved space planning. l LED lighting in the office space l HVAC system - each office/zone is provided with a fan coil unit (FCU) for cooling/heating l HVAC thermostats (type Siemens RDG100 KN). An option to be programmed by time and controlled by BMS in order to save energy Generator: l 2,000 KVA Generator Capacity Generator Back Up to all Emergency and Safety functions l Generator for Tenant Back-Up enabling 24/7 non disturbance compliance Common areas of the Building: l High Speed Mitsubishi Elevators l Advanced B.M.S (building management system) l LED lighting systems for the common areas l CCTV camera system, access control systems for the building and common areas l 24/7 Security control l 24/7 Firemen on site, according and required by Law. l Green Building LEED GOLD certificate Due to AFI Europe’s green design strategy based on which the buildings were developed, the tenants in AFI Park benefit of an estimated 40% reduction of energy consumption and water use compared to a regular office building “Green is AFI’s new standard and an integral part in developing all AFI Europe office project. We are committed in offering projects built at high standards and energy efficient, assisting our tenants to be Green & too benefit of reduced utilities costs”.

Author: Thomas Herbert

www.business-review.eu Business Review | November 2015

8

Cautious optimism surrounds romania’s growth outlook Three days of panel discussions with experts focusing on Romania’s macroeconomic performance and competitiveness outlook, debates centered around the five fastest growing sectors in the country, over 60 speakers and 450 participants - BR gives you the breakdown of the most important issues debated, as well as forecasts made, during the second edition of its Foreign Investors’ Summit.

All photos: Mihai Constantineanu

From left to right: Ciprian Gorita, senior manager, KPMG; Catalin Homor, general manager, Metrorex; Nicolae Buica, secretary of state, ministry of european Funds; Marius Humelnicu, secretary of state, ministry of transport; Ioana Anca Gheorghiade, executive director, public sector and infrastructure funding BCR; Narcis Neaga, general manager, CNADNR; Cosmin Vasile, managing partner, Zamfirescu Racoti & Partners

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∫ Simona BazaVan otilia haraGa The numbers tell a compelling story.

Romania reported ten quarters of growth out of the last twelve, and its GDP was up by 4.2 percent in Q1 y-o-y alone, making it the best performing economy in the European Union (EU), said Alexandru Nastase, secretary of state with the Department for Foreign Investments and Private Public Partnership. Subsequently, foreign direct investment (FDI) has posted a similarly positive evolution totaling a volume of almost EUR 2.3 billion in the first eight months of 2015, 61 percent higher than the same period in 2014, he added. All this means that “there is no better time for investing in Romania,” went on the official.

But where does this growth come from and is it sustainable? Moreover, are the right conditions in place for FDI to go up even further? Talking about the country’s macroeconomic performance over the past couple of years, Angela Filote, chief of representation of the EC

in Romania said that, while there was consistent growth, it was fueled by internal consumption and exports and less by public investments. “It is true that Romania has had amazing economic growth but let’s look at the source of this growth. One of the reasons for which Romania had low budgetary deficit was based on low investments. And the country cannot grow solely on local consumption and exports because these were the main sources of its economic growth,” commented Filote.

And such investments are vital given the country’s need to develop and upgrade its infrastructure in almost every sector, she added. “Each one of us who travels through this country knows how instrumental, I would say how ultimate, the need for proper infrastructure is. Starting with the transport infrastructure, but almost in any other field, we need investments in infrastructure,” explained the European official. And she was not the only one to point this out. “What is probably missing from the equation in order to make this growth truly sustainable, are the

public investments,” commented Anamaria Mihaescu, the regional manager of the IFC, part of the World Bank Group.

Even so, boosting investments at the price of increasing the public deficit ceiling would be the wrong approach, warned Filote.

“We would see no reason to accept a trade-off between investments and the public deficit, before we see the country making use of all the other available measures. This includes accessing structural funds or the improvement of tax collection. Romania already has the means to increase its capacity to attract foreign investments and it doesn’t need to touch the macroeconomic fundamentals that were achieved through such hardships,” added Filote.

She also commented on recent news about the Romanian authorities’ intention to reach a new agreement with the IMF/EC by saying that she heard about it from the media and that the EC has not been officially approached for discussions. Stressing however, that, even without a new agreement being signed, the EC has the necessary instruments to

1. Dante Stein, secretary general „National Development Strategy 2019“, 2. Valentin Stefan, director, business development, Vodafone Romania, 3. Eric Stab, president, Foreign Investors Council

www.business-review.eu Business Review | November 2015

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keep fiscal consolidation in check. “Romania is part of the economic governance structures of the EU and we have a system of monitoring and of issuing recommendations,” added Filote.

Romania’s efforts to boost foreign investments must also be seen in the larger European context which could offer the country new perspectives for growth, discussed panelists. Compared to the pre-crisis levels, the EU has an investment gap of over EUR 300 billion.

In order to address this issue, the EU has come up with the Investment Plan for Europe, a program that targets the mobilization of some EUR 350 billion in investments over the next years. “We are trying to fill this gap. It is a kind of bet, a challenge that we are throwing into the market, hoping that the private market, the investors will follow,” said Filote.

Weak investments across the continent are holding back the European

wouldn’t like to see, are these achievements get undermined by other types of measures,” she added, hinting at the recent fiscal relaxation and public wage increases announced by the Ponta government.

become more profitable. Privatization would bring money to the country but more importantly, it would increase the productivity, resulting in a much more productive economy,” he explained.

He added that, although he understands that this is not an easy process Worrying signs and that there are political issues that The European Commission (EC) is less go hand-in-hand, accomplishing this optimistic than the Romanian govern- goal would help get the economy movment about the country’s tax collection ing.

Accessing EU funds should be the capacity in light of the recent tax cuts, second priority, he recommended. “Ropointed out Filote.

“We have an optimistic government mania has a lot of money in Brussels and that is a good thing; we only hope waiting to be spent. And you have to that it is not too optimistic. We are less ask the question why it is that you have optimistic about the government’s ca- this money and it isn’t being used? pacity to increase tax collection so that Again, it is a government issue, a politiit can compensate for recently adopted cal issue. How can we get politicians tofiscal measures (…) It would be a pity if, gether to agree to pursue very after such fiscal discipline and such important infrastructure projects? Instrong austerity measures that every- frastructure means growth for this body felt, we were to take a step back,” country,” said the businessman. said Filote.

“it is true that romania has had amazing economic growth but let’s look at the source of this growth. one of the reasons for which romania had low budgetary deficit was based on low investments. and the country cannot grow solely on local consumption and exports because these were the main sources of its economic growth,” says Angela Filote, chief of representation of the EC in Romania. economy and are leading to a sluggish recovery and little change in the high unemployment levels. “Our first and utmost priority is to create jobs in the EU. As you know, the EU has 28 member state, but the crisis has created a 29th member state which is the member state of the unemployed; we have 25 million people that cannot find a job in the EU. And this is not something we can afford,” said the official.

The Investment Plan for Europe, the efforts to create an energy union, the completion of the single market that would enable the creation of a fully functional digital market - all these are initiatives looking to create more jobs in Europe and are possible growth engines for Romania as well, argued panelists.

However, maintaining macroeconomic stability remains a key element for future investments of any kind.

What presently advocates Romania to foreign investors are its macroeconomic growth and stability, mainly the result of three financial programs with the International Monetary Fund (IMF), the World Bank (WB) and the EC, said Filote. “And all this success was not easily achieved. It was a huge effort for the country, for companies, entrepreneurs and ordinary citizens. And what we

She stressed that the EC is not against fiscal relaxation but that such measures need to be well-timed and implemented properly. “We are looking at every measure of this type. Why? We are not against such measures. We are in favor of all these measures if they are taken at the right time and with the right compensatory measures so that what this country has achieved and made it such a great country to invest in is preserved and that the investments keep coming,” she stressed.

romania needs privatization and EU funds to accelerate growth, says mark mobius Privatization of state-owned companies and accessing EU funds are the two things that would help Romania accelerate growth, said Mark Mobius, executive chairman of Templeton Emerging Markets Group, during the first day of the event.

“Privatization is the number one thing that should be done. We are now in a situation when we have these huge state-owned enterprises which are still majority-owned by the government and are therefore not willing to change, not willing to reform, not willing to become more efficient and not willing to

the ever-missing infrastructure Romania has made considerable progress over the past years in creating an investor-friendly business environment, but there is still work to be done, argued panelists. "There are three directions Romania needs to focus on in order to attract more investments: improve the business environment, improve infrastructure and improve good governance," said Ismail Radwan, lead public sector management specialist with World Bank Romania.

Of the three, infrastructure development, and road infrastructure in particular, has proven the trickiest and most elusive goal to achieve for Romanian authorities so far. According to WB estimates, Romania needs some EUR 16 million to develop its road infrastructure, out of which only EUR 4 billion is available in EU funds between 2014 and 2020. Absorbing the existing funds and finding alternative financing sources thus becomes crucial, stressed Radwan.

Romania could also learn from the experience other countries have with public-private partnerships in order to speed up the rollout of large infrastructure projects, such as the construction

4. alexandru nastase, secretary of state, Department for Foreign Investments and Private Public Partnership, 5. angela Filote, chief of representation of the European Commission in Romania, 6. ismail radwan, lead public sector management specialist, World Bank Romania, 7. mark mobius, executive chairman, Templeton Emerging Markets Group, 8. Claudiu Petre, manager, structural funds & business development projects, Telekom Romania, 9. Varujan Pambuccian, member of the commission for information technology and communications of the Chamber of Deputies, 10. razvan iorgu, managing director, CBRE Romania

www.business-review.eu Business Review | November 2015

of highways, said Ioana Anca Gheorghiade, executive director public sector and infrastructure funding with BCR.

What else beyond low costs?

Low costs, location and energy resources are the main three reasons that make Romania attractive for investors according to the EC data. “Out of these, I have a problem with the low costs. I don’t think Romania can afford having as one of its main advantages the low costs. And I don’t think it is fair to Romanians,” commented Filote.

There is increasing and understandable pressure to raise salaries, however, this must be the result of increased productivity and competitiveness, which in turn are the result of investments in medium- and high-value-added technologies, she added. The Romanian economy is dominated by low- to medium-tech sectors with several hightech “islands” but, even the latter do

11 general manager, Dacia Renault Romania.

IT and telecom in particular are sectors that can boast a well-trained and competitive workforce, said company representatives. “That fact that we export workforce within the Vodafone group is proof that that we have highly competitive, technologically-trained employees,” said Valentin Stefan, the director of business development at Vodafone Romania.

Car industry calls for labor code flexibility Modifying the present labor code and introducing new measures that would make it less flexible than its present form is worrying investors, discussed participants during the event.

“I am particularly worried by the intention to modify the labor code. This intention is tacitly passed through Senate. It would be a terrible setback for

Romania’s First Car program does little to boost new car sales as it offers potential buyers the same terms as regular loans, said Stroe. “Romania is importing three used cars for every new car being sold. It is crucial to find ways to restart the domestic market,” added Maure.

The government-backed First Car program is meant to stimulate new car acquisitions but producers say it should be changed to increase the lending period beyond five years and offer lower interest rates. Such measures are crucial to support the market given that lowering the VAT from 24 percent to 20 percent would have little effect to boost new car sales, added Stroe.

“We have a very weak market for new cars. It is absolutely abnormal to have two producers like Renault and Ford sell only about 6 percent of their production in Romania. Imagine that if they wouldn’t export, they would need

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“there are three directions romania needs to focus on in order to attract more investments: improve the business environment, improve infrastructure and improve good governance,” says Ismail Radwan, lead public sector management specialist with World Bank Romania.

14 not invest enough in research & development (R&D) and innovation, according to EC data. “R&D has been identified at the EU level as the engine of change for improving competitiveness. It is a problem across the EU, but even more so in Romania,” said the chief of the EC in Romania.

The challenge for Romanian authorities is to come up with a model that would enable salary increases without losing the country’s attractiveness for multinationals and foreign investors in general, she added. “That means that wages must go up responsibly in-line with productivity. Romania must focus on structural policies for improving productivity, with a view of restoring competitiveness. And this is the main challenge for the medium and long term, according to our assessment. It requires transition to sectors with high technologies and value-added because Romania needs to find shortcuts in order to catch up with more developed economies in the EU, which are themselves in a continuous process of development,” concluded Filote.

And this has already started to happen, according to some investors.

"Times are changing here in Romania because we can no longer rely on competitive low costs. This is no longer the case. And we can also no longer rely on a strong domestic market. This means we need to look for higher value-added activities," explained Nicolas Maure,

progress in the industry,” said Constantin Stroe, the president of the Romanian Association of Car Producers – ACAROM. Some of the possible changes that could be brought to the labor code include the reintroduction of collective labor agreements, increasing the cost of overtime from 75 percent to 175 percent and setting individual performance targets through collective negotiations, explained Stroe.

Investors, too, have expressed concerns over a possible change of the labor code. “Labor costs are increasing in Romania. It is still competitive, but it will be converging gradually to Western European levels. So the only way to compensate this is to bring added value and to keep flexibility. The current labor code that was implemented starting 2011 is a good one (…). It would be extremely risky to challenge this and to introduce a new labor code without the proper dialogue taking place between employers, the unions and the civil society,” said Maure.

The availability of local labor force and its qualification remains one of the most important criteria when a company looks at setting up manufacturing facilities in Romania, stressed Dana Bordei, the head of the industrial department of CBRE. Car industry representatives have also talked about the need for more government support for the domestic new cars’ market.

to keep production units working for only two weeks per year” went on Stroe.

Increasing the financing capacity of the Rabla program (“Cash for Clunkers”) would also help stimulate new car sales, a much needed measure given that there are over 3.5 million cars in the country that are over eight years old, added Maure.

not yet a regional energy hub Romania could “in theory” evolve into a regional energy hub and it could play an important part in the EU’s Energy Union project, given its conventional energy resources and green energy potential, said Daniela Lulache, CEO at Nuclearelectrica. However, low levels of interconnection and low electricity prices are hindering this potential, she explained.

“Even if we assume that we don’t have a market problem, then we definitely have a regulation problem. It is a reality of the EU that electricity prices are low and this makes any large scale investment project unsustainable,” she explained. She added that Romania can be independent from the oil and gas perspective as it is the only country in EU that benefits from an integrated nuclear energy production cycle from uranium mines to production.

Speaking about the potential of the local energy market Artur Stratan, president of ROPEPCA said that Romania needs massive investments in both pro-

11. George turtoi, secretary of state, Ministry of Agriculture and Rural Development, 12. George Stan, chief investment officer, Teamnet Group, 13. mihai macelaru, associated partner, Noerr, 14. Dan Bota, head of small business division, Intesa Sanpaolo Bank, 15. matteo Patrone, director, EBRD Romania, 16. George Stanson, business manager for Romania, Bulgaria, Croatia, Serbia, Case IH&Steyer Balkans, 17. nicolas maure, general manager, Dacia Renault Romania

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duction and exploration fields. According to him, about EUR 8.5 billion have been invested in Romania in the two sectors in the past 12 years. Also Martin Zmelik, CEO at CEZ Romania Group said that there are a lot of opportunities in the distribution sector in terms of more complex solutions for customers.

“But it is also important to provide more complex products in the electricity sector. Our main directions are represented by solutions in distribution and new technologies around renewables,” he said.

And indeed, new technologies are boosting growth throughout the industry, from production to final consumers, added Daniel Bobu, director, enterprise marketing, enterprise business unit at Vodafone Romania.

agricultural productivity increases but still below potential, say investors

buy 5,000 hectares, 10,000 hectares or 20,000 hectares of farmland that this land will be scattered across several villages,” said Mihai Macelaru, associated partner with Noerr.

Despite such setbacks, more and more entrepreneurs and companies are venturing to invest in farming businesses and banks are more willing to cater to their financing needs. “Why are banks investing now in agriculture and why more than before? It is not something that we have discovered overnight. What has happened is that businesspeople are starting to capitalize on the existing potential. Therefore, it is only normal for banks to make their presence increasingly more felt,” explained Dan Bota, head of the small business division with Intesa Sanpaolo Bank.

With financing becoming more available, the industry is projected to step up its growth by enabling farmers

limited pipeline to cap 2016 real estate investment volume One of the hardest hit sectors in the aftermath of the 2008-2009 financial crisis, the real estate industry, has resumed growth and is once again on investors’ radar. All real estate segments have gone up over the past 12 months, said industry representatives.

Office in particular, but the industrial and logistics markets, have all been posting positive results, pointed out Florin Furdui, the country manager of Portland Trust.

In the retail segment, consumption has also been going up, and developers are ready to cater to new demand, said Tal Roma, business development manager, Afi Europe Romania, stressing however, that optimism should remain cautious. Even the residential market has been resuming growth. “It has clearly overcome its lowest point and it

"times are changing here in romania because we can no longer rely on competitive low costs. this is no longer the case. and we can also no longer rely on a strong domestic market. this means we need to look for higher added value activities," says Nicolas Maure, general manager, Dacia Renault Romania.

Romania has taken concrete steps to- to have an integrated approach to pro- is now on an upward trend,” comwards improving its agricultural pro- duction and thus boost productivity. mented Adrian Erimescu, the coductivity over the past years, albeit “In order to post yields that are higher founder and CEO of online real estate progress remains slow, discussed par- than the average of about four to five platform Imobiliare.ro.

After real estate investments totaled ticipants at the agriculture conference. tons per hectare reported presently for One problem that continues to hinder crop production, and reach at least some EUR 950 million in 2014, this year productivity is land fragmentation, seven, eight tons per hectare, one the volume is expected to reach apsaid George Turtoi, state secretary with needs to focus on all the inputs in- proximately EUR 800 million – EUR 850 the Ministry of Agriculture and Rural volved in the process,” said George million, said Laurentiu Lazar, the direcDevelopment. “About 80 percent of Stanson, business manager for Roma- tor of investment and valuation servthe country’s farmland is divided nia, Bulgaria, Croatia and Serbia with ices at Colliers International Romania.

However, it is hard to make forecasts among farmers who own between one Case IH & Steyer Balkans.

Increased productivity, accompa- beyond 2015, argued real estate panand five hectares. There are some 800,000 such farmers,” he said. With nied by the creation of local value- elists.

“I am less optimistic for 2016 because the new National Program for Rural added production chains would enable Development (NPRD) and new rules more and more farmers to reach the I don’t see the necessary pipeline for for allocating subventions, the author- shelves of large retail chains, argued such transactions. It is there, but it less ities are hoping to change this by offer- participants. For example, some 98 obvious than the 2015 volume was, ing farmers incentives to create and percent of the private label grocery back in 2014,” explained Francisc Peli, join cooperatives and producer groups. products that Carrefour sells in Roma- partner with the PeliFilip law firm.

The average transaction value has Such measures include offering a sub- nia are produced locally, says the residy level higher by EUR 45/hectare for tailer. “We are working with more than changed, and investors are presently infarms or associations that own be- 780 local producers who supply us terested in deals of about EUR 30 miltween five and 30 hectares, said the of- mostly with fruit, vegetables and tradi- lion – EUR 40 million, said Lazar. ficial. Farmers who opt to join forces in tional products,” said Florin Capatana, “There aren’t really that many products such an association also benefit from director corporate affairs & sustainable left on the office market, and on the in20 percent more funding for invest- development, Carrefour Romania. dustrial segment there are even fewer,” Such progress remains slow, but he added. ments and dedicated application procedures in the NPRD for 2014-2020, there are positive developments in the And the industrial segment in parindustry, argued participants. “We see ticular has seen a considerable number went on Turtoi.

Until some of these measures pro- a very encouraging change. If things of investment transactions over the duce effects, land fragmentation re- will continue in the same direction, in past year as the market has posted overmains a problem for both local and 2020 we will probably be able to talk all improved results. 2015 has been “a foreign investors. “It is very hard to ex- less about potential,” concluded Stan- very interesting year” for the industrial plain to an investor who is looking to son. and logistics segments, with the leasing

18. Valerio Brenciaglia, managing director, Ford Romania, 19. ana maria mihaescu, regional manager, IFC, 20. Constantin Stroe, president, Acarom, 21. iulian Sorescu, associated partner, head of financial department, Noerr Finance and Tax, 22.

Dana Bordei, head of industrial department, CBRE, 23. adrian Erimescu, co-founder, CEO, Imobiliare.ro, 24. Florin Furdui, country manager, Portland Trust

www.business-review.eu Business Review | November 2015

activity projected to reach 300,000 sqm – 350,000 sqm by year end; however, much of this year’s results were the result of projects that were kick started as far back as two years ago, said Marian Orzu, business development executive with the industrial agency of CBRE Romania. “If before the crisis the negotiation time for closing a transaction was of about three to four months, now it takes at least six months and can take as long as two years. This is why on the industrial market we see a really good year sometimes followed by a more regular one in terms of performance,” he explained.

Nevertheless, the overall optimism about the industry needs to be moderate in order to make sure that past mistakes will not be repeated, argued participants.

“I, too, am optimistic about the real estate market, but I do have some reservations. They have to do with the fact

13 “There are two fields that are opening up right now in the third industrial revolution that will need financial and networking support. The first is that of additive manufacturing. I have submitted a rather ambitious national plan for this, which I hope will be approved; it is a plan for half a billion EUR for the next 5 years which should go to the education area because we need to train people over the next 10-15 years. A second program, that is very suitable for Romania that I have not yet submitted for approval, is a project for bioinformatics.

Since June 2014, synthetic DNA can be patented in the US. These are the top priority things for me over the next period of time: moving the software industry in the intellectual property production, increasing additive manufacturing and the bioinformatics area,” said Pambuccian.

He also added that these developments require some help from the state,

schemes.

“Financing percentages have remained very high, even in the second round of state-aid schemes. Except for Bucharest, with 15 percent, and the cities in the western part of Romania, with 35 percent, the rest of the country can benefit from 50 percent financing percentages. This is a great accomplishment for Romania, compared to other countries that could not keep this financing level in the second round,” Iulian Sorescu, associated partner, head of financial department at Noerr Finance and Tax said during the Foreign Investors Summit event organized by Business Review.

He recommended Romanian companies to hurry, if they wish to attract state financing, because the next 2-3 years are critical for attracting these funds.

However, entrepreneurs, such as Peter Barta, CEO of the Post Privatiza-

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“Even if we assume that we don’t have a market problem, then we definitely have a regulation problem. it is a reality of the EU that electricity prices are low and this makes any large scale investment project unsustainable,” says Daniela Lulache, CEO at Nuclearelectrica.

28 that we find ourselves in a period when but not too much, because the main tion Foundation, said the IT commuthere suddenly is a lot of money avail- need is that of networking in major nity feels the need also for other types able and investors, who have been frus- markets and this cannot be solved ex- of financing. Barta said that the Romantrated for years because they lacked the cept through the effort of a community. ian market is still immature and comparesources to develop their projects, are “In Romania, to build a community is nies are very dependent on this form of state aid. now able to do that. I am concerned, work for Sisyphus,” he said.

“I don’t believe state aid is the best however, that not all of them ask themOne field that is growing in imporselves if there is demand for those proj- tance and will soon be in need of regu- way to finance a whole sector. I would take the EUR 140 million and put them ects and that we will once again begin a lation is that of drones. cycle when we hurry things up and we “Fitting legal measures must be put into an investment fund.” He added, skip steps,” warned real estate entrepre- into place concerning the drones. This “Romania is one of the few countries in neur Ovidiu Sandor. area should be regulated, just like all the the region that does not yet have a sovThe Romanian IT industry needs to others, because after all, this will pose ereign fund where state resources prepare for the next steps in its devel- traffic issues. It is clear as day that an air should be put. It needs a fund of the opment as, 15 years from now, the IT job traffic code must appear,” according to venture capital type. Most of the investments made in Romania are private eqmarket will look completely different. Pambuccian.

Pundits at BR’s Foreign Investors SumOn the other hand, George Stan, uity. We are specialized in mergers and mit previewed what projects are in chief investment officer at Teamnet acquisitions, but we do not have instrustore, such as drone traffic regulations, Group, a Romanian company that man- ments in the fund domain,” said Barta.

One way to make progress is to inadditive manufacturing or bioinformat- ufactures drones locally, said that at Euics. The efficiency of several state-im- ropean level, efforts are being made to vest a great deal in education. “Going plemented measures, such as state-aid establish new rules and regulations in from saving cash under your mattress schemes or the tax exemption for pro- this field. He also said some security to multiplying your wealth by making grammers were also up for debate. measures are in order until the technol- investments on the stock exchange reAt the moment, the bulk of things ogy becomes mature. He said that in quires a great deal of education,” said that are produced by the Romanian the drone business, there are currently Barta.

He also said that the Business Angel IT&C industry in Romania are produced three main areas of interest: the toy for export. There are some things that drones, the military fields and the mid- law that was adopted last year by the are produced for the internal market, dle field, which is where Teamnet parliament is not functional and will especially for the state, because the Ro- stands, and where there is a great deal not be functional because of over-regumanian internal IT market is dominated of promise. “We are the first Romanian lation. “What is dragging us down in by the state. This is not a healthy devel- company that exports services based this field is the over-regulation and the opment formula, according to Varujan on UAVs (unmanned aerial vehicles) lack of vision,” said Barta.

Pambuccian, member of the Commis- made in Romania,” said Stan. sion for Information Technology and At the moment, the development of simona.bazavan@business-review.ro Communications of the Chamber of the Romanian IT industry is substanDeputies, who opened the debate. tially supported through state-aid otilia.haraga@business-review.ro

25. ilinca Paun, managing director, Colliers International Romania, 26. laurentiu lazar, director investment and valuation services, Colliers International Romania, 27. Francisc Peli, partner, PeliFilip, 28. ovidiu Sandor, entrepreneur, 29. martin zmelik, CEO, CEZ Romania Group, 30. Daniela lulache, CEO, Nuclearelectrica, 31. Daniel Bobu, director, enterprise marketing, enterprise business unit, Vodafone Romania

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14 EDUCation

montessori schools on the rise in romania Private schools are a flourishing business in Romania because they meet an acute market need, believes Ana Maria Brezniceanu, founder of Montessori School of Bucharest, and receiver of the November 2015 US Embassy “Entrepreneur of the Month” award. ∫ anDrEEa tint Private schools are a flourishing business in Romania because they meet an acute market need, believes Ana Maria Brezniceanu, founder of Montessori School of Bucharest, and receiver of the November 2015 US Embassy “Entrepreneur of the Month” award.

Brezniceanu started the Montessori Kindergarten in Bucharest in 2007; at the time, it was the first of its kind in Bucharest to be authorized by the Romanian Ministry of Education.

“This kindergarten was started with borrowed money,” said Brezniceanu at the conference where she received her award from US Ambassador to Bucharest Hans Klemm.

In Romania, almost 50 percent of entrepreneurs self-finance when starting their business, using money put aside while being employed, according to a 2014 survey from Banca Romaneasca.

Initially, Brezniceanu’s school had only eight students in one kinder-

garten group; it has now grown to eight groups of children aged between two and twelve. “Each growth took effort because in order to open a new group/class it is necessary to send a teacher to a Montessori course,” stated Brezniceanu.

The Montessori Method emphasizes the potential of the young child and develops this potential by using specially-trained teachers and special teaching materials, according to the Montessori School website. The employment of the method is relatively limited as an alternative to traditional education in Romania. The Association for the Development of Montessori Education in Romania (ADEMR), affiliated with the Association Montessori Internationale (AMI,) created by Maria Montessori, lists only eighteen kindergartens and schools throughout Romania that have teachers trained through AMI courses.

Unlike the Waldorf and Step-byStep methods that “have a longer tradition in Romania and are already well-known, especially since they first

entered the public sector when other,” she commented.

Asked about the pricing of the Montessori first started, the parents we came in contact with didn’t know Montessori School, Brezniceanu said much about the Montessori education,” that the taxes vary according to schedsaid Brezniceanu. “Now parents come ule type, number of siblings enrolled payment method informed already, also because more and Montessori kindergartens have (monthly/term/yearly.) “I am trying opened up and they all have explana- very hard to keep the tuition fees at a tions on their websites. Moreover, level accessible to the middle class,” ADEMR organizes conferences for par- she stated.

Through the “Entrepreneur of the ents and the Montessori Method has become considerably more visible,” Month” award, the US Embassy aims to highlight those individuals who she added.

Of the Montessori School’s devel- “have seen the potential of a new or opment since 2007, Brezniceanu said emerging business idea or opportunity, that “each growth [in size] was organic, and then developed a focused apfollowing demand from the parents.” proach with drive and courage to turn As for the school’s prognosis for the that idea into reality,” stated the amnext years, she intends to grow the bassador. “The purpose was to help inbusiness along with the children, spire other entrepreneurs in Romania, adding another class for 6-9 year olds, but then also to create a bond between another for 9-12, and to open a new those entrepreneurs and the United school for the next school cycle, States,” which could eventually lead to twelve to fifteen year olds, when the “opportunities for those entrepreneurs current 9-12 year olds graduate. “I pre- to do business in the United States,” fer to thoroughly take care of each further added the ambassador. child, to be able to talk to each parent, to get to know and understand each andreea.tint@business-review.ro

16 COVER STORY

www.business-review.eu Business Review | November 2015

∫ ANDA SEBESI

When a fire extinguishes lives and a government

Photo: Mihai Constantineanu

The tragedy at Colectiv nightclub in Bucharest had the power to bring 20,000 people out into the streets of the Capital and change the Victor Ponta government. Additionally, an entire live concert and nightclub industry has been hit, as the safety of public places became a top priority for Romanians. Business Review talked to specialists and presents a comprehensive analysis of what the Colectiv tragedy really means for the whole political scene and its longterm implications for the business environment, as well as the local economy.

At the beginning of November, Romanian Prime Minister Victor Ponta resigned after 20,000 people took to the streets to protest over the Colectiv nightclub fire that killed 27 people in a first instance. The fire on that Friday night in Bucharest started when Goodbye to Gravity, the rock band performing at the club, set off fireworks inside.

The resulting protests in the streets called for Ponta to step down, complaining of government corruption and poor safety supervision measures. "I'm handing in my mandate; I'm resigning, and implicitly my government as well. I hope the government's resignation will satisfy the people who came out into the streets," Ponta said in a statement.

In September, Ponta became the first sitting Romanian prime minister to go on trial charged with corruption. He faces allegations of fraud, tax evasion and money laundering, but he denies the charges and has accused prosecutors of being "totally unprofessional."

According to BBC.com, President Klaus Iohannis, who has repeatedly called on Ponta to step down since the corruption scandal unfolded in June, called for a "sea of change" in Romanian politics in the wake of the resignations.

He also said that the club tragedy had "affected the nerve of the nation." As a result of the resignation, President Iohannis has named Dacian Ciolos prime minister who, in turn, recently announced his list of government representatives and received the green light from the Parliament.

According to Erste Group analysts, the fiscal relaxation measures taken by the former government, led by Victor Ponta, continue to be a risk for 2016.

“Considering the wide political consensus with which such decisions have passed, we don’t expect them to be reversed. However, the new government could come out with a series of measures meant to keep the consequences made by the excessive decisions under control,” says a note from Erste Group, quoted by Mediafax. The former government cut taxes on special constructions and, since June, the VAT for food has been reduced to 9 percent. In addition, starting January 2016, the standard level of VAT will be cut from the current 24 percent to 20 percent and by 2017, it will reach 19 percent. Additionally, the new fiscal code eliminates the additional excise on fuel.

Erste analysts say that the government change is a positive incident, despite the fact that miracles cannot be expected overnight. “After the new government sets in, the majority of fiscal decisions should be validated by the same Parliament,” they say.

The current Romanian political situation, along with the creation and setting up a program for the new government, have been one of the many discussions that Dacian Ciolos has recently had with the president of the European Commission, Jean Claude

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Juncker, and the president of the European Assembly, Donald Tusk.“First of all it was a cordial meeting but we also discussed the political situation in Romania, the creation of the new government and especially the governance program as we will soon negotiate with the European Union about the budget,” stated Ciolos for Mediafax.

What investors say?

According to the Romanian-German Chamber of Commerce and Industry (AHK Romania,) the resignation of the Romanian Prime Minister Victor Ponta could boost investor trust because it is seen as a success in the fight against corruption. “We hope that things will change and improve. A step down is not quite a basis to create trust, but there have been too many doubts of corruption that hovered over the Ponta government. A new government could bring a new wind and regain the trust of

COVER STORY 17 the business environment.” Furthermore, they add that the priorities of the new government should be the same as those of the previous one: stability and predictability, especially of the legal framework, fight against corruption, infrastructure, reform of the educational system and increase of the absorption of the European funds.

Elsewhere, Robin van Rozen, president of The Netherlands Romanian Chamber of Commerce (NRCC) says that the institution he manages considers political stability and economic growth as being deeply interconnected.

“A stable political climate, a consistent and transparent tax regime, and a predictable legal environment for businesses are key factors for building investor confidence and driving sustainable economic growth.” He adds that the NRCC welcomes further steps made by the Romanian authorities to ensure a competitive business environ-

Ciolos’ list The newly appointed PM Dacian Ciolos announced the 21 members of his Cabinet at the end of last week. When presenting his members, Ciolos said that he had chosen them based on their experience, qualifications, vision and ideas. He also said that one third of his Cabinet is formed by women Ministers.

Name Costin Grigore Borc Vasile Dincu Lazar Comanescu Petre Toba Mihnea Ioan Motoc Anca Dana Dragu Paliu Achim Irimescu Victor Vlad Grigorescu Adrian Curaj Vlad Alexandrescu Aura Carmen Raducu Raluca Alexandra Pruna Cristina Pasca Palmer Claudia Ana Moarcas Marius Raul Bostan Patriciu Achimas Cadariu Elisabeta Lipa Marian Dan Costescu Victoria Violeta Alexandru Dan Stoenescu Ciprian Bucur Ioan Dragos Tudorache

Portfolio Vice prime minister and minister of Economy, Commerce and Tourism Vice prime minister and minister of Regional Development and Public Administration Minister of External Affairs Minister of Internal Affairs Minister of National Defense Minister of Public Finances Minister of Agriculture and Rural Development Minister of Energy, SMEs and Business Environment Minister of Education and Scientific Research Minister of Culture Minister of European Funds Minister of Justice Minister of Environment, Waters and Forests Minister of Labor, Family, Social Protection and the Elderly Minister of Informational Society Minister of Health Minister of Youth and Sports Minister of Transportation Minister Delegate for Social Dialogue Minister Delegate for Romanians abroad Minister Delegate for the Relation with the Parliament Chief of the PM’s Chancellery

OPINION Mihaela Vechiu Psychologist

“I think that, in general, the attitude of the consumers of nightclub entertainment is different. Colectiv was an underground, alternative nightclub.

There are old locations, well-known in Bucharest in this segment, where students and youngsters prefer this kind of entertainment. They are open to specific types of music and venues despite the fact that they don’t offer the best conditions. However, no one has thought of their condition so far because these locations were attractive just for the type of entertainment they offered through events or their atmosphere. Nightclub entertainment is a social need for people. A nightclub is a social space where people meet and express their feelings free. While for some a nightclub is a place where they express their need to be seen and noticed, for others it is a place where they feel free of other day-to-day issues and want to have fun with their friends. ment. “In this regard, highly important is the continuation of policies aimed at maintaining macro-economic stability and strategic investments in priority sectors, particularly infrastructure, health, education and agriculture,” he concludes.

But Daniela Nemoianu, president of AmCham, says that the recent political developments are symptomatic of chronic and more profound reasons.

“Such gaps and multiple ruptures accumulated in time are difficult to surmount and directly affect the economic environment through their impact on the budgetary balance, the uncertainty of the perspectives of development,

The Colectiv tragedy is an unprecedented event that has raised a strong warning signal about the safety in public places. This can influence the perception of the Romanian consumer as he or she becomes more selective with the places where he or she chooses to go. If before this tragedy they chose a nightclub based on their musical preferences and their preferred type of entertainment, these criteria can be influenced now. Their behavior can differ also depending on their age, preferences and type of entertainment. I noticed some opinions that show that many individuals became more careful about the places they went to, avoiding those that are closed, improper, obscure and stuffy and adopting a more responsible attitude about their personal safety. I have also seen individuals that are indignant and who’s trust in public space in general, and underground nightclubs in particular, has been affected. I have even noticed a focus on outdoor social activities that are different from the nightclub entertainment. For sure, the Romanian consumers of nightclub entertainment will change their selection criteria when choosing the way they spend their time. People have never been aware of the danger and their need to be safe in public places as they are now. The consumers’ needs can be redefined focusing on basic needs like security in addition to the social ones, avoiding more and more low quality locations.” lack of stability of institutional mechanisms and of integrated strategic lines.”

In her opinion, a governmental rule based on competence and performance, with an agenda of national strategic priorities and zero tolerance towards corruption are legitimate expectations of both the business environment and civil society, regardless of the duration of the mandate of the political platform.

As for the priorities, Nemoianu says that there are many, but it is advisable that any measures be filtered by strategic relevance, economic efficiency and budgetary sustainability, considering the trans-sectorial alignment. “Albeit, we speak about a short-term mandate,

Who is Dacian Ciolos Between 2010 and 2014, Dacian Ciolos has been the European Commissioner for Agriculture and after his mandate expired, Jean-Claude Junker, the president of the European Commission (EC,) appointed him as special counselor for food safety.

Between October 2007 and December 2008 Ciolos was the Minister of Agriculture, as part of the Tariceanu Cabinet. Between 2005 and 2007, he was the counselor of the Agriculture Minister, also representing Romania in the special commission of the European Union Assembly on Agriculture. Previously, between 2002 and 2003, he worked for the Delegation of the EC in Romania, preparing the implementation of the SAPARD program. He graduated from the University of Agricultural Sciences and Veterinary Medicine of Cluj. His educational background also includes studies of agronomy at École Nationale Supérieure Agronomique (ENSAR) of Rennes. Since 2000, he holds a PhD in the economy of agricultural development, agro-food and rural at the National Institute for Agronomy Research within ENSAR Montpellier.

www.business-review.eu Business Review | November 2015

18 COVER STORY the importance of this moment is crucial from the general perspective and that of Romania’s development.” She adds that there are some Gordian knots that need to be rushed in order to immediately unlock European funds, accelerate the reform of public acquisitions, support the major infrastructure projects and those that bring competitive advantages to Romania (ELI, Danube Delta, Digital Agenda, energetic security.)

Pundits say that the change of the government will most likely create a delay in decision making until the new ministers discover the challenges of their respective portfolios. “Due to the short tenure of the government, until the next elections, it is likely that it will act as a temporary caretaker and not engage in significant policy changes. It is therefore likely that any significant public project or investment could be delayed. It will be a transition period,” says Ramona Jurubita, partner, head of tax and legal service at KPMG Romania.

As other business environment representatives, Jurubita says that the new government should focus on fiscal stability, infrastructure and reform of public administration. She adds that, while the new Fiscal Code and Fiscal Procedure Code have been passed, apparently bringing greater stability to the business climate, amendments have already appeared. “Whether or not these are necessary is debatable, but they unfortunately demonstrate a continuation of the past - frequent changes to legislation at short notice. So the new government should make a break from this and focus on stability,” says the KPMG representative.

Statistics issued by the IMF last year revealed that motorway density is ten times lower than in Slovenia and five times lower than in Hungary, while the railways are also in urgent need of investment. “Where the financing sources are still available, the government should push forward with the finalization of projects. Moreover, there should be a much better take-up rate of EU funding, much of which is available to finance infrastructure projects.

Greater private sector involvement should be encouraged, such as PublicPrivate Partnerships.” She warns that all delays in public investments are paid for by all citizens through the reduced standard of living. “Just as we are paying now for the shortfalls in investment a few years ago, we will be paying for the current reduced public investment in the coming years – as an example, investors will choose other countries with better infrastructure and safer public finances instead of risking investing in a country where public investment is cut but populist measures are introduced in the run-up to an election,” concludes Jurubita.

The fire that spent a government Fire tore through a nightclub in Romania on the night of October 30th during a rock concert that promised a dazzling

pyrotechnic show, killing at least 27 people on the spot and injuring an additional 200 people, The Associated Press reported. Actually, it was the spark for a series of six days of street protests that succeeded in changing the Ponta government.

The international press notes that the club had advertised a concert by a local rock band, Goodbye to Gravity, on its Facebook page. The band was playing from their new album, “Mantras of War,” the club said, and the show was to include “a customized light show and pyrotechnic effects.” The fire at Colectiv broke out as some 400 people gathered for a free rock concert around the stage where the band was playing.

The club's single exit was overwhelmed in the panic that followed.

Three weeks after the Colectiv fire, 57 people have died and dozens are still in the hospital, many in critical or very severe condition. The nightclub went up in flames in just ten seconds because of the pyrotechnic effects that set its roof on fire. According to the preliminary results of the post-mortem examinations, the carbon monoxide, smoke and toxic gases poisoning have been the main cause of death. Paul Brummel, the UK Ambassador in Bucharest stated earlier this month that he had been in first contact with the Romanian authorities regarding the nightclub fire shortly after the tragedy when he called for emergency services. He also explained that two British doctors – Sarah Pape, a surgeon specialized in burn marks and Keith Judkins, specialized in physiology and intensive care – have come to Romania to help the victims. The three owners of the club – George Alin Anastasescu, Paul Catalin Gancea and Costin Mincu have been arrested amid allegations that the venue was overcrowded, lacked the required number of emergency exits, and may not have been authorized to hold such a concert.

OPINION Dragos Cabat Managing partner, RisCo

“The change of the government, as any other source of political imbalance, always has both very short, medium and long-term effects. In the first days after the Ponta government fell, the political imbalance hit the exchange rate immediately: the Romanian leu has depreciated on euro quite rapidly. This situation continued until there were clear signs on the market that a future technocrat government had chances to be validated by the Parliament.

But for the next months, the effects of the current political crisis will continue to show. Therefore, the uncertainty about the breadth of the changes of the central public administration determines some blockage in the administration, especially when it comes to public investments. Until the new ministers understand the bureaucratic system they are to manage and adapt to, whatever their expertise, some time will pass during which the important decisions will be frozen.

Then, depending on the performance

of each minister and the government as a whole, it is possible to see some positive effects in the economy, especially at the level of foreign investments and the relationship with the European Union. Actually, I think that due to the substance of this government, the relation with our partners from the EU will have the most to gain and let’s hope that the attraction of European funds as well.

The new government has a big problem: it needs to adapt to a budget that doesn’t belong to it -and without explicit political support – it cannot change many issues related to the expenses without the consent of the Parliament. So, managing the budgetary deficit when the tax cuts and salary increases will hit hard, the budgetary balance will become “the zero priority.”

Then, maintaining a close relation (or rather recreating the bridges) with the European international financers and IMF is crucial for keeping Romania’s credibility in front of our partners, in such a stressed international economic and political situation. Third, a clear objective of the new government must be to assure the economic growth that will generate enough budgetary incomes. Last but not least, the limitation of the corruption and a more transparent act of governance and management of resources represent a request of the civil society and an extraordinary chance that this technocrat government has – and it would be good not to lose this chance.”

from ISU easily exceeds one month. thus far.

Catalin Davidescu, founder of Dark “Hundreds of locations that are now soSide Entertainment says that we can’t liciting authorizations have hundreds The local nightclub market is talk about an impact of the Colectiv of employees and thus, families. If tragedy on the rock concert industry, these locations aren’t open and funcshaken The fire at Colectiv generated a series of but of a total setting a drift of it. “At tioning, hundreds of families lose their inspections made by the city hall and present the majority of bands and their source of income. I think that soon this also a wave of self-initiated closings of staff are unemployed. This tragedy just will become a social problem,” says the nightclubs both in Bucharest and other doubled the existing problems that we representative of Dark Side Entertainmajor cities in Romania. The first in the already had: excessive taxation, lack of ment. He is also the initiator of the series was Expirat, a nightclub in the material basis and the financial inca- #impreunarezistam (“together we Old Town in Bucharest. The announce- pacity of the market in general,” he stand”) support group for the victims ment was made two days after the says. He warns that the Romanian of the Colectiv tragedy. “The RomanColectiv tragedy by its owner, Andrei clubs, especially those that constantly ian rock community is one of the oldest Sosa. “Since 2003 I have put in danger organized live concerts are extremely and most united ones. So far, with the thousands of lives, weekend after affected. “We agree and welcome the help of the Estura foundation, we manweekend and sometimes even during security measures imposed by the local aged to fundraise significant amounts the week. I quit. Expirat in Bucharest is authorities, but unfortunately, they are of money that will be totally directed closing because now I can no longer as- not ready to manage the huge number towards the families of the victims.” sume responsibility for people’s lives,” of requests for ISU authorization,” says But, he says that this is not all. “We will try as much as possible to militate in posted Sosa on Facebook. Cluj-Napoca, Davidescu.

He adds that, according to his part- favor of the changing of the legal Iasi and Brasov are other cities where owners have decided either to cancel ners abroad, the measures that Roma- framework of the field we activate in some events or temporarily suspend nia has taken as a result of the Colectiv now. We will try to impose new stantheir activity because of safety reasons. tragedy are much more stringent than dards in the Romanian music producGoblin, Finnish, Revenge, Bastards, S- those imposed in countries with a long tion industry so that tragedies like the club, No.5, Fire, El Comandante, El Co- tradition in organizing and producing Colectiv one, do not happen again,” mandante Junior, La Historia, Blue live events. He warns that there will be concludes Davidescu.

Club, Kulturhaus and Hangover have a social impact of this situation as the temporarily suspended their activity deadline for obtaining an authorization anda.sebesi@business-review.ro

www.business-review.eu Business Review | November 2015

COVER STORY 19

Colectiv comment: can a safer capital be the legacy?

In the latest of Business Review’s series of articles considering events in Bucharest and Romania from an outsider’s perspective, Expat Eye reflects on last month’s devastating fire at the Colectiv nightclub, and wonders if improvements to the city’s social scene and culture could become a fitting tribute to the victims.

Photo: Mihai Constantineanu

∫ DEBBIE STOWE While the world prays for Paris, Romania is still grieving for those lost at Colectiv. Aside from new horror at the terrorist atrocity in France, the fresh reports of music fans dying at a concert are a poignant reminder of Bucharest’s own tragedy. It may no longer be prominent in the international media, but at home the catastrophe still plays out, in homes and hospitals.

It’s now some three weeks since the horrendous fire at the Goodbye to Gravity album launch, and the death toll has continued to rise ever since.

Heart-breaking stories keep emerging.

A young man who died on his 19th birthday. A cleaner – mother to five children – who took on an extra shift for RON 100 and never made it home.

A victim being transported to a facility in Switzerland – and the hope of better treatment – going into cardiac arrest en route, the plane returning to Romania.

Victims successfully making it to the UK – only to die a day or two afterwards. A singer waking up to the loss of all four of his band mates and his girlfriend.

The senseless suffering of the Colectiv blaze is endlessly shocking and sad, with the drip-drip of further deaths adding to the anguish. And yet the shock should perhaps not be that such a catastrophe happened last month, but that it didn’t happen before.

Most young expats coming to Romania from Western countries – used to stricter health and safety regimes

governing public spaces – have been surprised upon arrival at the obvious dangers posed by the venues that host the capital’s vibrant nightlife.

Nightclubs crammed with revelers, crumbling old town buildings in an earthquake zone, basement dive bars accessible via one narrow entrance and staircase, the lack of emergency exits and fire extinguishers, the prevalence of smoking – it all adds up to an accident waiting to happen.

At first you feel slightly uneasy. You might even joke over the music to a friend, “I hope there isn’t a fire in here…” But like many of the small, everyday infractions of Romania – parking badly here, paying a backhander or avoiding a bit of tax there – it is soon normalized. You stay at the club that night, and everything is fine. You go again; it’s still fine. The fears fade and the conditions become routine.

You no longer see the danger.

For all the overcrowded bars and lack of exits and extinguishers, there is not going to be a fire. Until, one day, there is.

The public’s desire for justice was passionate and painful. Once again, the people of Bucharest were marching through the capital and other cities demanding resignations and an end to corruption. This time last year, it was about electoral fraud and voters being denied their rights. Now, it was about the individuals who had allowed a public club to operate so recklessly, and bringing down the prime minister on whose watch the calamity had occurred.

While accusations of plagiarism, election rigging and being an under-

cover spy did not topple Victor Ponta, the Colectiv fire – described as Romania’s worst tragedy since the fall of communism – did.

Along with the PM and his government, the protests that followed the disaster – which brought tens of thousands of Romanians onto the streets – claimed Cristian Popescu Piedone, the mayor of district 4, responsible for licensing the nightclub. The owners of Colectiv were also arrested.

No punishment could be enough to atone for the near 60 young lives lost so violently, awfully and needlessly.

But at the same time, the culpable officials and club owners are only accused of doing what many others have done in Bucharest (and beyond). Coming to an “arrangement” to get around the rules, doing a shoddy job to save cash – this happens every day.

In that sense, they were “unlucky” – though the word seems horribly inappropriate in the context – that in their case things turned out as they did.

The days that followed the fire brought various mea culpas from other club owners, admitting to having also put lives at risk in their premises and vowing to improve or closing the venues.

They also brought a barrage of callousness and ignorance from the more reactionary reaches of society. While families and friends anxiously sought news of missing loved ones, waited at the bedsides of the injured or grieved the fallen, the superstitious and religious denouncers weighed in. The fire was a divine judgment against rockers and “Satanists” celebrating Halloween.

It is difficult to imagine how anyone could conclude that the young people who lost their lives in such dreadful circumstances – having merely gone out on a Friday night to have fun with friends and listen to music – earned their fate. The Orthodox Church received public opprobrium for the perceived lack of humanity of its response, and the “We want hospitals, not churches” slogan was revived, circulating widely on social media.

While the circumstances of the fire and its aftermath embody the worst of Romania – the corrupt, corner-cutting culture and the power of absurd dogma – the public reaction also showcased its best. As well as marching and laying flowers and candles at the scene, people queued to give blood, donated

cash to families, brought coffee and snacks to donors and medical staff tending to the wounded, and provided their company’s services pro bono to help victims and relatives.

There have even been moves to finally ban smoking in bars and restaurants, limiting both fire hazard and damage to public health more generally. Amid the unrelenting horror and bleakness of this story, this step towards a safer music scene and city might be a small but fitting legacy to the victims.

While the demonstrations were initially about individuals, they also became something bigger and more symbolic: a public movement to end the corruption and shoddiness that permitted the conditions for the Colectiv fire.

Last year’s marches were for a president who promised a “Romania of things done properly”. If the things done properly now come to include health and safety provisions at public venues, the use of the correct materials to make buildings safe, a licensing system with integrity, the enforcement of rules and regulations, and, most of all, a respect for the safety of others, the Colectiv victims will have a legacy of value. debbie.stowe@business-review.ro

About the author: Debbie Stowe is the author of around twenty books, including Romania - Culture Smart, a guide to local customs and culture, and Romania, from Thomas Cook's Travellers series.

Her journalism covers travel, film, dining out, business, economics and human rights. She has lived in Bucharest since 2002 and has worked for Business Review since 2003.

www.business-review.eu Business Review | November 2015

20

Focus on Technology and Telecoms: Businesses need to follow consumers online, say experts By 2020, there will be 50 billion connected devices worldwide, which is giving a big boost to the Internet of Things industry, and especially to its machine-to-machine component, argued the participants at the Business Review annual event Focus on Technology and Telecoms. The fact that consumers are shifting more towards online is changing the strategy of businesses which need to come up with new online solutions to target their public.

All photos: Mihai Constantineanu

From left to right: Alexandru Molodoi, CTO, Idea City; Violeta Luca, marketing & operations director, Microsoft Romania; Florin Popa, business to business director, Orange Romania; Tiberiu Dobre, director high corporate sales, enterprise business unit Vodafone Romania; Razvan Ionescu, marketing director – business segment, Telekom Romania; Vlassis Papapanagis, operations director, Predicta

∫ OTIlIA HARAgA “We are in the first phase of the 4.0 industry (Internet of Things.) In Romania, there are currently 730,000 SIMs on the market estimated for the end of 2015,” said Tiberiu Dobre, director high corporate sales, enterprise business unit at Vodafone Romania.

People are now living very interesting times when they are generating unprecedented amounts of data. By 2020, there will be 50 billion devices connected, which means 5 connected devices per user. However, out of these 50 billion devices, most will work without the help, or even knowledge, of users, according to the pundits present at the event.

This year, 30 percent of all internet traffic will be mobile, compared to 15 percent in 2013. This involves new ways of working together and the fact that social networks are entering the company sphere, according to Florin Popa, business to business director at Orange Romania.

Everything is moving offline and

businesses need to adjust this new strategy to consumers’ needs, according to Emilia Branzan, industry manager at Google. According to Google data, from 2010 to 2014, there has been a 53 percent decrease in foot traffic. Yesterday’s reality was that everything was anchored around the physical store and foot-traffic directed business decisions. Today, businesses need to adjust to a new reality, which is the fact that the digital drives instore traffic.

According to Google data, Romanians spend a great deal of time online.

Thus, 73 percent of Romanian consumers are online at least once a day, 20 percent of them go online weekly and 7 percent go online once a month or less.

Consumers who are online often are especially those aged 34 years old and younger. Actually, the time spent online increases as the age decreases.

Thus, 86 percent of young people under 25 go online every day. For the category 25-34 years old, 82 percent go online every day, while in the 35-44 age category, only 69 percent of them

go online. Only 64 percent of the people between 45-54 years old go online every day, while in the case of those over 55 years old, this ratio drops to 58 percent, according to Branzan.

Furthermore, many Romanian consumers are online even while watching TV. Actually, as many as 50 percent of them have their smartphones with them while they are watching TV. In fact, according to Google’s Consumer Survey U.S. 2015, 66 percent of smartphone users turn to their phones to look for something they saw on TV. While 76 percent of customers do online research, 29 percent purchase online and 47 percent purchase offline.

Search engines are essential in the purchase decision because they are used by 65 percent of users before making a purchase. Also, when it comes to a local business, 62 percent search a day or less before visiting and 75 percent only consider 1-3 businesses before deciding where to buy, according to Branzan.

The video channel is becoming more and more important in the pref-

erence of consumers, as 7 out of 10 consumers are watching videos on their smartphones. For 52 percent of them, watching videos is an opportunity to relax. Most people watch videos in the afternoon and the evening, and 37 percent of them watch videos that are shorter than 5 minutes.

Having a functional website adapted for mobile viewing is something that businesses will not be able to do without. When people are accessing websites via their smartphone, 53 percent of them are experiencing issues, and in this case, 32 percent go to another website that works better on their mobile, according to Branzan.

At the same time, with moving their operations offline, businesses also need to make sure that they are protected against cyber-attacks. Dorin Pena, general manager, Cisco Romania, said there is a multi-billion USD global industry that is targeting the businesses’ prized assets. “Romania is not a point of attraction from the point of view of the seized assets or data, it is a point of attraction because of the

www.business-review.eu Business Review | November 2015

potential it has to launch these attacks,” said Pena.

While businesses are shifting towards the digital, the Romanian public administration will also need to make a few steps in this direction.

Speakers at the BR Focus on Technology and Telecoms debated the fact that Romania still does not have a digital economic map. “Romania is unfortunately rather deficient when it comes to the access to public data. In other countries, such as the United Kingdom or France, there are independent organizations that are offering free access to sales in a certain industry. I believe the answer lies with the Romanian authorities. I think there is a lack of preoccupation in this respect in the public sector,” according to Popa.

Alexandru Molodoi, CTO Idea City, moderator of the first panel of discussions, said a digital economic map of Romania would be very beneficial because it “would bring some transparency in a field where there is little.”

At the level of Bucharest, there are several smart city pilot projects, according to Razvan Ionescu, marketing director – Business Segment, Telekom Romania. “We are one of the few operators in Romania with a high interest in smart cities solutions such as smart Wi-Fi or smart lighting. We already have several pilot projects with the Romanian authorities. This partnership is for Bucharest only, at the

21 level of one Bucharest district. We are currently discussing implementation opportunities with technological partners,” said Ionescu. otilia.haraga@business-review.ro

In which industries are consumers researching online l Flight tickets 96 percent l Hotel stays 96 percent l Cinema tickets 93 percent l Ground travels 93 percent l Televisions 92 percent l Music 91 percent l Laptops 89 percent l Mobile phones 88 percent l Home appliances 87 percent l Real estate 84 percent l Personal loans 82 percent l Car insurances 81 percent l Do-it-yourself 77 percent l Home furnishings 75 percent l Makeup 68 percent l Hair care 66 percent l Restaurants 58 percent l Clothing & footwear l Vitamins & OTC remedies 52

percent l Groceries 45 percent

Source: The Connected Consumer Survey 2015

From left to right: Bogdan Rusu, business relationships manager, ANIS; Dorin Pena, general manager, Cisco Romania; Cristiana Fernbach, coordinator IP & technology practice, Noerr; Marius Filipas, cloud and enterprise business group lead, Microsoft Romania

From left to right: Valentin Radu, CEO, Marketizator; Emilia Branzan, industry manager, Google; Mihai Tataru, managing partner, Senior Group; Remus Visan, managing director, Paravion / Bavul.com; Stefan Iarca, country head, Possible; Robert Berza, country manager, Zoot

www.business-review.eu Business Review | November 2015

22 TElECOM

Orange Romania: one step closer to completing national network overhaul project Orange Romania is on the verge of completing a major network upgrade project across Romania, which will provide improved coverage and better service quality. Stefan Slavnicu, chief technology officer, tells BR that, while coverage of “white areas” with mobile internet is a point on his agenda, it requires technical teams come up with innovative solutions to meet geographical challenges. ∫ OTIlIA HARAGA

CV

As CTO of Orange Romania, what would you say are the toughest challenges in managing and developing the network?

The main challenge is to assure the perfect “recipe” and the “right weight of each ingredient” in order to offer what we like to call “an unmatched customer experience.” Network quality and any related customer experience is a sum of many distinct factors such as expansion and improvement of coverage, network resilience, continuous optimization of existing services, development of new software and tools capable of offering real time information for any issue that may appear and fast answers to our customers’ requests or complaints, to name only a few. Finding the right balance between operational efforts, financial investment and customer needs is our daily challenge. Looking at how we are perceived by our customers, validated by benchmarks such as the results published by ANCOM following real-life tests customers have run using the Netograf app, I can definitely say that we are on the right path.

What are your 3-month and 6-month targets in terms of network development and modernization at Orange?

Short-term, our main targets are to finalize the launch of the new service we have recently announced, Wi-Fi call, and to prepare the network for the winter holiday period.

Medium-term, we will finalize a major network development and optimization project we are currently running throughout the entire country, aimed at providing improved coverage and better quality of our services. We are now working on the final areas, like Timis, Dambovita, Alba, Caras-Severin, Constanta, Prahova, Brasov, Covasna and Valcea counties.

What is the full year investment budget that Orange has allocated for the development of the 3G and 4G network?

Through our new strategy, Essentials 2020, Orange Romania is confirming next years’ investments aimed at developing the networks and services we offer our customers.

Stefan Slavnicu Has been working for the past 15 years at Orange February 2014 - appointed Chief Technology Officer of Orange Romania 2011- appointed head of Infrastructure Expansion at Orange Romania 2000 - 2011 he held the Network Expert and then Core Network Manager positions Has an EMBA from the Maastricht School of Management in the Netherlands Has a PhD in telecommunications from the Politehnica University in Bucharest sites’ autonomy is enhanced by adding additional batteries that support the service from hours to days, depending on the case and optical fiber cables are connected in a ring topology thus allowing for backup routes).

Overall, we are speaking about an amount that is larger than EUR 500 million for the timeframe 2015-2018, an important part being dedicated to 3G and 4G networks. We are working with all main telecom suppliers.

were significant, similar to the rural area modernization that was performed few years ago.

How much do network development and modernization investments represent out of the entire Orange annual budget?

The majority of our yearly budget is dedicated to innovation, development and modernization of our networks.

How much did data traffic capacity increase in the Orange network over the past years?

Mobile data traffic is following an explosive trend, increasing by over 100 percent each year. Large scale adoption of smartphones, 3G national coverage, 4G fast network expansion, are all contributing to this evolution.

Orange just ended a network overhaul project in urban areas (Urban Refresh).

How much did that modernization cost and what does it actually mean?

Modernization consists in a full swap of older equipment with new technologies that are more efficient (full IP, higher capacities) and environmentally friendly (less space, less consumption.) The entire urban network chain (antennas, radio equipment, transmission links, and high capacity routers) was changed in less than 2 years. The investments

The mobile networks of telecom operators sometimes meet difficulties. From your own experience, what have been the most frequent network failure reasons in Orange Romania’s case?

The most frequent incidents are related to electrical power supply network outages (mainly due to bad weather) or to the accidental cutting of optical fiber cables. It’s to be noted that the majority of such incidents do not affect the service offered our customers due to resiliency measures that we have performed (the

Is Orange part of the national strategy to cover white areas without internet with mobile broadband? Are you working on such a project right now, in which you are taking the company network to areas without internet?

Yes, we are working to cover an important number of “white areas”. This program is part of the strategy defined by ANCOM at the moment of the spectrum auction in 2012. Coverage of the white areas is in progress. Due to certain constraints related to the geographical position of most of the listed locations however, technical teams face challenges and are required to seek new, innovative solutions. We are making every effort to meet the deadline for all white area objectives.

At the moment, what are the capabilities of the 4G networks of Orange Romania, in terms of download and upload speeds?

For 4G, we have implemented 4G+ (carrier aggregation) offering up to 300 Mbps download and 75 Mbps upload. otilia.haraga@business-review.ro

www.business-review.eu Business Review | November 2015

RESEARCH & DEVElOPMENT 23

Romanian R&D inches forward at snail pace Romania spent RON 2.5 billion on research and development last year, representing 0.38 percent of the country’s GDP, with 0.22 of the money going to the public sector and 0.16 percent to the private one. The R&D headcount has only slightly increased to a total of 42,963 people, according to data from the National Institute of Statistics (INS.) The road ahead is long and challenging, as a 2014 EC report ranks Romania as a “modest innovator.” ∫ OTIlIA HARAGA In 2014, expenditure on applied research took a 44 percent slice of the total R&D expenses, slightly increasing by 3.5 percent compared to 2013.

On the other hand, expenditure on fundamental research dropped by 4.5 percent, from the 39.8 percent level of the previous year.

Expenditure on experimental development increased by just 1 percent from one year to the next, from 19.7 percent in 2013 to 20.7 percent in 2014.

The EC’s 2014 report Research and Innovation Performance in Romania ranked the country as a “modest innovator” with “one of the lowest values in the EU for both R&D intensity and business R&D investments.”

“To complete the picture of poor innovation, the Global Competitiveness Report 2013-14 still classifies the country as efficiency-driven (together with Bulgaria) while the rest of the EU economies are either in transition to, or are already at the innovation-driven stage,” according to the report.

In this context, the report concluded

2014 R&D current expenditure (RON 2.2 billion) l 54.9 percent- personnel ex-

penses l 12.6 percent- material expenses l 32.5 percent- other expenses

Source: INS

2014 R&D capital expenditure (RON 327 million) l 62.4 percent- equipment l 19.1 percent- land and construc-

tions l 15.5 percent- software acquisi-

tions l 3 percent- other expenses

Source: INS

Left behind: the low level of competitiveness is a key challenge for Romania

that “the key challenge for Romania re- to higher education units. The report mains its low level of competitiveness, also notes that the public R&D system is which has significant consequences for fragmented, with “a large number of rethe research and innovation system. search performers but a lack of critical The high-tech and medium-tech sec- mass of research results.” tors of the economy do not contribute Moreover, Romanian universities are lasufficiently to the trade balance, de- beled in the report as “underperforming mand for knowledge remains weak, in all major international rankings and and the innovation culture continues to their scientific production and staff be underdeveloped,” according to EC’s composition are less internationalized compared to other member states.”

2014 report.

The report also notes that a new National Strategy for Research and Inno- The news is not encouraging vation for the period 2014-2020 was in the private sector either developed by Romanian authorities, “The Romanian R&I (ed. note: research & which shoots for a gradual rebalance of innovation) system is primarily public research to innovation through a strong based, with only 29 percent of research component of smart specialization, and performed by the business sector, while includes a well-developed monitoring the EU average is 63 percent,” according system and multi-annual budgetary to the EC report. (…) “It is obvious that planning. the Romanian business sector’s interest According to the same source, the in developing their own R&I activities is strategy also includes measures that low, which is illustrated by the very low strongly support the development of numbers of PCT patent applications and R&D activities in the private sector. researchers employed by business enLast year, 48.6 percent of the financing terprises, and a very low level of busifor R&D projects came from public ness R&D intensity, which is continuing funds and 32.9 percent from enterprises, to fall,” notes the report. according to the INS data.

The financing for R&D activities Most of the public funds (represent- abroad has been evolving differently, ing 66 percent) went to units in the gov- going mostly to businesses, according ernmental sector, and 17.3 percent went to INS data. Thus, 52.6 percent went to-

wards businesses, while the higher education sector received 26 percent and the governmental sector received 20.9 percent, according to the INS. The intensity of research (calculated as a report between total R&D expenses and the gross domestic product) remained in 2014 at the same level of 0.38 percent, according to INS data.

“Over the last decade, R&D intensity in Romania increased from 0.37 percent in 2000 to 0.58 percent in 2008, only to drop back to 0.49 percent in 2012. Romania currently has the second lowest R&D intensity in the EU, at less than one quarter of its 2 percent target for 2020,” notes the EC’s 2014 report Research and Innovation Performance in Romania.

At the end of last year, there were 42,963 employees working in R&D, of whom 46.3 percent were women. The number of people with PhD and post PhD studies who worked in R&D totaled 16,983, having increased by 1,006 compared to 2013. Out of these, 45.9 percent were women, totaling 7,788, according to INS. Most of the R&D employees are researchers (64.1 percent of the total), representing 27,535 employees, which is 65 less people compared to 2013. Technicians and assimilated workers represented 12.4 percent, respectively 5,309 employees, according to the INS data.

According to EU’s strategic Horizon 2020 R&D program, there will be nearly EUR 80 billion funding available for the timeframe 2014- 2020 across the old continent, in addition to the private investment that this money will attract.

“The public-private collaboration shows promising bottom-up initiatives for developing clusters in economic sectors (automotive, IT) and research fields (life sciences, nuclear physics.) These clusters gather around researchers, businesses and policy-makers and are increasingly able to attract funding from European and national sources,” the report notes.

The EC report also recommends the Romanian government to design “welltargeted, top-down measures for supporting further development of these clusters, since they are a concrete solution for improving public-private collaboration in the R&D field.” otilia.haraga@business-review.ro

www.business-review.eu Business Review | November 2015

24 RETAIl

Black Friday shopping spree boosts retailers’ profits in Romania Black Friday, already a tradition over the past years in Romania, is something that Romanian IT&C retailers have started to prepare for long in advance, given that sales can even be ten times higher than on a regular day, according to some pundits. This poses substantial logistic challenges, but the retailers interviewed by BR say they are able to rise up to meet these challenges. pared to a regular timeframe, but we are 100 percent ready to deliver all the orders in time and safely. DPD has been preparing for Black Friday ever since September, talking to customers, estimating the volumes and increasing the work capacity accordingly. For this timeframe, we have increased and diversified the car fleet and the number of couriers by more than 30 percent.

We have doubled the surface of warehouses in the country, and we have also supplemented the capacity of the warehouses in Bucharest,” representatives of DPD Romania tell BR.

Romanians are buying more than in previous years

Next level: this year on Black Friday most shopping lists will include on average 2 or 3 products

∫ OTIlIA HARAGA On peak sales days like Black Friday, the number of orders received by online retailers can increase tenfold compared to sales during a regular month, which is reflected in the loading degree at operational level. These can spike even by 1,000 percent for stores without automatic software, according to pundits from e-commerce platform, Teamshare.

Retailers that have not automated and synchronized their “kitchen” to the high order rate, preferring to process and bill everything manually, face the highest issues, according to Teamshare experts. They say that, while these stores feel an operational surcharge up to 1,000 times higher, process automation can decrease the load charge to just 100-200 percent compared to a normal situation.

In fact, taking into account the low margin of the sales, taken down due to promotional prices, the Black Friday discount campaigns that run without automated processes, in reality, generate financial losses at a time when the entire online retail sector should make a profit, they say.

“In the case of the stores that work

without operational automations, they have many orders and returns that need to be processed within only several days with the same human resources. To this time crunch, when we also add the low margin of sales because of the promotional prices, the Black Friday discount campaigns that take place without automation cannot produce any profit so the outcome is quite the contrary,” according to Marius Panait, managing partner Entelion Software.

The ideal situation would be that the only thing left to a human operator at peak sale times is to transfer the order on the bill, while the rest of the processes are automatic, recommend the Teamshare experts. ”Buyers do not have time to call the call-center in order to check the accuracy of the information, because they are watching the best offers. The negative effects appear over the next few days when deliveries do not take place during the promised timeframe.

Process automation can actually prevent these situations,” according to Panait.

The retailers’ operating systems are not the only ones that can suffer glitches along the way. When the client places an online order via card, it is up

to companies like PayU to process them.

PayU Romania expects November 20th, which was declared Black Friday by most of its partner retailers, will see a double number of orders compared to 2014. “We estimate that the stores in the PayU portfolio that are organizing Black Friday will exceed RON 450 million in sales. Out of the total orders, we estimate that 25 percent will be paid using a bank card," according to Marius Costin, CEO PayU Romania.

Costin says that, from a technical viewpoint, the PayU platform is prepared to support seven times more transactions than those during Black Friday 2014. “We don’t expect to come across problems on Friday. Every year we invest hundreds of thousands of EUR in the expansion of the tech infrastructure, both hardware and software, in order to prepare not only for Black Friday, but also to support our customers’ expansion,” said Costin. Last year on Black Friday, there were over 10,000 transactions per hour at peak hours, according to PayU data.

Delivery companies are also facing very urgent challenges on Black Friday, given the high number of orders that need to reach the customers’ homes.

“Black Friday volumes increase every year by up to 60 percent, com-

This year on Black Friday, most shopping lists will include on average 2 or 3 products, which is more than in 2014.

On this list, the most frequently sought-after items are TV sets, desired by 40 percent of respondents, small home appliances such as vacuum cleaners, kitchen robots or mixers that are a priority for 39 percent of respondents and mobile phones, which are on the list for 22 percent of respondents in a survey carried out by MillwardBrown Romania on 2,000 respondents from urban and rural areas, aged between 18 and 65 years old. Washing machines and fridges are the next two categories of products ruling in the preferences of 18 percent and 17 percent, respectively, of those who were interviewed.

In fact, according to the survey, 44 percent of Romanians between 18-65 answered “I will probably buy some-

Top 10 online and offline stores considered by consumers l eMAG 30 percent l Altex 21 percent l Flanco 9 percent l Carrefour 8 percent l Kaufland 4 percent l Media Galaxy 3 percent l Auchan 3 percent l Domo 3 percent l Lidl 2 percent l Cora 1 percent

www.business-review.eu Business Review | November 2015

thing” or “I will definitely buy something” on Black Friday, when questioned as part of this survey. The category that displays the highest purchase intention is that of young men, aged between 24 and 24 years old, according to the survey.

Compared to 2012, when the Black Friday phenomenon was still green, nearly three times more people said they would buy something this year.

Also, the number of Romanians who have heard about the Black Friday discounts has reached 71 percent.

Recently, some Romanian retailers have been under fire from the media, under suspicion of raising prices in the weeks before the Black Friday campaign.

Dragoș Sirbu, CEO Flanco Retail, told BR that this is due to the report between the benchmark price and the discounts applied for that product at various times. “Always before Black Friday, there are controversies and discussions, especially because of some technical specifics of the retail industry.

In retail, there is something called benchmark price, in other countries it is called ‘manufacturer recommended sales price.’ This is the “whole price.”

Each promotion campaign that posts percentage discounts is reported to that price. In case of temporary campaigns, after they are over, the price goes back to the initial level. The discounts announced on Black Friday are also reported to the benchmark price, the difference being that, in the case of many products, they are considered higher than during some discount campaigns. (..) I think there should be a clearer and more frequent communication of these benchmark prices, so that this confusion goes away, the discount is clearer for consumers and the honesty of retailers is not questioned,” he told BR.

Retailers adopt different business models Total Black Friday sales across the entire Romanian retail market will reach RON 1 billion, Iulian Stanciu, CEO of online retailer eMAG, told the media in a dedicated Black Friday conference. eMAG, which spearheaded the Black Friday phenomenon several years ago, chose November 20th as Black Friday, so that customers have the time to receive their products before December 1st. The company expects to sell around 650,000 products worth RON 200 million, and promises that the products will be delivered between November 21 and 29.

According to Hotnews.ro, the company admitted to some difficulties during last year’s Black Friday when delivery of 10 percent of the ordered products took more than six days, and some customers even received the products after a month.

Another well-known online retailer, PC Garage, estimates orders of RON 12 million, which would be a 30 percent growth compared to last year’s edition.

“The same as last year, we will roll out

RETAIl 25 Top 10 most popular purchased products TV sets Small home appliances Mobile phones Washing machines Refrigerators laptops Clothes Cooking machines Tablets Footwear

the Black Friday campaign throughout the entire November 20-22 weekend.

Right after Black Friday, on Monday, November 23rd, PC Garage is organizing Cyber Monday, being the only store which brought this concept to Romania,” according to Razvan Pop, marketing director PC Garage.

This year, PC Garage aims to deliver 80 percent of the orders in at most 4 days since they are placed, added Pop. Thus, PC Garage will be working with the same two delivery companies it usually works with. The customers in Bucharest will receive their products starting November 20th and the customers in the rest of the country, starting the next day.

MarketOnline.ro started preparations for Black Friday this summer.

“Given that many other stores started the Black Friday campaigns on November 1st, this year we wish to grow by 20 percent the level of sales of RON 8 million that we reached last year,” said Andrei Cracea, manager MarketOnline.ro.

The products should be delivered within 3 days by the three delivery companies that MarketOnline.ro is working with.

CIT Group, a company that sells refurbished IT&C products, is in full swing of the discount season. “This year we decided to adopt a progressive system in which we kicked off the discount season on the first Friday of the month and increased the discounts progressively for the products in stock.

We have a limited range of products to which we apply minimum discounts of 17 percent. The climax for the price of the products that are still in stock will be the last Friday of the month, November 27th. (…) We are mainly relying on refurbished computers and laptops, for which we offer 5 years of warranty and a Windows license,” said CIT group representatives.

Retailers with a strong offline sales component are also preparing for Black Friday. Flanco Retail will organize Black Friday between November 20-22.

“We don’t think it is sustainable or possible to offer significant and authentic discounts for longer periods, and we do not want this concept to lose its value,” said Sirbu.

The retailer posted last year total sales of RON 98 million on Black Friday, with customers buying over 200,000 products. “This year, we wish to exceed the 2014 performance. (…) To be conservative, we aim to deliver all the

2014 30 percent 36 percent 20 percent 9 percent 11 percent 15 percent 17 percent 6 percent 12 percent 8 percent

orders within a week,” said Sirbu.

Its competitor retailer, Media Galaxy, that runs the Media Galaxy and Altex stores, said it will organize “the biggest Black Friday ever” between October 30th and November 30th, estimating EUR 75 million sales for Altex and Media Galaxy stores.

“Customers will benefit from substantial discounts for 32 days, which is translated through discounts for various products and larger stocks than what they are used to. (…) The discounts are split per week rounds so that buyers can enjoy new discounts every week,” says Carmen Capitanescu, marketing manager at Media Galaxy.

“We are working with a delivery company and with our own fleet. We will be trying to deliver all orders within 24 hours,” said Mihnea Nicolescu, e-commerce manager at Media Galaxy.

F64, a retailer that focuses on the

2015

2014 vs. 2015

40 percent 39 percent 22 percent 18 percent 17 percent 15 percent 15 percent 11 percent 8 percent 6 percent

+ 10 percent + 3 percent + 1 percent + 8 percent + 6 percent 0 percent -2 percent + 6 percent -4 percent -2 percent

photo and video product niche, has seen improvement in the Black Friday sales yearly. “From one year to the next, our Black Friday campaign went better and better. In 2014, we reached sales of RON 13 million, and for 2015 we forecast a 20 percent hike for the three discount days,” Marian Alecsiu, founder of F64 photo store told BR. The appetite for Black Friday is not expected to shrink, neither for retailers who see it as a perfect opportunity to boost sales, nor for consumers who are hunting the best quality-price ratio.

“This is the fourth Black Friday edition and, with each new edition, more and more stores are announcing their participation. I don’t think we have reached a saturation point, which is why this year there are more stores who have prepared such campaigns,” says Alecsiu. otilia.haraga@business-review.ro

www.business-review.eu Business Review | November 2015

26 DIGITAl

Azimo launches money transfer service in Romania Digital money transfer service Azimo, based in London, announced in November the launch of its reach to Romania and the Republic of Moldova, with a 30-minute cash pick-up service in close to 600 locations including Idea Bank and BCR Smith & Smith branches in Romania and Victoria Bank branches in Moldova. Michael Kent, CEO and founder of Azimo, which in May raised USD 20 million in financing, tells BR about Azimo’s plans in Romania, a market with at least 3 million migrants.

They said that overall, the market could be USD 1 trillion a year. Europe is about USD 150 billion a year, of which Romania is USD 4 billion. Our main competitors are Western Union and MoneyGram.

∫ OTIlIA HARAGA

In May, you received USD 20mln financing. How did you invest that money ?

We have been quite conservative in spending that money, but our main business target is to market the service.

We do our marketing in two ways: we do digital marketing, increasingly targeting people on their phones, so it won’t surprise you to know that we do marketing with Google, and also with Facebook, because a lot of our migrant populations, particularly Romanians, love hanging out on Facebook. On the other hand, we have quite a lot of stuff that happens offline, because we have lots of Romanians working for the company, going out talking to people about the business. So right now, over 50 percent of our customers come to Azimo through word of mouth. We spend money on marketing in 2 ways: first, with the traditional and local events, community marketing and digital. The other thing we spend money on is just building up a platform because, as a financial services business, we are regulated. So we built the whole system with 4-5 developers, we now have 25 people in our development team and they are constantly working to improve it. If you looked at Azimo two years ago, it worked, but it was a bit clunky and we are trying to streamline that experience.

Photo: Mihai Constantineanu

How did your entrepreneurial story lead you to setting up Azimo?

I worked in the money transfer industry nearly 10 years. Before I started Azimo, I set up a traditional money transfer business called Small World Financial Services and it became quite big, it was number 5 globally in money transfer. I sold that company and I kind of figured there had to be a better way. The way customers led their lives had changed a lot in those ten years.

So, together with my partner, we thought that if we were to start again with a blank piece of paper, how we would design a business to serve this customer need, which is to send money internationally very easily, quickly and cheaply. And that is how we came up with the idea of Azimo, three years ago.

How hard was it to find investors for your business?

Raising money into a business today is like walking up the stairs, you can’t jump all the way to the top. Initially, I funded the business myself, together with my business partner. We got some initial product and research done, we had a viable business proposition before we had to go out and raise money from investors. And then we took money from angels: Matt Cooper, one of the big founders of Capital One, a big bank in the US and David Yates, who used to run First Data. Talking to your readers, one of the first steps would be to get very credible early-stage guides. They might not give you millions but they will give you some money and you can borrow their reputation. There are quite a lot of people in Romania who have made a lot of money in financial services. If you can get those guys investing even at an early stage, it will give much more credibility with more institution investors. So after we raised money from angels, we took another round, this time of institutional money. It was very little actually, it was less than USD 1 million and that was our first institutional investor. It is very important to choose that person carefully to make sure they are fully committed to what you are doing and also that they know that things will change. Because when it is very early, if you give someone a very precise set of numbers, you know

that it’s never going to be those numbers. Things will be different from now.

And there are early-stage funds in Romania, there are also pan-European and financial services funds, so there are investors out there. But then, when you are trying to get in the fight for USD 10 million rounds, there are probably 20—30 people in Europe. That is unfortunate; it is hard for us because, even in London, we have a much less developed capital market than in America. I think still in Europe there are really good ideas that don’t get funded and really should. We do have an American investor, one of our investors is called Greycroft, it is a very well known East Coast hedge capital fund. The interesting thing about American investors is that quite often they want you to set up in America. For us it is not really the right thing to do because right now we are really focused on serving Europe.

How big is the money transfer market globally?

It’s USD 600 billion globally annually, according to World Bank estimates.

That only refers to the formal remittance market. If you take the informal market - which is people sending money on envelopes in buses - things are different. For instance, I don’t know if you heard of Hawala, the informal Islamic transfer through mosques.

So yes, there are a number of informal markets which could be equally big.

What are Azimo’s future targets on the Romanian market?

In a year, we would like to get to 1 percent market share in Romania. Romania has probably 3 million migrants, so that would be 30,000 customers sending about USD 40 million. It is very hard to estimate the market size, but if we can hit those numbers, we would be happy. Longer term, we have ambitions to be a big international company.

The average transaction is around EUR 400 and Romania is almost exactly on the average.

So what are the next steps?

There are a couple of things. First, looking at the options we have with wallet providers such as Orange, Vodafone, Telekom, all those guys. Also, increasing the number of locations. We are working with Smith&Smith, trying to identify the areas where we don’t have locations to make sure those are opened up. We are going to start doing quite a lot of local marketing activity.

The interesting thing about Romanians migrants is that they are exactly the same as Romanians, they listen to the radio and watch TV, so it’s exactly the same channels and brands. Therefore, we are trying to work out what is the best way to market to those people.

Are you interested in making other investments, maybe even in Romania?

Romania is very close to Europe, it has access to the EU market, which is fantastically interesting. The development talent is ten times better than in London, you have very talented technical guys and I think they are starting to see product managers and business development people coming through the ranks. Quite often, they are trained externally in Western Europe or the United States and now they are coming back with these new skills and are trying to build interesting businesses.

So yeah, I think it is really interesting. otilia.haraga@business-review.ro

www.business-review.eu Business Review | November 2015

28 TECHNOLOGY

Technology is the catalyst for change With annual investments in R&D projects reaching 10 percent of turnover and a consolidated turnover of EUR 93 million in 2014, Bogdan Padiu, CEO at Teamnet Group says the group aims to generate 40 percent of revenue from international markets by 2018 and to enforce their position as a regional player. technology is one of the most important pillars supporting the evolution of society, and we are confident that the years to come will only further integrate innovation into our lives.

If we look at forecasts, according to Gartner, by 2020, there will be a quarter billion connected vehicles on the road, enabling new in-vehicle services and automated driving capabilities. In this field, the future will provide the opportunity to buy a movie ticket as we're driving past the theater because the car knows that the theater is there and that we like going, and it will even suggest a movie we might want to see.

Also, starting 2018, cars will have an electronic safety system which will automatically call emergency services in case of a serious accident. Teamnet is part of HeERO (Harmonised eCall European pilot), a project which, among other objectives, is preparing the infrastructure required to achieve the “eCall” service interoperability at the European level.

By 2020, studies also show that a quarter of the organizations in emerging regions will run their core CRM systems in the cloud, up from around 10 percent in 2012. In five years, drones will be a standard part of operations in many industries, used in agriculture, geographical surveys, oil and gas pipeline inspections. Also, in the industrial market, robotic systems will replace the use of several robots in a common production line, offering companies the possibility to innovate the working process, thus streamlining the operations and necessary investments on this segment. And the list could go on and on. We constantly invest in key areas such as Robotics, GIS, Cloud and SCADA.

∫ ANDA SEBESI At present, technology is one of the fields with extremely rapid developments. How do you see the world from this perspective in the next five to ten years?

Technology inspires us to evolve and

brings innovation to all aspects of our lives. We depend on technology for everything we do; this is why technology is no longer a concept that refers exclusively to the IT sector, but a reality for all industries all over the world.

Today, technology is the backbone of numerous processes and day-to-day activities. At Teamnet, we believe that

Teamnet is actively involved in research and integration of Unmanned Aircraft Vehicles (UAV) technology.

What can you tell us about the projects of the Group in this field, the Signus and Hirrus UAVs respectively?

We currently integrate UAV systems offering accurate real-time data from the air, and we are actively involved in the research and development of new, improved functionalities, which will position our autonomous systems near the top-rated products in the field

in the next years.

Signus is an innovative UAV system that is currently in the prototype phase and is designed to reach high performance in terms of speed (230 km/h) and altitude (3.000 meters) and weighs up to 100 kg. Airbus Defense & Space is our supplier for developing the solution for the broadband data communications system and on-board computer for this unmanned aircraft.

Our expertise in the UAV technology has been proven so far also by the Hirrus system, already being used in several countries in the region and making a real difference through its extensive applicability in various industries such as agriculture, emergency sector, urban development, border surveillance and real estate.

The advanced integrated UAV system is able to cover large surfaces in the shortest time possible, capturing and streaming both daytime and nighttime high resolution live images from the ground, even in unfavorable weather conditions. Hirrus provides institutions such as Border Police, Coast Guards and Emergency Agencies at European level with highly effective advanced surveillance solutions. Together with EmerGIS, a complete emergency and disaster management software application which encompasses advanced GIS systems, Teamnet’s leading airborne technology is essential in emergency situations that might occur in the monitored areas, allowing immediate location and information detection and a fast, targeted intervention in case of disasters, with minimal costs.

As one of our best practices, this year, we have developed and implemented in Serbia an integrated UAV and GIS system for the management of natural disasters at the border between Romania and Serbia, as part of a complex cross-border cooperation project for safety in emergency situations. This way, residents from the border areas can benefit from enhanced safety, through the optimization of procedures and of the response time in case of flood, fire or other natural disasters. Thus, we are the first company in Romania to export UAVbased integrated solutions in the region.

www.business-review.eu Business Review | November 2015

TECHNOLOGY 29

Hirrus UAV

What are the research and development projects that Teamnet Group is developing now?

There are many important R&D initiatives to mention. Among them, a visionary project aimed at developing a next-generation complex and multifunctional industrial robotic assembly, which will revolutionize the production process in various fields such as aeronautics, railway and sea transportation, infrastructure engineering and renewable energy. The Megarob structure is available for trial use and, further on, will become available for deployment in today’s factories worldwide. The prototype was launched in October, this year, and was developed with the support of six other organizations from Spain, Luxembourg and Switzerland, coordinated by AITIIP Technology Centre.

NEXES or the Next Generation Emergency Services, an R&D project that we joined this year, stands out through its ambitious objective to deliver innovation to 112 services across Europe. Additionally, it will lead to the development of a truly universal emergency situation management system, through the research and development of advanced IP-based communication systems and technologies. NEXES enables the use of total conversation capabilities in emergencies, including social media, for the benefit of citizens. It allows the exploitation of improved location information to rapidly and effectively identify and locate the caller and the incident site and enhances interoperability and shared awareness among emergency services by leveraging internet-enabled connectivity. Within the project, Orange Romania will ensure the expertise and communication infrastructure based on which Teamnet will develop and integrate software services for the applications dedicated to the emergency services at national level.

By 2020, Gartner forecasts developed world life expectancy will increase by 0.5 years due to widespread adoption of wireless health-monitor-

ing technology. Through the StayActive European project, we aim to reduce health and work problems arising from stress for older end-users, while, at the same time, to support organizations by enabling users to adhere to corporate policies easier.

How do you invest annually in research and development and how much did you invest in this area so far?

Innovation is in Teamnet’s DNA. We constantly invest in research and development projects aimed at transforming innovative ideas into reality, with 10 percent of our turnover being dedicated to R&D projects every year.

We have been investing in R&D for over 10 years, as a long-term endeavor and a strong commitment.

What can you tell us about the presence of the Teamnet Group worldwide and what are its main plans in this regard?

Regional development is one of the key elements of Teamnet’s strategy and roadmap, building on the rapid evolution seen in the past years.

Teamnet’s regional expansion started in 2010 and, today, besides our headquarters in Romania, we are present with direct operations in Turkey, Belgium, Croatia, Serbia and the Republic of Moldova, while counting a total of 10 countries where we are actively developing projects alongside regional partners.

By 2018, we plan to enforce our position as a regional player and grow our business in international markets, with the business objective of generating 40 percent of revenue from this area. At the same time, we will continue to consolidate our regional growth strategy and expand in new international markets, such as Poland, Italy and Bulgaria, as well as reaching a higher coverage of the CEE and MENA regions.

What is your expertise at present?

What are the directions of innovation that the Group is following?

We are constantly investing in the development of our team’s key compe-

tencies. We are among the first companies in the region integrating the GIS technology with the UAV systems, in order to deliver full solutions or to design a Cloud platform accessible to the SMEs in Romania. Moreover, we are specialized in the design and implementation of the SCADA automatic control systems that are successfully integrated in our engineering projects.

In the past years, we have specialized in different innovation fields from Natural Language Processing, Big Data and Computer Vision to Robotics, Internet of Things and Ambient Assisted Living, and currently, we’re focusing on four main R&D directions: Robotics, Cloud, Internet of Things and Smart Cities. More than 30 projects testify our expertise in research and development.

What are Teamnet’s main achievements of the past three years and what is your business vision over the next five years?

In the last years, we managed to bring change in each company of the group, in the local IT&C industry and at regional level. Among our main achievements, we mention the strategic financial partnerships with renowned investors - International Finance Corporation, a World Bank Group Member and Black Sea Trade and Development Bank -, the strategic partnerships with NEC and Microsoft, opening new offices at international level, developing new innovative products, building on new business lines and consolidating our position as one of the top employers in Romania. Also, this year we joined the Elite programme, initiated

by London Stock Exchange Group, that develops and supports ambitious private companies from Europe through their growth process.

Today, we are planning to reach equally significant milestones in the coming years. One of them will be the listing at a Stock Exchange by 2020.

Also, our financial results confirm the growth potential, both in Romania and regionally, which is why our strategic plans for the next five years consist of

launching complex products and projects in important international markets, where we can develop large scale projects built on our business pillars: engineering, medical services, cloud, IT operations and robotics. Also, we will increase our focus on growth in the private sector, bringing innovation to the areas we are active in.

What do 14 years of presence on the Romanian market mean for Teamnet?

Over the past 14 years, our innovative initiatives and ambitious plans transformed us into one of the leading IT system integrators in the region. In 2014, Teamnet Group recorded a consolidated turnover of EUR 93 million, 29 percent higher compared to 2013.

Teamnet has been included in the Deloitte Technology Fast 50 Central Europe, ranking for seven years in a row and remained in the “Big 5” category in 2015. Moreover, the company recorded a strong evolution in terms of number of employees, from 7 people in 2001 to approximately 800 today.

How do you see Romania in 20 years from now from a technology perspective?

The future of technology is limitless.

The synergy between state-of-the-art technologies such as Cloud, Internet of Things, GIS or UAV will most certainly lead to technological innovation that will fuel Romania’s development in the next two decades. Research and development play a key role in this technological evolution where Intelligent Objects and, furthermore, Smart Cities, are only some of the new innovations Romania could experience in the future. With everything connected to the Internet, from TVs and smartphones to robots, home appliances or ATMs, to the city’s infrastructure that will not only be connected, but will dynamically adapt to changes in the enviroment, therefore we will witness new ways that technology can revolutionize and transform our day-to-day lives. anda.sebesi@business-review.ro

www.business-review.eu Business Review | November 2015

30 TECH SHOPPING

Audiophile? Jazz up your home!

Since 2007, AV Store is one of the leading names in audio-video residential devices. With sales expected to reach over EUR 3 million in 2015, this small business is a testament to the success of niche operations. Employing an online and offline business model, this business offers both the online convenience and a one-of-a-kind showroom, where sound lovers get to feel like home. To find out more about this niche, BR performed a sound check with Bogdan Stefan, managing partner at AV Store. ready been made, no worries, the devices we have can be easily integrated into the space, without the necessity of breaking walls or extra investment in construction, if is not the case.

The new showroom is perfectly designed for your audio and video experience

∫ TATIANA LAZAR What does a home cinema experience mean?

Home cinema covers a wide range of equipment, from projectors, where prices start from about EUR 500 up to EUR 17,000, to projection screens from Projecta with characteristics like 4k resolution (8 million pixels), tensioned projection surface, special granulation of the surface, not to mention the importance of the sound.

Of course, you can make your own home cinema with a TV-set, but when you see a movie on a 3-4 meter screen, there is no comparison. Furthermore, the experiences that a big screen offers are unimaginable – you are actually projected there in the movie or on the field. When it comes to sound, we are talking about two different things: the soundtrack of a movie and the sounds of it – the special effects. For these effects we have surround sound.

Also, we promote the Dolby Atmos technology, a 3D audio experience which is used in theaters, but now can be brought home, letting film makers place sound elements in a 3D space.

Basically, the sound engineers of the movies can place objects in the room to make the experience more realistic – for example, if in a movie there is an arrow which crosses from left-behind to the middle of the screen, the sound of the arrow’s movement will pass

near my left ear and this happens courtesy of the speakers placed in different locations of the room.

How is a hobby room made?

The hobby room concept is something that we promote and it means a special space in the home where the devices can be installed, from home

cinema equipment to karaoke or games. It really helps us to better understand every client’s need if we can see the house plans and if we know the construction’s composition.

These details can make the difference, especially when the client is willing to invest consistently in his/her hobby.

Also, if the design of the house has al-

AVStore in numbers: l 10% of the total national headset market is sold through AVStore l Best buying products: speakers and headsets l Over 1,000 pairs of speakers sold in 2014 l 20% of the business comes from the distribution network l Over EUR 3 million sales expected in 2015 l EUR 100,000 spent by one client for audio devices l RON 10.3 million turnover in 2014

How do clients find you?

Most of our clients first land on our webstore, looking for some device, and then they come to the showroom to actually see the product, test it and of course, to learn how to maximize the device’s options. What’s interesting is, that after their first contact with us, they keep close and return for better devices or even develop a passion for sound and want to learn more about what we have “in house.”

Also, we have three main categories: home cinema, music equipment and headsets, which make the buying decision complicated, especially because of the subcategories each has.

For example, when we talk about headsets, you should know what you want to use them for, because we have on ear, over ear, in ear, high-end, fashion & streetwear, wireless, sports, hands-free, TV, travel and many other types.

Who are your clients?

Our clients can be divided into two main categories: those passionate about the new technologies, sounds, screens, very well-informed, the audiophiles and those interested in quality and the special effects that a home cinema system can offer as an experience. When it comes to gender, men are interested in the technical qualities of the products, whereas women like design, although we have an important specialized womens’ community.

Which are the brands you exclusively bring to Romania?

When we talk about brands, we basically bring to Romania the most important and relevant brands which are promoted and known worldwide: German Sennheiser headsets, AudioTechnica headsets and turntables, German Audio Physic speakers, Mission speakers, Norwegian Hegel integrated amplifiers, Devialet integrated amplifiers and the best wireless speakers in the world, Fiio amplifiers for headsets and portable hi-res music players, and many others. editorial@business-review.ro

www.business-review.eu Business Review | November 2015

32 PR

How a nation learns a PR crisis-handling lesson 57 dead and over 140 injured. A toll of pain and suffering that seems to never end. A country reborn out of solidarity and desire for change has to learn the hard way that corruption and the lack of proper information destroy lives. But what was also learned is how to get up and start taking new steps, the right ones, in the right direction and with a higher purpose. BR spoke with some of the most appreciated PR specialists with expertise in crisis management in order to find out more about how they saw the situation and what lessons learned can be applied in the future.

Crenguta Rosu, DC Communication

that the situation is deliberately kept at this level. That’s why in my opinion, the real debates are happening now on Unfortunately, PR crisis management in Facebook, the new analysts are also on the administration and the public sector FB, the new aggregators are on FB. The was handled weakly, if not poorly, and real, genuine discourse is now in social all our respondents were in agreement media,” added Vintan.

Another Romanian expert in hanwith this statement. “There is a lack of capacity in the public administration dling PR crises, Ana-Maria Diceanu, generally and in communication even head of the crisis management divimore. There are very few governments sion/PR director at GMP PR, considers in recent history that have understood that nobody can dispute that the public the need to have powerful teams of sector needs to be more open to profescommunication experts. From civil ser- sional exchange insofar as communicavants to state secretaries and ministers, tion is concerned, and to consult the PR all are refusing to be guided and advised specialists from the private sector. “The

by PR experts. They lack the reflex of ministries, the clergy, the mayor’s office consultation and they trust only the have to understand that they need to people from their inner circles that are practice PR in accordance with the comnot necessarily experienced, especially munication rules of this century. Therein dealing with a crisis of this dimension,” fore, the best idea that comes to mind is said Corina Vintan, founder and manag- a think tank comprising of PR profesing director at Links Associates- Edel- sionals from the private sector, a think tank that would be governmentally creman Affiliate.

As became apparent in the media ated. Some institutions manage a diffilandscape, Romania has the type of cult situation better than others; some media that tends to “hijack” the mes- bury their heads in the sand and decide sage that should be delivered to people. that saying nothing is better. If they “We have talking heads, with vested have a sense of PR, it translates into agendas, moderated by people with everyday practice,” explained Anavested interests, no proper debate, sti- Maria Diceanu. For example, she apprefled discussions, the same “analysts “ ciates the way firefighters build up their everywhere. No doubt people realize reputation. “Every time they are con-

∫ ROMANITA OPREA

Bogdan Theodor Olteanu, Daescu Bortun Olteanu

fronted with a situation, they come in endowed with all the necessary gear, ready to act…What can speak louder for their ability to handle a crisis than this?

When one manages a crisis, it should not be only about writing a press release or making a statement, it can be also about showing what you are able to do, proving you can solve a problem. Unfortunately, talking seems to be sometimes the main sport, and not a winning one,” added the GMP PR representative.

A good handling of the situation requires “presenting the facts - as accurately as possible, answering all questions that appear - in an accessible manner so as to avoid misunderstanding, explaining the courses of action that are being taken and stating the next steps. In a nutshell, have common sense, decency and compassion, react quickly, be transparent and communicate continuously,” said Anca Rancea, freelance PR Consultant. And most of all, according to Bogdan Theodor Olteanu, partner of Daescu Bortun Olteanu, don’t forget that the crises end only when all the negative aspects are dealt with in a proper manner, and that is a process that can take months, or even years.

“Crises are tough situations - the thought process and many of the deci-

sion-making processes take place behind closed doors, based on arguments and data that may never become public, so it is very difficult to judge them from the outside. One thing is true for all of them: it is not the crisis itself that defines or damages those in charge of managing it, but the way they react to it and the way they communicate around it. The Colectiv tragedy highlighted the fact that hospitals and other institutions in the administration do not have teams of trained communicators. Much of the communication following the event was handled directly by doctors, firefighters, the actual crisis managers rather than trained communicators or spokespeople. This was neither practical nor reasonable – we were asking the same people both to fix the problem as quickly as possible and talk about it in great detail,” commented Sorana Savu, owner of Premium Communication.

In support of her opinion, she pinpointed the fact that all Romanians saw the handwritten lists of incoming patients – as one friend in the communication industry was telling her, several hospitals did not even have enough computers and office equipment and much of it was outdated. “We are working to fix this. Communication in hospitals and health facilities is a big deal in

www.business-review.eu Business Review | November 2015

PR 33

Sorana Savu, Premium Communication

the US for instance – specifically because hospitals deal with life and death situations daily. As we have seen, we too need to add a stronger communication function to our own medical institutions, not only in times of crisis, but also for the day to day activities,” recommended Sorana Savu.

Crisis communication: step by step A well-managed crisis has to respect some key action points: never deflect, dismiss or denounce in a crisis, the truth will save everybody and no matter what, you have to do the right thing.

“What do we have here? We have a Health Ministry accused of hiding the truth concerning the hospital’s capacity to treat the injured people from Colectiv.

We have a Ministry of Internal Affairs who got tangled in its own press releases instead of telling the truth regarding the behavior of its boss. We have a sector Mayor who refused to take responsibility and tell the truth from the first instance. The matrix of communication in a crisis should be thought around some core values: Care, Commitment, Consistency, Coherence and Clarity. In Colectiv’s specific case, we’ve seen a lot of care and commitment which is a big step forward, but we haven’t seen that much consistency, coherence and clarity and this is directly linked to the lack of procedures and organizational culture,” argued Corina Vintan.

Her opinion is shared by Crenguta Rosu, owner DC Communication, who believes that communication was practically absent after the burst of the tragedy. “We had the initial announcement and then the deployment of the victims and then silence. Then later, much too late - a message came out saying that everything is under control.

Things are bad, but under control.

There was no constant report regarding what is being done, what the status of the overall process is, what are the needs and how people could get involved. Most of the sources were indi-

Corina Vintan, Links Associates-Edelman Affiliate

viduals in contact with the hospitals.

The very little official announcements were not repeated enough and lost in the mass of data. This is why everything looked like a huge chaotic mass of information. This is why, regardless of what the authorities state post factum (no matter how true,) has/had little credibility,” said Crenguta Rosu.

Moreover, in her expert opinion, there was also a lack of logic in everything that happened. Anyone with a sick person in contact with the hospitals would have known that there is always a lack of materials in every hospital.

“The messages <<everything is right, we need nothing>> were not supported by previous experiences with the medical system and not explained (if new special resources were allocated, how much, for how long, etc.) In parallel, news was coming from hospitals from desperate friends and families of the victims from 11 different places, with the natural emotion embedded, that there are more things that need to be done in order to save loved ones. So we had lack of information, late information and non-coordination,” added DC Communication’s owner.

The same lack of coordination was seen also by Bogdan Theodor Olteanu.

“There wasn’t any kind of centralization and coherent flow of information. The public discourse, when available, was juvenile and contradicted by the facts,” said Olteanu.

Not only when viewed from a specialist’s eyes, but also just from common sense and understanding of every citizen, it was quite obvious from the very beginning (the first hours since the news broke) that there was little to no real interest in accurately sharing the information with the public. It was clear that there was no head of communication or any communication strategy during this crisis. These are the main reasons that false information and chaos were instilled in the Romanian reality of these tragic days. There was a constant refusal and beating around the bush instead of answering the valid

questions that arose. There was a lack of differentiation between the information communicated regarding the deceased and the wounded. It’s a situation from which all Romanian PR professionals should learn, but more importantly than that, from which the State’s representatives should learn.

“In the haze of making decisions, communicating to the public was neglected and, in my opinion, this excuse is only acceptable regarding the medical staff, all of whom were literally busy saving lives” pinpointed Anca Rancea, freelance PR Consultant.

Clear, timely and frequent communication is needed during crises. “You need to talk to all those affected, all those able and willing to help and all those that are curious. And you also need to allow time for the people who are in charge of the situation to manage it and limit the damage as much as possible. You need to quickly create a structure for the communication and establish credible outlets for the information. And you need to have someone in charge of communication. If you do not have official information in place, in time, you allow for speculation and gossip,” explained Sorana Savu.

Unfortunately, not everything was by the book in the aftermath of this tragedy. And, as previously shown also

by Corina Vintan, “probably the most important game changer was social media and particularly, Facebook. All the rumors, mixed with real and detailed information were there, everything was unfiltered. All the questions, the worries, the grief, the outrage, all the conversations that we were once held in private became, all of a sudden, public. Hesitations, delayed statements, inaccurate information were all picked up by everyone, interpreted, some blown out of proportions, others reduced to silence. This is why, to this day, there is still a lot of confusion about both the tragedy and the way it was handled,” declared Premium Communication’s owner.

“I see what Hotnews.ro has become,

what bloggers are doing. As we very well know, crises have two facets. One is the crisis itself and the other one is the opportunity that it creates. The positive outcome in this huge tragedy is that this crisis has produced a whole reset of the Romanian reality, from politics, to administration, business and population.

This window of opportunity will grow and will change the whole paradigm in Romania,” added Vintan.

“It is for the first time we have faced such a tragedy, which I dare to call the Romanian 9/11, and it would have placed any PR professional in a tight spot, be he/she Romanian or foreign. So I refuse to judge and analyze a situation without having all the (real) facts. One of the main rules of crisis communication, and perhaps my favorite, is: act in a way that would make your mother proud. What I have done these days, as a citizen, I would have expected the public figures to do: ministers to donate blood, priests to be part of the silent march…,” commented Ana-Maria Diceanu.

PR crisis expertise at the agency level PR agencies in Romania, like their worldwide counterparts, are theoretically fully equipped with talent and know-how from a professional standpoint. At the same time, many agencies promise the ability to deliver a range of many services and capabilities across sectors, some of which never have the chance to actually be taken to the execution level. So how well-prepared are the PR agencies’ specialists for real, large PR crises and how many of them are at the top of their game? According to Diceanu, “the majority of PR agencies in Romania manage negative articles, not the actual crisis situations. There are few PR people able to manage real crisis situations involving deaths or real full-time activists. As far as companies are concerned, we have seen an increase in crisis communication strategies only in these last few years. The most vulnerable companies are the

www.business-review.eu Business Review | November 2015

34 PR

Ana-Maria Diceanu, GMP PR

local ones, with limited know-how as far as crises are concerned, as well as the large companies, with a 100-page crisis manual, but without any trained professionals, and no completed crisis simulation exercises,” added the GMP PR specialist.

“Crisis specialization depends heavily on direct experience, so I would say the level of specialization varies depending on the portfolio. We have been working with major industrial companies and companies that have heavy-duty customer service activity, so we are quite experienced. Usually, international clients and industrial clients are better equipped in terms of tools and guidelines than the others, but crisis management depends just as much on the people, on their expertise, speed of decision-making and level-headedness. In the private sector, I would venture to say we are at the same level. We have been among the countries to adopt social media faster and on a larger scale than others, and social media and the online environment take crisis management and crisis communication quickly to the next level. Not all European cultures are there yet. Some of them are still more rigid, more formal, require more time for decision making and approval - all these are not features that help you in times of crisis,” concluded Sorana Savu.

On her turn, Crenguta Rosu said that within her company’s 10-year crisis communication handling programs with many large companies, they reviewed the risks, the procedures, made simulations and adjusted accordingly every year. “We did that with big industrial sites – where serious risks are part of the usual processes, from work-related risks, to incidents such as fire.

Many big companies have not only full procedures, but they implement them annually in exercises and update and adjust according to the findings. There are others that have these mapped out but not implemented/tested sufficiently.

I’m sure however this is not the case anymore as they react very promptly. In

Adina Ionescu, MOL

some of the programs we are partnering with international companies. They develop the mother company crisis management procedures and I can say we are on the same page. We are at the proper professional level, but it is to be mentioned that these subjects are more carefully considered by the clients themselves who are more aware of the communication importance,” Rosu explained.

In every agency, especially in the ones with international affiliation, there is some level of expertise, believes Corina Vintan. “In other European countries, a disaster like this would have automatically prompted the individuals responsible to resign immediately and not wait to be forced out by public protests. In Western Europe, there is a different culture of accountability and responsibility. On top of that, the answer to crises is anticipated well before on the “what if” basis and organized, engaging exclusively professionals with experience,” added Vintan.

“The big clients have the necessary pieces of information, even from a theoretical side. They have manuals and global procedures to follow. Even if they don’t have trained people for these kinds of situations, they are willing to listen and give the agencies the benefit of the doubt. For the serious crises they even send consultants to help the local teams. Most likely, the large agencies have at least one person that has been involved in handling a major crisis.

Therefore, the theoretical knowledge is backed-up by the experience,” considers Bogdan Olteanu.

Change comes from within More than ever, this unfortunate context has shown the Romanian PR industry that things need to change and that the administration and the public sector in general need proper guidance for a PR crisis. In an industry that usually is very competitive and divided, there were some admirable initiatives that prove this industry can also be very united, when needed. In the heat of the

crisis, Eliza Rogalski, founding partner & head of corporate PR at Rogalski Damaschin Public Relations, and a hand of other PR specialists, launched the PR Colectiv group through which they tried to help the system as much as possible and bring the real information to the surface. More than that, there were also initiatives to help the hospitals and the administration achieve better communication with the general public. The group already consists of 286 specialists, as I write this article. Entering the group and helping wasn’t even a decision for Anca Rancea, but a natural and normal reaction to the horrible reality of so many people to whom she expresses her sympathy and regret. “I only wish there had been more for us to do… I also wish the authorities would have relied more and/or sooner on the civil society, since so many people were eager to help, on so many different levels,” said Rancea. It was an instant decision for

Sorana Savu as well, as she was glad to be invited and to access a platform that enabled her to quickly exchange information with other people who wanted to help.

“Now people listen but they have little time to immediately implement new procedures. However - we could and we should offer our support to implement crisis handling programs. Perhaps the institutions themselves have also learned the hard way what an enormous mistake it is to neglect information during a crisis. Ionut Oprea, who first implemented the “needs google doc” also had an excellent idea - an attempt to coordinate the intervention.

That should have been picked up by the authorities, to fill in the real situation of needs and make all these efforts more efficient,” said Crenguta Rosu.

On her turn, Diceanu affirms that the first lesson in any PR crisis is to put the people first and this is how everybody

The most important do’s l Immediately assess the situation and communicate main findings (this

shows the incident is recognized and handled.) l Describe the intervention steps and next steps (this shows people know

what is going to be done.) l Constantly offer information on developments to all parties (no updates

means nothing is done in target public view. Informing media and not informing families or doctors, for example, is also a great mistake as they are the main information alternative source.) l Do not speculate - talk only on facts l Isolate the crisis team from pressures l Have a unique point of contact and quickly gather information from all sides. Cooperate on information with all involved entities. l Make information available on all channels l Monitor and correct rumors constantly and immediately l One of the most important difficulties is coordination and getting all data quick. People want to know what happened, why that happened and what is being done to control the situation. And all these are either impossible to know, take time to find out, or depend on the way the situation unfolds (for example the resistance of the injured.) This is why a quick gathering of data, continuous contact and information flow are of great importance.

By Crenguta Rosu, owner of DC Communication

www.business-review.eu Business Review | November 2015

PR 35 A more hands-on approach is proposed by Sorana Savu, who believes that the PR specialists can help the hospitals build their teams of communicators and train them. “We can create tools and guidelines for them and we can even adopt them in times of need.

We can also recommend that our clients pay more attention to supporting the crisis response and crisis management institution,” added Savu.

“I would be very happy to see, at the end of all this, an audit of the situation: what went wrong, what went well, what can be changed. There are crisis experts on the market able to help and willing to offer their support in developing a crisis plan for the future, concluded Diceanu.

Brand solidarity at its best

Anca Rancea, Freelancer PR Consultant

reacted, not only PR professionals. “All of us focused on helping those in need.

Several PR agencies tried to lend a helping hand, to talk to their clients, to help by donating and volunteering in hospitals and NGOs. You don’t need to be in a specific industry to be close to those who suffer. You don’t need to have a diploma or to be a professional to act in solidarity with the people in need. The PR industry, as any other industry these days, from food to healthcare, from pharma to transportation, from tourism to NGOs, acted as a responsible citizen through the force of individual initiatives,” highlighted the GMP PR specialist.

There is no doubt for anyone that the change we need is inside of us, no matter the level or the position we are in.

The Romanian PR industry has the capability, the resources and the talent to help change the situation in the future.

“I think the time of critics is over. I don’t find satisfaction in criticizing anymore.

The public administration doesn’t have the same access to knowledge as we do.

Let’s offer our help, let’s be supportive, let’s try to accommodate agendas so that we, professionals in the private sector are not perceived as enemies and give a helpful hand so that we, as a country, act in a professional manner,“ said the founder and managing director at Links Associates.

“There are crisis experts in the Romanian PR industry, there are people able to train communication teams in public institutions, but I do not believe in forcing your knowledge on someone just because you believe this is the right way. The members of the Romanian PR industry demonstrated that they are willing to help, now it is in the hands of the public institutions to make their move. I have seen efficient PR professionals employed in public institutions,

it is up to them to bring this problem into the limelight, and the events that occurred recently showed that this is a necessity that prevails,” reflects Diceanu.

Anca Rancea believes that every change requires a desire to change. “It is imperative to admit the problems or shortfalls and then to make efforts to change, both internally and externally.

You cannot really help people who don’t believe there is a problem or who don’t want to help themselves,” said Rancea. Moreover, she considers that in terms of communication and transparency, the Romanian Embassy in the Kingdom of Belgium set a positive example. “In terms of mobilization and civil involvement, Pavel Popescu set a very high bar. There were however, plenty of other less visible, yet concrete examples from both people and companies. In this category, the Silent March should also be noted. In terms of respect, there were some journalists who treated the subject with decency and respect, just as there were televisions who stopped advertising all together so that people could be informed,” commented the freelancer.

However, “assuming that there is a desire for improvement, I believe that a partnership between the public and the private sector would be beneficial. PR specialists could help with the continuous professional training of the communication officers within the administration and the public sector.

For crisis communication specifically, good starting points would be the development of a manual on what and how to communicate to all stakeholders for each public entity according to their role in crisis management as well as the existence of a network of volunteers that can be activated when needed,” added the freelance PR consultant.

In every bad circumstance, there’s also the good part that emerges.In the Colectiv tragedy, we saw a lot of solidarity and public involvement, but we also saw many brands trying to help and jumping in quickly to help by improving the lives of those affected by the tragedy.

From Starbucks to Vola.ro, from Medlife to Medcenter and Sensiblu, from Trenta Pizza, Calif , Joseph Restaurant, Cinema City, Mega Image, Aqua Carpatica, Oala cu Bunatati to Bavardage Delice Macaron to Fabio Pizza, Pizza PPH, Pizza Pizzicato, PepsiCo, Pizza Hut Delivery Romania etc., tons of brands were there to help and make a difference.

In the days immediately following the event in Colectiv, MOL decided to turn off their image campaign “MOL - It matters where you stop for gas” rolling on key TV stations. “We wanted to give room to the actual news to reach more people, and not to expose victims, their loved ones or even general public to commercial messaging from our part, as if nothing had happened. Let us remember that at the time, not all the victims had been even identified – so we thought it was common sense to let the

news run interrupted by our commercial. We posted an update on our Facebook page about this decision hoping that others would follow, in order to serve the greater good,” said Adina Ionescu, Communication Manager MOL. Their action was followed by other brands, while IAA circulated an appeal among media companies in order to stop commercial campaigns from being aired.

We also wondered what a brand should always do in a national crisis and what not. How far can the brand go without seeming like it’s taking advantage of a difficult situation and pushing too much PR? Adina Ionescu shows that we live in the era of “Everything speaks,” even silence. Dysfunctions can be made visible, on a large scale, in a matter of seconds – at least through social media and TV. “That is why preparing is crucial and crisis management-related plans are not a whim, but a necessity. A brand should be swift in addressing different stakeholders with relevant and accurate information. Silence or a delayed response may trigger misinformation and misleading articles which are very difficult to correct later. On another note, in the face of a tragedy, any brand should be compassionate and supportive. In a nutshell, when in crisis, based on a preparedness plan, a brand should communicate rapidly and effectively with its stakeholders, presenting facts and steps to improve the situation. Subsequently, regular updates and holding statements are necessary, in order to show transparency and avoid misunderstanding. Brands are under severe scrutiny from the general public and face real reputation risks, impact on business or even their stock listing. Establishing open channels with stakeholders is mandatory: explain, inform, be open, accept dialogue and feedback,” explained MOL’s representative. romanita.oprea@business-review.ro

Solutions: 1. Have one spokesperson – it would have been transparent and soothing to see every hour (of that night and the following day) and, in the aftermath of the tragedy, every morning, the same one person delivering all the information needed by the media and the people – the number of patients, the quantities of blood that were available for transfusion, the steps taken by each hospital regarding the patients, the equipment they needed etc.

2. Have one trustworthy source of information – the existence of a platform, maybe even of a basic website, where families, friends and NGOs could get information, would have helped all those affected by the tragedy.

A site where all the official updates were published. A site where hospitals could have stated their needs according to how pressing they were and private companies would have been able to help accordingly.

3. No bullshit – telling the truth is the best way out of a crisis. If the situation was bad, I would have wanted to know this from the beginning, maybe a few hours after the fire occurred. I would have applauded a state that asked for help in order to ensure the safety of its citizens, not a state that hides a malfunction that could cost lives.

By Ana-Maria Diceanu, head of crisis management division/PR director at GMP PR

www.business-review.eu Business Review | November 2015

36 SPECIAL PROjECT

EXCELLENCE IN BUSINESS 20 years of excellence and professionalism in the legal industry Ernest Virgil Popovici, senior partner at Popovici Nitu Stoica & Asociatii tells Business Review about what the past 20 years have meant for his company and how his firm and the industry it activates in are faring during this time. soon thus see major projects in infrastructure, agribusiness, real estate, IT & telecommunications and also in the energy field. Additionally, a new M&A wave is on the horizon, workouts and sales of NPL portfolios will complete and fresh capital will be infused in the economy. As a local independent firm, we will also pay particular attention to the Dispute Resolution and International Arbitration Practices.

These days, Popovici Nitu Stoica & Asociatii is celebrating its 20th anniversary.

In a nutshell, what would the two decades stand for?

Popovici Nitu Stoica & Asociatii has assisted in at least 150 major projects, amounting to well above EUR 15 billion of aggregate investment value, either Greenfield or M&A, public to private or dispute resolution assignments. We have also been involved in a significant number of regulatory and institution building projects. But above all, Popovici Nitu Stoica & Asociatii stands as a team of true professionals, sharing solid values, such as top-notch expertise and loyalty to clients’ cause, innovation and commercial awareness. A team of 80-plus lawyers, with many of them having built their whole career within the firm.

How do you see the firm going forward?

How do you see the legal profession’s future?

We, as PNSA, will stick with the values and principles we embraced at the outset, 20 years ago. We are a local, independent law firm. We see the team as our essential motor for development and growth. We believe in proper and competent, state of the art legal expertise and we seek to strike a good balance between people’s and the firm’s agendas.

As for the legal profession’s future, I would say that we are witnessing epochal changes, not only locally but globally, which will probably yield structural modifications. There is an inherent fragmentation here; we will soon see new bodies of practices claiming autonomy, not only barristers and solicitors, but also arbitration, competition/antitrust, legal tax lawyers, etc.

What is the secret for getting to the forefront of the market?

This merit fully belongs to the team.

In a legal practice, nothing works sustainably without a reliable team, a proper organization ethos and hard work. Additionally, it’s also steadfast commitment, from all of us: partners, associates and support staff, everyone, with no exception. Mobility at work is also a must. And there is a lot. Having seen the other day the business travel schedule of my colleagues, I noticed that all European capitals were there, from Paris to London, Vienna to Frankfurt, Geneva and Brussels. This is natural as business is going global.

Personally also, I have pursued my French-adopted nationality, the French community, and although I spend a lot of time in my Bucharest office, I do work a lot abroad.

stantly as new software is always needed. Basically, business went global in these 20 years and so has the legal profession. We are constantly adapting to it and I hope that we will always stay at the forefront.

players, numerous mergers and takeovers, partnerships, etc. And finally, there is already a market for the niche firms, specialized one-sector or oneindustry boutiques that run notable assignments.

How much have the commercial law and legal assistance services changed in the past 20 years?

Immensely. By all standards. First, it is IT that has changed the structure of the services and this is, well, still an ongoing process. My lawyer briefcase with files and statutes is now a laptop bag; I am changing smartphones con-

Turning to the legal services market in Romania, what does it look like today and what are its development trends?

I clearly see a consolidation process, with maybe 7 - 8 law firms asserted as the big firms or the top tier, handling the major projects. But there is a lot of movement in the second tier market as well, where one may see many new

What about the economy and the potential for growth of the legal service?

Which sectors do you see contributing mostly?

Definitely foreign direct investment.

We now have conditions set for a major revival of investment interest for Romania: strategically, institutionally, commercially and legally. We will

A message for your younger colleagues?

I think it is their time for better engagement with the profession and civil society in general. Younger lawyers should get more active, voice their concern and act in the public arena. We need their new spirit, novel attitudes, knowledge acquired in times of open society and free markets, throughout these 20 years we have been speaking about.

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MANAGEMENT 37

WHEN CEOS MEET AT THEIR CLUBS Sotiris Chatzidakis, executive vice president of CEO Clubs, tells Business Review about the concept behind this project and explains the added value CEO Clubs and its offshoot, Next Gen, offer to their members. all answers could be found.

∫ ANDA SEBESI

How does Next Gen improve the managerial skills for the C-Level executive?

Leadership among other things is about extroversion. Our scope is to bring good people with great skills and potential together. Such people are smart and know by nature how to excel in such an environment. Then, we provide the learning part with speakers from all over the world and top Romanian CEOs and everything else just happens naturally. This is the blessing of dealing with people with considerable intellectual capability.

What can you tell us about the added value that CEO Clubs brings to its community of CEOs? In a sentence, organizations like CEO Clubs, act as a kind of CSR for the corporate world and, consequently, for the local society The more cultivated a CEO becomes, the more inspiring he is for his employees and stakeholders, who in turn become more inspiring to their employees and families, who ultimately have a ripple effect on the whole society. And when we talk about about “personal development,” it applies to all core aspects of our lives, not just one. It’s a virtuous circle. This context gave rise to our core values: continuous learning, sharing, constant contribution and fun. We make sure we live all of them through all our activities.

How do CEO Clubs and Next Gen help top and middle managers share their business experience and learn some “management lessons”?

It’s all based on members’ trust: trust in their peers and trust in themselves that they are destined to make a difference in this world. Trust is the value that makes us accept new things in a fast-changing world. It makes us willing to challenge our status quo and make our micro-environment better and more meaningful, as well as inspire people around us to bring out the best in themselves. A leader today must be a catalyst of change and progress. And catalysts are the leaders who are not kings themselves but rather king “builders”. These leaders build sustainable organizations and leave a legacy behind; they are the ones remembered long after they leave. In this context, our job is to get constant feedback from them, come up with the topics that are related to their short and long-term challenges, match them with the right speaker and take care of the logistics (location, invitations, parking.) We all get excited when we see our members happy. For 2016, we already have even greater plans in place which we will present at our “IV Years Celebration” this January. Disruption is part of our DNA and this is the reason why we never stop to disrupt ourselves. And that’s a promise from all of us at both Clubs.

What are the main projects that CEO Clubs develops in Romania?

During the four years of our operation in Romania, we have been honoured to have a highly engaged group of members who continuously contribute with new ideas and suggestions. That means an amazing source of creativity and innovation that our team then transforms into several projects. One of these projects that we’ve evolved and enriched this year is our Advisory Boards: our members form external “sounding boards” with other peers who lead organizations in different industries. Another project is Next Gen which today is a Club itself with more than 100 members who are C-Level executives or members of the leadership team in their organizations. They meet on a monthly basis, building relationships, being exposed to new concepts and adding value one to another by sharing their knowledge and experience.

There are many more projects, but we will probably run out of space if I keep going.

What can you tell us about Next Gen and whom it is designed for?

Next Gen is the ideal place for selected C-Level executives who want to prepare for the next step. One thing that we are very proud to mention is that Next Gen is a concept that was born in Romania and thus doesn’t exist anywhere else in the world so far.

In a few months it will however, as the CEO Clubs in Dubai will introduce it to its Members in five countries: Dubai, Abu Dhabi, Saudi Arabia, Lebanon and Jordan. And this is just

anda.sebesi@business-review.ro the beginning. It’s a great achievement for all the members and our team in Romania who have worked hard on this project.

How does Next Gen help managers to become better leaders?

One of the first things that we communicate to all leaders is that it’s normal not to know everything. At the same time, we tell them that there is a way

to turn this concept into a competitive advantage for themselves: by sharing and exchanging knowledge and experience with peers. The knowledge is there. Imagine if we could gather all this wealth in a computer and, at the same time, also add the emotion deriving from the relationship that these leaders have built. If you finally add the continuous learning, you have access to a “super brain” where almost

Authors are members of

www.business-review.eu Business Review | November 2015

38 TRAVEL

Covasna – a thriving land of authenticity and tradition

All photos: Andreea Retinschi

Castles, manors and fortified churches scattered across scenic villages and unspoiled nature are all waiting to be discovered in Covasna County at just a two-hour and a half drive from Bucharest. Venture deeper, and the county promises travelers the full experience of living history and traditions, and of plenty of peace and tranquility.

Grimm Brothers fairytale: the main lodge of the Kalnoky Manor, in Miclosoara

∫ SIMONA BAZAVAN The first thing that may surprise a new visitor upon entering Covasna county in central Romania, is how easily one gets here - Sfantu Gheorghe, its main town, is located only 34 km from Brasov and around 200 km from the capital, Bucharest. The next pleasant surprise (in a long list to follow) is the rich diversity, albeit not very well-known, the county has to offer travelers.

Covasna is located in southeast Transylvania in an area inhabited mainly by the local Hungarian minority, the Szekelys. Castles, manors and forti-

fied churches set against scenic villages stand proof of the region’s rich historical heritage. Add to this welcoming people proud of their age-old traditions and crafts, and Covasna becomes a place not only worth paying a single visit to, but certainly one to return to for more.

Places to see...

It gives one the feeling of walking straight into the middle of a Grimm Brothers fairytale when stepping into the main lodge of the Kalnoky Manor, in Miclosoara. The quaint rooms are styled with Szekely antique furniture and the atmosphere is complete with

Dancing on old tunes: themed night at Castle Daniel

stove fires and the smell of apple pie and caraway tea. Upon discovering Kalnoky Manor and its surroundings, it is not hard to understand what attracted the owner, count Kalnoky Tibor, to invest in refurbishing the place.

There is a sense of living history and enduring traditions that give the traveler the reassuring feeling that time can, at least sometimes, slow down.

The count also owns the nearby Kalnoky Castle which is presently being refurbished, and several other similar properties in the region. Others like him – the most famous of which is undoubtedly the UK’s Prince Charles – have made similar investments in

bringing the manors built by local nobility back to life. There are plenty such properties to choose from, with close to 200 castles and manors scattered throughout the county, albeit sadly, not all are open to the public.

Such is the case of the Szentkereszty Castle in Arcus, where only the surrounding arboretum can be visited.

Elsewhere in Covasna, the Mikes-Szentkereszty Castle in Zagon or the Damokos-Gyula Castle in Cernat, function as cultural centers or museums.

Others, such as the Mikes Castle in Zabala, the Benke manor in Moacsa and the Daniel Castle in Talisoara, have been transformed into hotels. The latter was bought and refurbished by Lilla and Attila Racz in 2008. They had to decide between buying an apartment in Bucharest where they both worked at the time, and the 400 year-old Renaissance castle, remember the owners.

The property was refurbished and six years later, the hotel was opened to the public featuring eight rooms, each with a distinct period design.

...and things to do What is there to do after checking in, besides visiting the county’s manors and fortified churches? Quite a lot actually, say the owners of Castle Daniel and Kalnoky Manor. Nature lovers can enjoy the scenic landscapes with bike tours and horse rides, and there is also the option of off-road tours for the more adventurous. Must-see places include the Varghis Gorge with a nearby 800 meter cave, and further on in the neighboring Brasov County, the Racos extinct volcano and the Emerald Lake. Covasna’s renowned mineral springs and spa facil-

Passing on the tradition: Szoke Tibor and his son

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ities are another attraction that makes it worth paying a visit to. What are perhaps less known are the local “mofetas” (gas emanating sites) which are recommended for the treatment of various afflictions. The one in Hatuica is built over a mineral water spring and the CO2 exposure is enough to warm one’s feet in several minutes.

History buffs on the other hand can travel as far back as prehistoric times by visiting the Baraolt Museum which hosts almost a complete three million year-old mastodon fossil as well as the nearby coal mine where it was discovered, by accident, in 2008. For a more recent Renaissance atmosphere, Castle Daniel offers groups themed evenings with music, dance and complete with a dedicated menu.

Speaking of food, make sure to try local produce, especially the local traditionally-baked potato bread, as well as local Hungarian cuisine. Besides the world-famous goulash, another musttry is the paprikash, a poultry dish with a cream sauce and homemade noodles.

And no meal is complete without the local plum brandy (palinca), which two local businessmen, Dezso Tibor and Fustos Imre, are trying to transform into a premium product. Their distillery, which can be visited, produces some 2,200 liters of palinca a year under the Potio Nobilis brand. Made from fruits such as plums, pears, apples, cherries or raspberries, their product has already won numerous medals in international competitions. They

TRAVEL 39 might all seem to taste the same for the first-time drinker but the smell will definitely pleasantly surprise even non-fans.

Visiting craftsmen is another activity that should not be missed while in Covasna. Time slows down in the county’s scenic villages and it even feels like it’s standing still entirely when one crosses the threshold of local traditional craftsmen. The Suto family in Varghis has been sculpting and hand-painting furniture since 1568.

They came to the area to sculpt and paint the furniture for the Daniel Castle and the next 15 generations have strictly followed this tradition. Traditional Szekely furniture pieces such as beds, cupboards, drawers or chairs are still crafted and colorfully handpainted today in the Suto family for local, as well as foreign buyers. “We’ve received requests to do modern pieces such as bar stools, but we don’t do that.

We only do traditional pieces,” proudly says Istvan Suto. Even the tools he uses are traditional and the paints are made from local minerals. Some of the most popular pieces the craftsmen sell are traditional dowry boxes that come with a price tag of about RON 1,400 (approximately EUR 320.)

Preserving authenticity and traditional techniques is the motto of another local craftsman, Gyuri Nagy, from Talisoara. There are no templates, shortcuts or compromises, says the blacksmith who needed half a year to create the iron gates that adorn the en-

trance to the Daniel Castle. It takes skill to mold the metal using only traditional techniques and the blacksmith is more than happy to fire up his forge and show tourists how iron can be transformed into flowers. Get on the blacksmith’s good side, and he might even use the forge to indulge his guests with a special treat – fire-grilled bacon complete with local onions, Szekely potato bread and the ever present palinca.

And talking about the fruit brandy again, if you purchase some, the best way to store it and age it would be in a barrel made out of plum tree wood, recommend aficionados. This is yet another reason to pay a visit to Szoke Tibor in the village of Harale. If a hundred years ago there were over 50 families of coopers in the area, now he is the only one left. He and his family craft mainly traditional wooden barrels, ideal for aging wine or palinca but the cooper is open to the production of less conventional items as well. This includes large spa tubs made entirely out of wood that can fit up to ten people at a cost of around RON 3,000 (approximately EUR 675). Like elsewhere across Covasna, the Tibor family is happy to welcome guests and the coopers are proud to demonstrate their skills and share stories. And because people are welcoming, don’t be surprised if you will be offered some more palinca to sample yet again.

The Saint Emeric fortified church in Ghelinta

simona.bazavan@business-review.ro

Sleeping beneath centuries-old frescos in Castle Daniel

Sleepy hills: autumn landscape in the village of Harale

Field guide l How to get there: By car - Sfantu Gheorghe, the main town in Covasna, is located only 34 km from Brasov and

close to 200 km from Bucharest, meaning a two-hour, two-hour and half drive from the capital. Local roads are generally in a good state. l Where to stay: The best way to experience local atmosphere would be to opt for heritage accommodation.

Prices start at EUR 40/per person (breakfast included) at Kalnoky Manor and between EUR 80 and EUR 110 per room at Castle Daniel. The owners also offer various tour options in the region. l Local cuisine: Two places in Covasna where you could try the hearty Szekely cuisine are the Pivnita restaurant in Sfantu Gheorghe and the restaurant located on the grounds of the Benke Manor. If you decide upon the latter, make sure to drive on top of the nearby Pivnitele Mari Hill which displays an open-air art installation and offers a scenic view of the surroundings. l Cultural highlights: Sfantu Gheorghe is competing for the Cultural European Capital 2021 title on behalf of Szekely Land. Should it win the competition, it could receive some EUR 80 million to be used for investments in infrastructure and cultural projects and would make the town the go-to destination for culture lovers that year.

A colorful corner: Traditional Szekely furniture

www.business-review.eu Business Review | November 2015

40 GREEN CORNER

Social involvement through medical services Wargha Enayati, president of Regina Maria Social Polyclincs Foundation tells Business Review about how the social polyclinic project started and what the main reasons were behind this decision. ∫ ANDA SEBESI When did you start the Social Polyclinic project and what was the reason behind it?

I started the Regina Maria Social Polyclinics project five years ago by offering integrated medical services to individuals without incomes, medical insurance and for those with low income from Bucharest. Since the beginning or actually since I know myself, I have been offering free medical examinations. I think that everyone should see what could be the social impact of his or her profession. I did the same in my field of expertise. I have been inspired of course by the Baha’I confession.

Regina Maria has always been, and still is, a role model for many of us. Back in 2010, Bucharest City Hall offered us a location free-of-charge for developing the polyclinic. Trust is what made the whole project possible. I think that in building a better world, the medical gesture is a form of loving your neighbours.

All of our actions which are done for the good of others are important, not just

for those who need them, but for each of us.

What is the concept behind Regina Maria Social Polyclinics?

The Baba Novac Social Polyclinic is a social project dedicated to free of charge integrated medical assistance for indi-

viduals without income, medical insurance and often without homes. It is developed in partnership with the General Direction for Social Assistance of Bucharest (DGASMB). We transformed the lives of more than 1,700 patients with the support of 40 volunteer doctors who offered more than 5,000 free medical investigations and examinations. The first polyclinic operates exclusively through both financial and pharmaceutical donations, volunteering, disposables and partially with the support of personnel offered by City Hall.

The Regina Maria Social Polyclinic Foundation opened its second Social Polyclinic in order to offer integrated medical services for low-income individuals and families from Bucharest. It operates under a different concept as individuals with low incomes pay a small amount for the services they benefit from. We have more volunteers who work for free while the donor members involved financially each year with a sum are able to assure the sustainability of the polyclinic. There is also a social-entrepreneurial project being

planned that we hope to put into practice at the end of this year: a Persian confectionery and tea room.

How much did you invest in the two social polyclinics in Bucharest so far and what are the medical services they offer now?

For the first polyclinic, the investment was EUR 100,000 and its services have been specialised based on the needs of its patients. Except for general medicine, dentistry, ophthalmology, gynecology and echography/ultrasound are the most used services. The project of the second Social Polyclinic involved a EUR 900,000 investment including the acquisition of the location, the medical equipment and furniture. It took two years to complete from the beginning of the project and it represented a challenge for both the Foundation and all the partners involved. It offers all the medical services that the first polyclinic has in its portfolio and others like medical imaging, panoramic and conventional radiography, echography and mammography. anda.sebesi@business-review.ro

www.business-review.eu Business Review | November 2015

x-MAS 41

Ready for Christmas shopping?

∫ TATIANA LAZAR Although the weather seems like the coming of spring, not winter, and the temperatures are quite high for this period of the year, Christmas is actually coming. The capital city is bashfully putting on its winter clothes - the absence of the general city mayor who is currently under investigation may have something to do with the not-so-

Christmas-shine Bucharest we see by night. Still, we have to prepare gifts for our loved ones, even though the general atmosphere doesn’t help much. So what better place for finding unique Christmas presents than special markets and fairs?

First thing first, you should have in mind that financial advisors suggest to spend for Christmas no more than one and a half of the sum you invested in your summer vacation.

From last years’ experience, most of the shopping centers will organize indoor or outdoor fairs with traditional products and special Christmas products, while the program will exceed the normal hours. Also, an alternative can be online shopping, but you must pay attention to the delivery services and even to take into consideration that packages might be delayed till after Christmas.

When it comes to food, the statistics presented by the Federation of Romanian Tourism Patronages for last Christmas has shown that Romanians spent over EUR 1 billion on this holiday. Over 7 million ”cozonacs” (Christmas sweet bread) were bought, not to mention how many were home-made considering the fact that this dessert is traditionally served during Christmas, over 50 million liters of wine purchased and 160 million eggs consumed.

Romexpo hosts Targul Cadourilor de Craciun (Christmas Presents Fair) from December 4 to December 13, offering textile products, garments, articles, fur, leather goods, shoes and accessories, cosmetics, jewelry, perfumes, service providers, magazines and specialized publications, decorations and winter holiday products.

The city council presents Bucharest Christmas Market, which will take place from November 27 to December 27, in Universitatii Square. Besides shopping, you can also donate books and toys for children. There will also be a stage where concerts will be performed by well-known artists or carol singers.

Impact Fair brings together Romanian brands such as Upside Down, Iutta, Wundercraft, Made in Roșia Montană, Merci Charity Boutique, Fundatia Inima de Copil, Foldo, Sunday Bagels and Coffee, Fundatia Motivation Romania, Organizatia Umanitară CONCORDIA, Touched Collection, Atelierul de Pânză, Dizainăr, Asociatia Mesterilor Populari Copaceni and Social Gym between December 5-6 at Impact Hub (5 Halelor Street).

In the same Impact Hub location, Dichisar team expects visitors between December 12-13 with fun, food & Christmas shopping with mostly Romanian designers’ products.

Unfortunately, by the time Business Review went to print, no other Christmas Fair was announced. editorial@business-review.ro

www.business-review.eu Business Review | November 2015

42 WELLNESS

The greatest challenge is to make fitness fun The Ministry of Finance reported this September that Romanians have spent over RON 143 million in fitness centers, spread across the 500 wellness locations nationwide. Business Review talked with the leader of the market, Mikael Fredholm, CEO of World Class Romania and Serbia, to find out how this industry is developing at the present. ∫ TATIANA LAZAR How did you begin your journey in the wellness industry?

I came to Romania almost 11 years ago.

Before, I used to work for a pharmaceutical company in the Middle East where, by coincidence during a launch, I met the founder of World Class. Back then, we only had one club in the JW Marriot and he told me he wanted to open up the second one, in the Radisson hotel. We really appreciated each other so he offered me a job in Bucharest. For me it was a pure coincidence; I was into sports, so it sounded really exciting to start in the wellness industry in a country like Romania.

How much did World Class invest in Romania so far?

We used to belong to World Class International, the founding company in Sweden, and when we were under their ownership we didn’t invest very much. For two years now we are owned by the Polish Fund Resource Partners, so the business plans have changed. During the first couple of years we didn’t invest much because we already had the locations so the money went only into equipment.

But in the past two years, we also started to invest in infrastructure.

This year we will invest about EUR 6 million.

Photo: World Class

What have been some of the biggest challenges over the years in Romania?

From a business point of view, it’s the bureaucracy: a lot of paper work, a lot of laws and the state doesn’t help the development of such an industry. Additionally, we were kind of the pioneers of the industry, because, when we entered the Romanian market, the industry was underdeveloped and therefore required a lot of education for everyone. In the first 6 - 7 years, it didn’t change much, but then we saw how the industry started growing to what it is today, when we are actually concerned about our lifestyle. For example, let’s take the marathons and how many people are running every weekend all over Romania for different causes. And not only running, but also biking, hiking and other sports activities.

Why did you decide for the Pipera acquisition now?

We didn’t look for a new place in Pipera, but the location was great, the premises were great and the whole area is growing so much. When we opened in the Promenada Mall one and a half years ago, we had it fully saturated with members, therefore we said that there is definitely room for other clubs in the area. The investment will be almost EUR 2 million and the two centers should be opened this December.

What about the W club?

W is a different concept - it’s something exclusive, premium, as World Class used to be when we first entered the market. In the last couple of years, members have asked us for a premium club, so we said “why not.” The club only has a limited amount of members, more room and more privacy.

What is the client profile?

We have 50 percent men and 50 percent

women, 75 percent of them are between 25 and 44 years old. We are trying to attract more children with our programs, but we also came up with a program for those aged 45 and above.

In your opinion, what goals do you set when trying to lose weight or get in shape?

First of all, you need motivation. I believe every single person in the world wants to lose weight, be in shape, and feel better. However, from wanting it to actually doing something in this regard is a big step. So our job is to inspire and motivate people to keep going.

What’s happening now on the international fitness market? What are the latest trends?

In the past, people were exercising on the machines, so one of the trends today is to move to functional training - to use your own body weight and your natural movements. Another

l 18 locations opened: 15 in

Bucharest, 2 in Cluj Napoca, 1 in Timisoara l 6 new locations opened in 2015 l over 320 trainers l over 200 administrative personnel l over 5,000 subscriptions l Turnover: over EUR 11 million

trend comes from the holistic programs, like yoga and pilates. Also, the combination of indoor and outdoor training seems to be more and more popular: the example of those who go to marathons, also combine gym exercises with outdoor running. Last but not least, the biggest trend is to make fitness fun, and this is strongly related to the motivation and inspiration I was previously talking about. editorial@business-review.ro

www.business-review.eu Business Review | November 2015

44 FASHION

The chemistry behind the online platform which showcases Romanian-only designers For several years now, Molecule F has been the place to look for pieces by Romanian designers: the online platform currently has 43 designers and over 800 products, ranging from clothes to interior design products and even cosmetics and perfumes. But how did all these come together? BR went into the dressing room with Mirela Bucovicean, CEO of Molecule F, to see how this business was designed.

Local client profile: l between 30 and 40 years old l mostly women l best-selling products: dresses, Photo: Alberto Grosescu

∫ TATIANA LAZAR You have been an entrepreneur from the beginning. What was the trigger to start your own business?

It's true, I started as an entrepreneur under the supervision of my mother since I was 14 years old. Over time, the desire to learn as many domains as possible sometimes took me down to the employer path and sometimes down to the employee path. The experience I gained while working in multinational companies formed my working system and the satisfaction of my entrepreneurial successes made me persist, as well as did my inherent failures. These choices are the result of my education, focusing on my financial independence and success.

What's the story behind the brand?

In 2008, I decided to close the business that I carried out at that time in real estate. Our clients were foreign investment funds, listed on the stock market, while our main activity was brokering land, seconded by residential development consultancy projects. Then I took a sabbatical year but no opportunity to

start a new business presented itself. I was terribly bored. Slowly but surely, through my presence at many social events, I became a "socialite – glitterati."

However, it wasn’t in vain because it gave me the chance to discover Romanian designers and I began to love their work. More as a hobby than a business decision, we created Molecule F, the first online platform in the country which exclusively promoted and sold the work of Romanian designers.

tops and accessories l 45% of the products sold nation-

wide l 45% of the products sold in

Bucharest

International client profile: l best-selling products: gala

dresses, exquisite accessories l interested in the designer’s

brand, not the price l mostly sold in the UK, Germany

and Saudi Arabia l only 10% of the products are sold

worldwide What does Molecule F mean in the national fashion industry? And in the worldwide fashion industry?

To tell you the truth, at this time we do not matter much in the worldwide market. By contrast, in Romania, we enjoy the benefit of being the first on the market; we are considered a benchmark in the creative industries, not only in fashion. It’s not hard to achieve awareness; it’s hard to keep yourself in the top position. We make efforts every year, with each new project.

the designer’s creative fingerprint for every piece he/she creates. Then we pay attention to the price - quality ratio, the materials used, the cutting, finishing and last but not least, the seriousness of our supplier. Not all creatives have assimilated what a commercial agreement means, what the responsibility for partnership entails and, most importantly, the promise we make to our final customer.

How do you select the designers?

What we look for in our collaboration with designers is innovation, particularity, that red thread that demonstrates

For your business, what does online sales versus in-store sales mean?

Although they support each other from an image and even sales perspective,

we consider them separate businesses.

Each must make a profit. The online platform has the 24/24 availability worldwide advantage and a wide selection of products. On the other hand, instore you have a tactile experience as well as the certainty that what you buy fits you. In Romania, online buying is still considered a risk. Due to the lack of information or because of convenience, people do not consider the possibility of returning an order and receiving their money back in full.

Why did you open a concept store now?

Can you give me some details about the investment in the concept store, financial expectations, and sales until now?

We are not at our first offline experience. In 2013, we opened Eva - Romanian Design in partnership with DC Communication. The project lasted more than a year and a half. Now, I think the place is more important. I also had a discussion with Sebastian Mahu from Promenada mall. He told me about this mall’s client profile, about their future directions in marketing and retail. I believed in their plans, and they believed in us. The construction of such a commercial space costs somewhere between EUR 100 and 400 per sqm, depending on which utilities are provided. For the first year, we hope to sell EUR 40,000 per month.

After two weeks, we are at 70% of the target reported per day, but we haven’t started any guerilla marketing campaign so far. Experienced retailers think it's a very good start so it remains to see how it will evolve.

Tell us more about Molecule F's future plans.

International, international and again, international. This year we heavily invested in online marketing to promote Molecule F in other international markets. I also have an educational platform in mind; it’s a project on which I have been working for two years now, but more details will come when the time is right. editorial@business-review.ro

www.business-review.eu Business Review | November 2015

RESTAURANT REVIEW 45

Is it worth the trip?

The Artist. Nicolae Tonitza 13. 0728 318 8711 (TripAdvisor rated world class, and no. 15 in Europe)

When I read that an online review agency pronounced The Artist as the 15th top restaurant (by number of good reviews) in Europe, I was instantly skeptical as, of all Europe’s great capitals, gastronomically Bucharest is amongst the worst!

My skepticism was well founded when I saw that the agency was TripAdvisor. Scandal after scandal dogs these unregulated rogues for publishing bogus reviews praising hospitality businesses, oftentimes written by the owners and their friends, hiding behind phoney names.

There is even a massive pop-up industry who will write the owner reviews,

dripping with superlative praise, all for only EUR 4 per review. It’s easy money for these fraudsters as they are sitting in India and Nigeria as they write their mythical experiences. And yes, the discredited TripAdvisor will publish them as ‘real’ reviews!

I am not accusing The Artist of this practice, but it does raise my eyebrow to see the restaurant’s glorified reviews published in TripAdvisor, a new one virtually every day, and all written in an identical style with consistent grammar, phrases and syntax . It looks so, so much like the same person is writing each review day after day, year after year. Very suspicious!

So if you want to see a real review, read on, and see if the food matches the hype.

Situated on a street on the edge of Lipscani down by the river, it is boutique size, accommodating 30 covers.

With halogen lights, brushed aluminum tables and chrome-framed chairs, Blondie said it is far too bright for her. “Good for ‘foodies’, but not for lovers” she moaned. But here comes the menu. There are six starters and six mains, with all twelve dishes offered as a tasting menu, i.e. on a large spoon. Believe me, it will fill you, and at RON 115, it is well worth it.

The ‘tasting menu’ was invented by El Bulli in Girona, Spain, and exported worldwide by The Fat Duck in Berkshire, England - two of the world’s finest restaurants. I was greeted by the free ‘amuse-bouche’, a huge plate with nibbles, all ‘steaming’ in a volcano of dry ice. Pure showbiz and bravo House.

There was no seasoning on the table, which is the chef’s way of saying “I know what I am doing, so don’t mess with my food”. And he was correct, he seasoned it in the kitchen, and that was that!

The wine list was every ‘foodie’s’ dream come true. Clearly they are shooting for a top-dollar clientele, with a reasonably priced 1998 Haut Medoc at RON 220, through to an exquisite Margaux, and topped with my favorite- Chateau la Tour at RON 720.

But as I was on a budget, I opted for one of 30 well-priced, good Romanian wines instead.

Away we went with a ‘prawn cocktail’.

Forget the traditional prawn topped with a mayo and ketchup sauce. The House did it with a twist, by laying the prawn on a bed of sour apple, lemon, horseradish and a touch of Tabasco.

Clever!

Off to a ‘Camembert Parfait, with the cheese supported by crunchy granola, accompanied by a grape, root celery and a hint of Port wine. It got better still with a superb ‘Marinated Sea bass’ with a slice of Japanese radish, a mere hint of hot wasabi, with seaweed, sushi rice and a well-balanced sweetener of candied ginger.

Still on a ‘fish high,’ we dived into a ‘Salmon Fillet’ prepared Asian-style with a Thai red curry sauce, coconut milk and rice noodles. But wait, At this point I just had to register a complaint in my mind. For excellent as the food was, the strongest, hottest, spiciest and potentially dominant flavors had all been ‘dumbed down’ to meet bland Romanian standards. So it needed far

more Port wine, wasabi, Tabasco and hot Thai curry.

There were so many more dishes I just do not have the room to review such as duck, sole, beef rib, and deer steak. Suffice it to say, they were all good. So is the House truly 15th best in Europe? Not a chance! The very notion is absurd as it would imply that The Artist is better than most of the 534 Michelin-starred restaurants in Europe.

But, it is amongst the best in Bucharest, and I highly recommend it.

Oh, and do not believe anything you read in TripAdvisor. Not regarding hotels, restaurants, holidays, or airline travel prices - it’s a load of bullshit!

Chef’s tips I get bored to death with people holding back on their garlic for fear of ‘garlic breath’. Here is an eye opener there is no such thing as ‘garlic breath’.

Your breath is perfectly fine, or even pure after eating a mountain of garlic in your food. What smells is ‘garlic mouth,’ for the lazy chef has chopped up his garlic, with the result that it sticks between your teeth and rubs against your gums and cheeks. No wonder it smells.

What he should have done (and you should do likewise) is to crush the garlic with a heavy knife, add rough sea salt as an abrasive - and then furiously rub it into a glorious oily mush.

If you add that smooth mush to your food before cooking, the garlic infuses with the flavors of the dish, and voila!

No smell! So go and kiss your loved one after your meal, and if you are a woman, think of me and thank me for your odorless breath.

Michael Barclay Mab.media@dnt.ro

www.business-review.eu Business Review | November 2015

46 CITY

Cultural calendar ∫ TATIANA LAZAR Antonio Sanchez & Migration December 6, the Radio Hall

which she co-founded in 1996 and helped pioneer so-called “opera metal”.

Since 2006 she has performed solo.

Tickets are available in Eventim network and costs from RON 150 to RON

we won’t use any Pyro effects in this show, preparing a special production.

The whole Bucharest concert will be dedicated to the memory of the victims of this terrible tragedy.” Tickets costs from RON 150 to RON 380.

Oedipe December 12, the National Opera Bucharest

Jazz drummer and Oscar winning Birdman score composer Antonio Sanchez and his band Migration will perform for the first time in Romania. For jazz lovers, the Mexican drummer’s name is already known, even before his all-percussion soundtrack was featured in Alejandro González Iñárritu’s Oscarwinning, 2014 indie drama about a washed-up superhero film star taking a shot at a Broadway play. Sanchez got his start at age 5 in Mexico City, studied at Berklee College of Music and the New England Conservatory of Music in Boston, and by the 2000s was playing with Pat Metheny, Chick Corea, Michael Brecker and Gary Burton, among others.

Tickets are available in Eventim network and are priced between RON 95 to RON 155.

Tarja Turunen December 7, the Romanian Athenaeum

350.

Jurassic Experience December 7, Sala Palatului As author Noel Malcolm describes, Oedipe is one of the least performed masterpieces of the 20th century. Despite George Enescu’s self-imposed rules for composing the opera (it should not drag on; the public should not be-

After the launch of the Jurassic World movie, the dinosaur experience continues with an innovative performance for the entire family. Jurassic Experience is the story of the life of the giant mammals, which is originally brought to life, bringing special decors on stage as well as costumes, video projections and special effects. The show is recommended for children aged over three years old. The tickets can be bought from Eventim network for RON 45, RON 70, RON 100, RON 130 and RON 170, VIP seats.

Nightwish December 10, Romexpo

The queen of heavy rock is returning to Bucharest, presenting Ave Maria Christmas Tour. The Finnish singer-songwriter, a light lyric soprano with a three-octave vocal range, was previously the lead vocalist in the Finnish symphonic metal band, Nightwish,,

come bored; the listener should understand the text,) and the initially warm reception of musicians and critics, the opera (which does not feature any love duets) was not a big success with the general public when it first debuted in Paris in March 1936. The National Opera Bucharest has managed to again stage Enescu’s only opera, this year’s performance being signed by Valentina

Being the only show in southeastern Europe by the most famous symphonic metal band in the world, the Nightwish concert can host over 5,000 rock music lovers from Romania, Bulgaria, Greece and other neighboring countries. According to statistics provided by the Facebook platform, Nightwish has over 90,000 fans in Romania. In respect for the tragedy which took place in the Colectiv club, the band has recreated the entire show, the bandleader of Nightwish, Tuomas Holopainen, stated: “In respect of the fallen ones,

Carrasco under the wand of Adrian Morar. Tickets’ price is between RON 10 and RON 150 and it can be bought online from www.operanb.ro. editorial@business-review.ro