Business Review Issue 3/2014 February 3 - 9

INTERVIEW: Director Terry Gilliam was in Bucharest in December to present his latest film, The Zero Theorem, a sci-fi movie shot in Romania. He shared a lifetime’s experience of filmmaking, and what went wrong with his Don Quixote project »page 12

ROMANIA’S PREMIER BUSINESS WEEKLY

FEBRUARY 3 - 9, 2014 / VOLUME 18, NUMBER 3

CLASSIFIEDS WEBSITES AS PRINT PUBLICA TIONS MIGRATE ONLINE, SO DO CLASSIFIED ADS. SEVERAL SUCH WEBSITES ARE CURRENTLY LEADING THE MARKET FOLLOWING WIDESPREAD PROMOTIONAL CAMPAIGNS »PAGE 8

The government has outlined plans to limit cash payments in a bid to shrink a hidden economy worth one third of GDP. Experts say electronic payments are key to improving the country’s tax take » page 7

COMING OUT OF THE SHADOW ECONOMY NEWS

PROPERTY

Aid deadline

Home improvements

Romania has around EUR 1 bln in untapped state aid funds, and companies must submit projects by early spring to benefit from the money available

» page 6

The local property market is starting to look up, as banks become more willing to lend and demand and transactions pick up

» pages 10-11

www.business-review.eu Business Review | February 3 - 9, 2014

NEWS 3

NEWS in brief

WEEK in numbers

2.5 %

BANKING

of GDP was Romania’s deficit at the end of 2013, according to data from the Ministry of Public Finance, standing at RON 15.7 billion

Local card payments up 21 percent in 2013, says Visa Europe

Photo: Mihai Constantineanu

Card payments at Romanian retailers are outstripping cash withdrawals seven fold, with direct payments growing by 20.7 percent last year, according to Visa Europe, the payments technology business.

The number of transactions involving Visa cards at retailers, including POS and online, accounted for 45 percent of the company’s total card transactions in Romania. Catalin Cretu, area manager for Romania and Croatia at Visa Europe, said that payments and cash withdrawals on Visa reach close to EUR 20 billion, while total consumer payments in Romania stand at EUR 90 billion.

Last year, the firm saw a 20.7 percent gain in debit payments, its core business, with the sums spent at retailers growing by 16.4 percent. Credit payments gained 20.5 percent while the outlay rose 13.4 percent. The average transaction at retailers fell 3.7 percent to EUR 35, underscoring the fact that Romanians use their cards to make smaller payments more often, according to Visa representatives.

Snow joke: Romania feeling under the weather Romania experienced the first heavy snows and blizzards of the winter season last week, leaving many roads blocked, road, rail and air traffic delayed and school closed. Southern and eastern Romania came under orange weather alerts, with winds blowing at speeds of up to 50 km per hour and snow more than 50 centimeters deep.

ENERGY

in local background screening start-up Mindit. The firm, founded one year ago

by Irina Arsene, checks professional information about job candidates, to confirm the claims made in their CVs or cover letters are honest. The check is performed based on the written agreement of the candidate, and is a widespread practice in the United States and Western European states.

Mol searches for oil in western Romania

One fifth of local employees cannot make ends meet

Panfora Oil & Gas, the Mol Group branch in charge of exploration and production activities in Romania, has contracted Prospectiuni SA to run surface measuring operations in western Romania, specifically in the EX-6 Curtici perimeter, in order to locate conventional hydrocarbon resources, according to company officials.

The first step is contacting and informing land owners and local authorities and communicating the schedule for future operations. The company says that geophysical data will be collected by way of the newest technology, which is safe for the environment and local communities.

Nearly a fifth of Romanian employees do not earn enough money to meet their living expenses, the highest percentage in the European Union, according to European Commission research.

The situation exists primarily because of structural deficiencies that predate the crisis, according to a report from the EC, quoted by Mediafax.

Romania (19 percent), Greece (15 percent), Italy and Spain (12 percent each) register the highest percentage of employed adults living below the poverty line, compared to the European average of 9 percent, according to a report conducted by the Employment, Social Affairs and Inclusion DG within the European Commission.

HUMAN RESOURCES Sergiu Negut buys into background screening company Mindit Sergiu Negut, a businessman with investments in Fru-Fru, 2parale and Instore Media, has acquired a 50 percent stake

PHARMA Farmexim completes EUR 16 mln logistics center near Bucharest Farmexim, the local drugs importer and distributor, opened a new logistics center

in Balotesti in January, following a EUR 16 million investment. The 15,000-sqm center has a storage capacity of over 6,000 pallets, which can accommodate over 11,000 different articles. The distributor, part of the Farmexim group, reported a 17 percent gain in its gross turnover to around EUR 340 million last year, while profits expanded by 50 percent. The group also includes pharmacy chains Help Net and beauty products importer and distributor Green Net.

TELECOM Euroweb Romania revenues up 14 percent Telecom operator Euroweb Romania, part of Turk Telekom, posted revenues of EUR 9.26 million in 2013, up 14 percent on the previous year, while its EBITDA doubled during the period, according to media sources. Data from the Ministry of Finance put the company’s net turnover in 2012 at over RON 36.5 million (approximately EUR 8 million) and total revenues at close to RON 37.1 million (nearly EUR 8.2 million). Compared to 2012, the company added 6 percent more clients to its portfolio.

Euroweb runs a fiber optic network that covers 2,000 kilometers. In Romania, Euroweb has four main hubs in Bucharest, Iasi, Timisoara and Cluj.

ANCOM: Digital TV licenses to start from EUR 300,000 The starting price for each of the five

6 th fastest internet in the world is in Romania, according to Bloomberg, quoting Akmai Technologies data. Romania had fallen three places from the previous edition, to reach an average peak connection of 45.5 megabits per second, 4.4 percent lower than the previous quarter

digital television licenses Romania’s telecom regulator ANCOM will award by auction has been set at EUR 300,000, the regulator said. The country’s telecom watchdog is in charge of allocating five national digital multiplexes in the DVB-T2 standard: four in the UHF (ultra-high frequency) band and one in the VHF (very-high frequency) band.

All the multiplexes will be awarded for a ten-year period. The licenses will be valid from June 17, 2015.

The first UHF multiplex comes with several conditions attached: the winner must broadcast ’free to air’, in transparent, fair and non-discriminatory conditions, the public and private TV stations currently being broadcast in the terrestrial analog system. With the other four, the operators must set up at least 36 functional transmitters for the network corresponding to each multiplex, before May 1, 2017.

Vodafone Romania and 2K Telecom secure EUR 10.5 mln state contract 2K Telecom and Vodafone Romania have secured a deal to provide communications services worth RON 47.6 million, VAT included (EUR 10.5 million), to the Romanian Ministry of Internal Affairs (MAI) over the next three years, according to Mediafax newswire. The two carriers will connect all the branches and employees to the institution’s internal network. In total, the services will be used across MAI 1,955 units.

Operator 2K Telecom has leased works to Romtelecom, UPC Romania, Orange Romania and RCS&RDS, according to data from www.e-licitatie.ro, quoted by the newswire. In 2012, 2K Telecom posted a turnover of RON 59 million, unchanged from 2011.

www.business-review.eu Business Review | February 3 - 9, 2014

4 NEWS TAX

3Q

Parliament set to vote on new fiscal Dan Mocanu founder and managing partner of TimePal concierge service

How does the TimePal concierge service work?

TimePal is a free-of-charge online platform that allows the client to purchase services and products without having to spend time after work to access them. This provides an average time saving of about 30 hours/month for services that can be ordered from the platform such as cleaning, car wash, regular technical inspection, auto maintenance, food supplies, gifts, cakes, drinks, chocolates, floral arrangements, massages and many others.

What is the difference between TimePal and other concierge services in Romania?

TimePal offers an affordable premium experience for businesspeople that work in medium and large companies.

It is designed as a volume business with a small profit margin with no delivery or subscription fees. Also, this concierge service combines an online facility for complex orders and a transparent cost system, with a wide range of products and services delivered on time by a team of specialists. The “secret” of the business rests in the relationship with the providers, making TimePal an integrated platform of orders and delivery streams.

What is the profile of a TimePal client?

Our concierge service addresses any professional who wants a better balance between his or her professional and personal life, who wants more spare time after work and does not want to invest time and resources alone to manage daily administrative activities. oana.vasiliu@business-review.ro

code in October

T

he government is set to submit the new fiscal code to Parliament this autumn, part of a wider overhaul of the fiscal system, as the country attempts to shrink tax evasion.

Dan Manolescu, state secretary at the Ministry of Public Finance, said last week the new fiscal code would solve a wide array of problems, citing the lack of correlation between profit and income tax in the current code.

“We are now aiming to submit it to Parliament in this session and we expect the effective approval sometime in autumn, probably in October,” said Manolescu during the annual tax conference of professional services firm PwC Romania.

The new code was initially to have been submitted to Parliament last autumn, but the government delayed it because new taxes would have been rolled out in parallel. In addition, the authorities wanted to extend the consultation period with the business community. The Ministry of Finance is also working on a new fiscal procedure code, and both should come into force in 2015. The private sector has been involved in the rewriting of the codes, with business advocacy groups such as AmCham and the Foreign Investors’ Council appointing task forces for this project.

ANAF to focus on high-risk tax payers A PwC study published last week found

A taxing conundrum: the new code should help combat fiscal evasion

that 92 percent of surveyed managers in Romania say tax authority ANAF should work to combat tax evasion.

The PwC Global CEO survey had 1,344 respondents in 60 countries, out of which 49 were local professionals. A significant share of managers said that local tax audits lasted from 6 to 24 months.

Tiberiu Vespan, director in ANAF’s vice president office, attributed the length of tax audits to the backlog of VAT refunds.

“Some 65 percent of our activity last year focused on VAT refunds,” said Vespan. He added that in Bucharest this figure stood at 90 percent. ANAF has been focusing on this field, following infringement

procedures by the EU. According to Daniel Anghel, partner, fiscal consultancy, at PwC Romania, Romania collects only 58 percent of VAT, putting it last in the EU. Vespan suggested that tax inspectors would have more time to focus on high-risk tax payers once VAT refunds thin out and the new anti-fraud department takes on more tasks. “We want to improve the risk analysis, and this is why some taxpayers will undergo more tax audits,” announced Vespan.

He added that the division tasked with investigating large estates (fortunes) should start audits and to issue rulings this year. This unit was set up with support from the IMF. ∫ Ovidiu Posirca

TRANSPORT

Local rail tycoon held over rigged auction

R

omanian businessman Gruia Stoica was taken into custody in a corruption case, accused of influence peddling over a rail transport contract involving a state-owned company.

Anti-corruption prosecutors said Gruia Stoica had paid Romanian lawyer Doru Bostina EUR 3 million to find out the sum bid by CFR Marfa, the state rail freight company, for a transport contract, in which his rail operator Grup Feroviar Roman (GFR) was also a participant.

Both Stoica and Bostina were taken in for questioning last Wednesday.

Bostina was banned from leaving the country, accused of influence peddling.

GFR was running in a tender called by state-controlled Oltenia Energy Holding for the transport of coal to three of its subsidiaries. The threeyear contract was worth over EUR 100

million. The National Anticorruption Directorate (DNA) said Bostina had lured in Stoica by bragging about the influence he had through an intermediary on the general director of CFR Marfa. The prosecutors added that Stoica’s attempts to find out the bidding price had failed.

According to media reports, Dragos Draghici, CFR Marfa director, suffered a stroke and went into a coma shortly after finding out he was implicated in the investigation.

Stoica is among the ten richest businesspeople in Romania, with a EUR 470 million fortune, according to Forbes’ list of 500 billionaires, published in 2013. He built his fortune in the railway sector and his group Grampet has participated in rail privatizations across the Balkans.

Last year, he failed to acquire a controlling stake in CFR Marfa. His company was supposed to pay EUR

202 million for a 51 percent share, but authorities said the deal had collapsed over contractual disagreements with Stoica. Under the privatization contract, Stoica’s company also pledged EUR 201 million over the coming years for an investment plan.

Meanwhile, the government will redo the privatization deal to find a viable buyer. The privatization of the freight operator is included in the precautionary loan deals with international lenders.

According to Forbes magazine, the Grampet group comprises over 16,700 wagons and 400 locomotives, alongside four plants for the construction and modernization of freight and passenger wagons.

The group reported a turnover of around EUR 350 million in 2012, while its number of employees exceeded 8,500. ∫ Ovidiu Posirca

www.business-review.ro Business Review | February 3 - 9, 2014

5

BR Awards 2014 jury begins its deliberations The jury of the 2014 edition of the BR Awards met last week to start the evaluation and selection process of the companies, individuals and projects entering this year’s contest. Ilinca Paun, managing director of Colliers Romania, was elected president of the ten-member jury which will determine the winners in 12 of the featured categories this year, with one to be decided by public vote.

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All photos: Mihai Constantineanu

Two new categories have been introduced this year, reflecting the current situation of the Romanian economy and the challenges which companies active on the local market need to take on.

The Best start-up Supporter category targets initiatives and individuals looking to boost the entrepreneurial culture in Romania. With local entrepreneurship still at low levels, initiatives that target local start-ups and entrepreneurs often undertake an educational role too, aside from offering financing.

According to the Global Entrepreneurship Monitor report, Entrepreneurship in Romania Country Report 2012, the total local early-stage entrepreneurial activity rate in 2012 stood at 9.22 percent, lower than the average in efficiency-driven economies but higher than the total entrepreneurial activity (TAE) in countries such as Bosnia and Herzegovina, Croatia, Macedonia and Lithuania, and similar to the TAE in Hungary and Poland.

The same study found that in Romania 24.2 percent of early-stage entrepreneurs are driven by necessity, while 74.2 percent are motivated by opportunity. The rate of opportunitydriven entrepreneurship went up

from 5.68 percent of the adult population to 6.92 percent in 2012. At the same time, necessity-driven early stage entrepreneurship fell from 4.09 percent in 2011 to 2.23 percent in 2012.

According to the same data, some factors that positively influence entrepreneurship in Romania are physical infrastructure and internal market dynamics, while primary and secondary education, national policy regulation and finance are barriers to it.

The Best Turnaround Strategy category evaluates the business strategies of companies that have managed to overcome difficult business moments and improve their activity. According to data from credit insurer Coface, quoted by Mediafax, approximately a quarter of insolvent companies in 2013 were potentially profitable, with poor management decisions, rather than financial under-performance, leading to insolvency. Data from the Insolvency Procedures Bulletin based on Coface methodology show that 26,372 new insolvency procedures were begun in 2013, 2 percent up on 2012 when the figure stood at 25,842.

The members of the jury for the 2014 edition of the BR Awards are: Ilinca Paun, managing director, Colliers Romania, elected president; Ufuk

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1. This year’s jury of the BR Awards meeting for its first session 2. Gerard Chandran, general manager, Mondelez International and Mihai Marcu, president of the administration board, MedLife (center and right) 3. Mamas Koutsoyiannis, director, Baker Tilly 4. Ilinca Paun, managing director, Colliers Romania, also the jury president 5. Ufuk Tandogan, CEO, Garanti Group Romania 6. Ioana Manoiu, managing partner, GMP PR Tandogan, CEO, Garanti Group Romania; Mihai Marcu, president of the administration board, MedLife; Gerard Chandran, general manager, Mondelez International; Iulian Stanciu, general manager,eMAG; Bogdan Ion, country managing partner, EY Romania; Ioana Manoiu, managing partner, GMP PR; Mamas Koutsoyiannis, director, Baker Tilly; Marga Radu, recruitment director/TA, Adecco Romania; and Mihai Sfintescu, partner, 3TS Capital Partners.

This year’s categories at the BR Awards will be: Sustainable Business

Practices; Online Strategy for Business Development; Innovation in Technology; Best Start-up Supporter; Best SMEs Financing Program; Best Turnaround Strategy; Best Employment Initiative; Entrepreneur of the Year; Deal of the Year; Business Leader of the Year; and Excellence in Business. A new category, Best Effort to Support Romania’s Image, was introduced as an audience award, and the winner will be decided by public vote at www.business-review.eu.

Simona Fodor

www.business-review.eu Business Review | February 3 - 9, 2014

6 FOCUS

Romania to embark on cashless revolution With the country’s hidden economy hovering at around EUR 40 billion, the government is planning to roll out new regulations that limit cash transactions for individuals and companies, in a move experts say must be sustained by stronger fiscal evasion legislation and tax audits. ∫ OVIDIU POSIRCA

Courtesy of Dobrinescu Dobrev

“The acquisition of works of art and property are the main means of money laundering,” Luisiana Dobrinescu, coordinating lawyer Dobrinescu Dobrev

Courtesy of Visa

According to a draft bill by the Ministry of Finance, which was published in late January, the government wants to forbid cash payments for the purchase of land, houses and cars, no matter the transaction value. Both buyers and sellers that ignore this provision would be fined.

“The fine for breaching the law, which would stand at 25 percent of the paid sum, is comparable to the VAT level, the tax which is mostly targeted for missing trader fraud,” Luisiana Dobrinescu, coordinating lawyer at law firm Dobrinescu Dobrev, told BR. “In addition, making bank payments mandatory enhances the authorities’ capacity to compare taxpayers’ effective expenses with their declared income.” She suggested this would help, for instance, investigations into public sector workers who are on a low income and yet own luxury cars and homes.

“The acquisition of works of art and property are the main means of money laundering, which is why I think this is an appropriate measure,” explained Dobrinescu.

If this measure gets through, notaries will not be able to make it official if the individual that wants to make the acquisition can not justify the source of the money, according to Marius Grigorica, senior business analyst, at DTZ Echinox, the real estate services firm. In addition, the seller willing to put the cashed in sum in a bank deposit will not be able to do it.

“Given that in our economy, according to some statistics, there are con-

Catalin Cretu, area manager for Romania and Croatia, Visa Europe

siderable amounts of “black” cash, which could have been used for the acquisition of apartments and land, it should lead to a reduction of real estate transactions. However, we think this influence will not be significant,” Grigorica told BR.

Electronic payments help shrink black economy The country’s shadow economy accounts for 28 percent of GDP, second in the EU only to Bulgaria on 31 percent, according to a 2013 study by Visa Europe, the payments technology business. Other studies have found that one quarter of Romania’s workforce is undocumented, further enhancing the role of cash in the economy. In addition, the penetration of banking services in rural Romania, where close to half of the population lives, remains limited.

Catalin Cretu, area manager for Romania and Croatia, Visa Europe, argues that reducing cash circulation could be an effective way to fight the grey market.

“We have repeatedly said that cash is the fuel of the shadow economy and we believe that this measure will stimulate electronic payments and help take part of the shadow economy into the ‘white zone’, which means higher revenues for the Romanian state that can be channeled into investments or other objectives,” Cretu told BR.

thresholds will be liable for a 25 percent fine.

“Fiscal evasion is mainly fueled by cash, and wholesalers of fruit and vegetables and consumer goods conduct almost 99 percent of their operations in cash. In addition, in the cereals and bakery sector, payments are mainly made in cash, and companies pay individuals in cash,” said Daniel Chitoiu, finance minister, in late January, quoted by Agerpres newswire. He says the new measures would stop individuals from buying cars or houses with “bags of cash”.

Dobrinescu of Dobrinescu Dobrev described the threshold of RON 2,000 as quite small. “Furthermore, considering how the draft bill is worded, it seems that the payment of an invoice in installments, which is legitimate, would be punishable,” said the lawyer.

Luisiana Dobrinescu, coordinating lawyer Dobrinescu Dobrev

EUR 39.5 bln estimated size of the local shadow economy in 2013 Source: The Shadow Economy in Europe study by ATKearney, Visa, Friedrich Schneider

He cited studies carried out by Visa, which show that increasing electronic payments of 10 percent annually for at least four consecutive years can shrink the shadow economy by up to 5 percent. The manager says that getting more companies, especially SMEs, to use electronic payments should shed more light on the underground economy. The company also launched a national strategy last year, promoting card usage in the public sector.

Lower transaction limits on cash payments The government is aiming to reduce transaction limits on cash payments between companies and individuals.

According to Mediafax newswire, cash payments between companies and to individuals will be limited to RON 2,000 (EUR 441) per day, from RON 10,000 (EUR 2,208) per day, or RON 5,000 (EUR 1,100) for a single supplier. Anything above these

Local tax collection below EU average Policymakers have promoted the latest fiscal changes, as part of a wider effort to increase tax collection. Experts estimate that the country is able to collect around 31-32 percent of GDP in taxes, still below the EU average of 3940 percent of GDP. Last year, ANAF absorbed some smaller tax enforcement agencies and redesigned its activity at a regional level, through a modernization program bankrolled by the World Bank.

The authorities also want to set up an integrated IT system in the next four years and make the overall system “friendlier” for taxpayers.

“In 2013, we reformed ANAF from the point of view of territorial structures and we reorganized all structures that previously had duties in the area of combating and reducing fiscal evasion,” said Chitoiu.

A new anti-fraud department was set up in the fiscal agency recently, tasked with investigating serious tax fraud. Last week, anti-fraud inspectors busted a Chinese-led firm that had deprived the state of EUR 9 million of tax. The firm was importing electronic appliances, without paying profit tax or VAT. The inspectors are working closely with prosecutors to streamline such investigations. ovidiu.posirca@business-review.ro

www.business-review.ro Business Review | February 3 - 9, 2014

7

State aid remains attractive financing option for local firms Romania still has around EUR 1 billion in untapped state aid funds, and local companies must submit projects by early spring to benefit from these financing facilities, said experts during the Access to Finance workshop organized by Business Review last week. ∫ OVIDIU POSIRCA

State aid split into three schemes The Romanian authorities put in place two state aid schemes worth a combined EUR 1.6 billion back in 2008, which were linked to the level of investment and the number of new jobs created. They focused mainly on manufacturing, although investments in medical and tourism sectors were also accepted.

One of the schemes, regulated by GD 753/2008, applies to investments over EUR 100 million that create 500 new jobs. This has seen limited success as out of the overall budget of EUR 575 million, a little over EUR 100 million has been accessed by companies.

A second scheme, regulated by GD 1680/2008, applying to investments ranging from EUR 5 million to over

Photo: Mihai Constantineanu

The government is planning new schemes starting in July 2014, although the allotted funding and criteria are still under consideration.

According to Iulian Sorescu, associated partner and head of the financial department at Noerr Finance & Tax, the new schemes should in theory continue to focus on manufacturing and innovative/high value added services, as authorities aim to support the creation of new jobs.

“It is very possible that the new financing percentages will not be as generous as they currently are, namely 40 percent in Bucharest region and 50 percent for the rest of the country, but will be lower,” said Sorescu.

Going forward, the EU state aid plans to put in place new regulations that could facilitate SMEs’ access to state aid, ahead of multinationals’.

State aid: Industries of interest

Iulian Sorescu, associated partner, Noerr Finance & Tax, outlines state aid options for companies

EUR 30 million, with different job creation thresholds, has proved to be very popular with close to half of the funding having been taken up.

Under these two facilities, companies can use state aid to cover investments in assets such as productive buildings, machines, equipments or licenses.

A new scheme worth EUR 136 million, regulated by GD 797/2012, was rolled out in 2012, focusing on innovative investments and targeting the IT&C and R&D sectors, and around half of the funds have been allocated. This facility allows companies creating over 200 new jobs to get finance for the gross salary and all related taxes for two consecutive years.

Sorescu explained that it takes a minimum of three to five months before financing approval is obtained.

He therefore advised companies to prepare the application and submit

Available state aid funds Total budget Used by end 2013 Available funds

Investment >EUR 100 mln EUR 572 mln EUR 109 mln EUR 466 mln

Source: Noerr Research

Investment >EUR 5 mln EUR 1 bln EUR 477 mln EUR 523 mln

IT&C investments EUR 136 mln EUR 67 mln EUR 67 mln

the Financing Request to Ministry of Public Finances as soon as possible, so as to be enrolled under the current scheme.

Under state aid law GD 1680/2008, the maximum financing level for Bucharest stands at over EUR 22.5 million, while outside Bucharest is over EUR 28.1 million.

Firms that make investments backed by state aid will undergo a five-year monitoring period, during which the authorities will check the main parameters of the investment such as turnover, profit, taxes paid to state budget, number of employees.

In fact, the local state mechanism is designed so that the government recovers the grants through the taxes it collects from companies using this facility.

How to apply for state aid Noerr representatives explained that the main documents to be included in the state aid application are the technical and economic study (or a business plan for innovative projects) and an investment plan. Beside them, a business model for existing and future period and a statement of workplaces to be created, alongside a presentation of the impact of the project in the region are needed.

The role of a professional consultant that guide the company during the application process is not only to ensure that the state aid application

Automotive Machines and equipment Healthcare Other means of transport Fiber optic cables Solar panels Plastic products Nonferrous mineral products Tourism Electronic appliances Food industry Electricity

48 percent 6.4 percent 6.5 percent 9.6 percent 3.2 percent 3.2 percent 3.2 percent 3.2 percent 3.2 percent 6.4 percent 3.2 percent 3.2 percent

Source: Ministry of Finance (2007-2012) fulfills the legal criteria, but also to structure and implement the concept of the investment project into the application.

According to Sebastian Popescu, financial advisor & auditor at Noerr Finance & Tax, the technical and economic study runs to 100-200 pages and has a similar structure for both production and innovative projects.

Sorescu added that the investment for scheme for IT&C scheme can be implemented in several locations, while the investment in production fields should be realized in a single location.

Noerr says that their state aid portfolio amounts to investment projects of about EUR 700 million which created more than 5,000 jobs in various sectors.

For instance, it assisted Premium AEROTEC, a company of the EADS/Airbus Group, in taking out EUR 18 million for a EUR 90 million greenfield investment in Romania.

Most of the successful projects were in the automotive sector, the French car parts maker Valeo and German automotive producer Continental being only some examples with EUR 9 million and respectively EUR 11,7 million state aid obtained to expand local production. ovidiu.posirca@business-review.ro

www.business-review.eu Business Review | February 3 - 9, 2014

8 LINKS

Online classifieds websites prove big hit With the number of print publications in decline, classified ads have moved online and several such websites have lately been raising a ruckus in Romania, with aggressive promotional campaigns across all channels and a number of views to match. BR talked to several players in the field to gauge the business behind the posts.

Muscling in: Mercador.ro (left) and tocmai.ro (right) are recent entries onto the online classifieds market, but are taking the fight to the rest of the market

people found that Mercador.ro was the most mentioned website by Romanians.

In terms of awareness, the platform went from the third place in 2012 to the Big names in the field include Mer- top of classifieds websites.

The number of unique visitors to the cador.ro, launched in Romania in 2010, and part of Allegro Group Romania, platform doubled during this time while along with other well-known online the number of posts increased threefold.

The announcements posted on Merventures such as Autovit.ro and Fashcador.ro exceeded 1. 6 million, up 130 ionDays.ro.

Allegro Group in its turn is part of percent compared to 2012. Approximultinational giant Naspers, a name mately 80 percent were posted by indithat rings bells in the Romanian busi- vidual owners.

“Mercador.ro’s progress last year was ness environment mainly due to the takeover of local online retailer eMag due to active investments in brand proand online payment processing com- motion campaigns as well as platform optimization, which brought fast results pany PayU. Public awareness of Mercador.ro for sellers,” says Cristina Gheorghitoiu, spiked in just a matter of months. In De- business manager at Mercador.ro.

The Mercador.ro campaign, under cember 2013, Mercador.ro reached sixth place in the SATI (Survey of Internet the slogan “Place an announcement on Traffic and Audience) ranking of the Mercador, and you will find a buyer. It’s most visited websites in Romania. By free and you can sell anything” showcomparison, in 2012, it was in 27th posi- cases everyday people in such situations as finding a new apartment after a tion.

Furthermore, according to Google breakup, buying a bike to secure a date Trends, Romanians searched for the with a jogger, buying a car to “become word Mercador last year 300 percent a man” or merely acquiring a drill to annoy the neighbors. These random more than they did in 2012.

A market survey conducted by GfK items stand for the wide array of things in November 2013 on a sample of 600 that can be found on Mercador.ro. The campaign, which included TV ads, split screens, graphic insertions, outdoor, drop mailing, direct mailing, online, and Facebook ads and banners, was creCars, motorcycles and boats 365,865 ated by The Geeks agency and resReal estate 256,068 onated with consumers, since many Fashion and beauty items 332,079 potential buyers recognized themselves Parent & child 96,990 or their acquaintances in the characters.

When asked by Business Review Sports and leisure 92,077 what investment had gone into the proTotal posts 1. 6 mln motional campaign, company representatives declined to provide details. *Source: Mercador.ro “As on any market where there are

∫ OTILIA HARAGA DIANA PETRESCU

Mercador.ro

Tocmai.ro Car sales Real estate Electronics& IT

30 percent 18 percent 16 percent

*Source: Tocmai.ro strong players aiming for the top, fierce competition and aggressive investments are to be expected,” said Gheorghitoiu.

However, the company outlined a number of improvements made to push the website forward, including the launch of mobile applications for smartphones on Android and iOS. “The Allegro Group behind Mercador.ro is present with classifieds websites in other countries, so the platform is in continuous improvement and development. (. . . ) With the delivery check service, Mercador is the first classifieds website that allows users to open packages upon delivery, following shipment by courier, so buyers can be certain they are getting the ordered product even when they cannot meet the seller face to face,” says Gheorghitoiu.

Posting a classified on the Mercador.ro website is free of charge but the seller can decide to pay to promote the ad. Therefore some the site’s revenues come from advertising sales. Depending on the category and promotion duration – which can be 7, 14 or 30 days – the price of packages can vary from EUR 2 to 7 (plus VAT). “Promoted classifieds receive six to ten times more views and naturally have higher response rates than the un-promoted ones. This is def-

initely a justified cost, especially when we are talking about real estate or cars,” says Gheorghitoiu.

She added, “The Romanian market is definitely one of the most dynamic in the CEE, but has not reached maturity yet. Apart from websites that are targeting a wider category of products such as Mercador.ro, there are also specialized classified websites such as Autovit.ro and many others.”

Last year, 870,000 classifieds were posted on Autovit.ro, of which 466,018 were car announcements and the rest products from other categories: trucks, agricultural equipment, construction machines, spare parts and motorcycles.

“On the registered car ad market, which declined by 27 percent, the number of classifieds posted on Autovit.ro decreased by just 15 percent last year.

The best month for classifieds was surprisingly December, probably due to the weather, which was warmer than usual,” said Autovit.ro officials.

Another example of successful promotion came from tocmai.ro, founded in June 2009. The main shareholder of the website is Norwegian company Schibsted, the largest classifieds website company in Europe, which runs sites in 44 countries including France, Italy, Spain, Brazil, Sweden and Norway, according to tocmai.ro representatives.

“Right now, we are covering all the counties in Romania and we have over 860,000 active classifieds for products and services,” Vasile Cucu, business development manager at tocmai.ro, told BR. The promotional campaign was put together by Lowe&Parteners Romania while the PR side was handled by GolinHarris Bucharest and the media component by Initiative. “The campaign we

www.business-review.ro Business Review | February 3 - 9, 2014

LINKS 9 million views in November and was accessed by almost 3.8 million unique visitors, making it one of the most popular websites in Romania. The number of classified ads posted increased by 70 percent compared to 2012. “Our rev- Price range Proportion of total enues come from selling ad space on number of cars the website and from the opportunity to in 2013 promote posted classifieds,” said Cucu. Up to EUR 3,000 36% Classifieds websites such as MerEUR 3-5,000 25% cador.ro and tocmai.ro complete the EUR 5-10,000 24% picture on a market where one of the piEUR 10-20,000 12% oneers was Okazii.ro, a classifieds plat4% form but also an online bidding website Above EUR 20,000 – the Romanian version of eBay. *Source: Autovit.ro “Okazii.ro promoted first in its own environment, online, outdoor and on the radio. Soon, we will be present on called instant auctions, are in fact fixedTV. The advertising budget is estab- price sales, according to Sitaru.

Fees start from EUR 0.79 and can lished annually depending on the existing needs and the situation on the reach EUR 1.99 per promoted product. market,” Radu Sitaru, CEO of Netbridge “The revenues we posted in 2013 were 20 percent higher than the previous year.

Services, tells BR. Okazii.ro was founded in 2000 by For 2014, we estimate a growth of Netbridge Services, controlled by NCH nearly 25 percent,” said Sitaru.

The online auction website has Advisors, and has reached a maximum adopted some warranties, such as the 4.2 million unique visitors per month.

“To our knowledge, there is no such delivery warranty, online payment by e-commerce platform as Okazii.ro, po- card or the verified user system. “On sitioned between online retailers and the market of online malls and auctions, growth will come from the overall classifieds websites,” Sitaru tells BR. The revenues come from commis- growth of the online market and the insion and the fees paid by sellers. Classi- creasingly sophisticated services offieds represent less than 0.03 percent of fered to users,” added Sitaru. the total listings on Okazii.ro. The platform is the only auction website in Ro- otilia.haraga@business-review.ro mania, even though some transactions, diana.petrescu@business-review.ro

Classifieds posted on Autovit.ro by price

Okazii.ro was one of the first classifieds and online auction websites in Romania

rolled out at the end of 2013 focused on the message ‘Varu’ te rezolva’ (ed. note: meaning the cuz (cousin) will fix it for you). The project brought to the forefront Varu’, who embodies the tocmai.ro brand. The character is promoting the website at national level via print, radio snippets, TV spots, OOH, key visual, media banners, PR and Real Time Marketing. Currently, we are rolling out a campaign to strengthen the idea that Varu’ could be any of us,” said Cucu.

Manuela Gogu, creative director for Lowe & Partners, explained for IQads the idea behind the story: “The creative

challenge was to develop a communication platform to consolidate tocmai.ro’s leader position. We used personification and starting from the basic concept of ‘I fix, therefore I exist’ we created Varu’. We were inspired by Tarantino’s visual style and we just added some contrasting local flavor. The name of Varu’ was assigned to contrast with the character’s overall appearance – we wanted to subvert what the general opinion of a ‘fix-it’ kind of guy looks like.

According to SATI, there were over 306 million viewed pages in December on tocmai.ro. The site received over 326

www.business-review.eu Business Review | February 3 - 9, 2014

10 PROPERTY

Residential market gloom lifts despite short-term price drops ahead After years in the doldrums, green shoots are appearing on the housing market. Banks are more willing to finance property purchases, demand is on the rise and so is the number of transactions being closed, say developers and real estate firms, leading them to make optimistic forecasts for 2014. However, there is good news for prospective buyers as well: apartment prices dropped by 8.2 percent on average in 2013, and the slide is likely continue this year too. ∫ SIMONA BAZAVAN The cost of loans in the national currency has dropped below the cost of borrowing in foreign currencies, for the first time in recent years banks are showing greater willingness to grant loans in the first place, house prices have dropped to fresh new lows with further price plunges looking unlikely in the current market conditions – a view not shared by many – and, since last year, demand has been picking up, Alina Necula, head of marketing & sales with Adama told BR. The developer sold about 15 apartments each month on average last year, up by 25 percent compared to the previous year, and now hopes to surpass that.

“Compared to the way sales evolved last year, we expect 2014 to be at least at the same level as in 2013.

A slight increase is possible, meaning that we could surpass the 200-220 units sold last year,” she said.

Bucharest will remain its most dynamic market, both because of the larger portfolio the developer has here but also because of the higher purchasing power.

Necula is not the only one who is optimistic about how things are shaping up so far. The online real estate platform Imobiliare.ro has been reporting record traffic this January.

“We expect the number of transactions to go up, especially for small apartments. Old one-bedroom units are still popular for perspective buyers.

We also expect a growing interest in new apartments, especially those with two and three bedrooms with a good location and realistic prices,” Adrian Erimescu general manager of Imobiliare.ro, told BR. Claudia Scarlat, associate director research & consulting with DTZ Echinox agrees that there has been an upturn in transactions on the residential market, “especially on the premium segment which is once again interesting for private investors after undergoing a process of price adjustment over recent years. Today there is balance between supply and demand,” she told BR. On the low-end segment too there are more deals, with the number of

Flat rate: the prices of new apartments are out of kilter with those of older homes, say players

transactions involving properties which qualify for the Prima Casa (First Home) government-backed loan scheme going up. However, the higher number of transactions on both segments is mainly due to owners reducing asking prices, says Scarlat.

What keeps going down and is anything going up?

Initial expectations were for 2013 to be a year of stabilization, and yet apartment prices dropped by close to 10 percent, more than in the previous two years combined. Sellers cut asking prices by 8.2 percent on average in 2013, according to data from Imobiliare.ro.

The sharpest drops were recorded in Bucharest where apartment owners lowered asking prices by 6.7 percent on average. This meant that the average price per sqm dropped from

EUR 1,138 to EUR 1,062 by yearend.

New apartments posted a steeper slump than old flats – 7.4 percent compared to 6.1 percent. Even so, at the end of 2013, the average price per sqm was higher for new properties – EUR 1,184 against EUR 982.

Many pundits think the market has further to fall. “Despite the fact that the signals from lenders are improving – one indicator in this regard is the unlocking of advertising budgets for credit products, as we have fielded a relatively large number of enquiries from banking clients to promote their products – we think that 2014 will bring a further slight drop in prices,” said Erimescu.

Properties that are harder to sell, such as large apartments with two and three bedrooms, will be the worst affected by this, he added. “Also, we are not neglecting the foreclosed

properties owned by banks whose share in the market, although still relatively low, is beginning to go up,” he added.

One thing is for sure, Erimescu stresses, the prices of old apartments – meaning mostly properties built before 1990 – are still falling.

However, more significant price drops could take some time to kick in, especially in homes located in so-called working-class neighborhoods.

“In Romania, the prices of old apartments are still too high compared to those of new units, the, the difference between the two reaching as much as 20 percent in Bucharest, well below that across the rest of the country. In Cluj-Napoca, the two have relatively similar levels. In mature markets, the price differences between old and new apartments are significant,” he said.

www.business-review.ro Business Review | February 3 - 9, 2014

PROPERTY 11

City Bucharest Brasov Iasi Cluj-Napoca Constanta Timisoara

Overall % Price* -6.7 -4 -3 -2.8 -2 +1

1,062 823 787 871 839 793

New units % -7.4 -6 +3.8 -3.4 -0.3 -5.3

Price 1,184 868 898 797 861 832

Old units % Price -6.1 -3.6 -3 +0.4 -2.6 +2.2

982 814 746 970 832 786

*EUR, average price per sqm at the end of 2013 Scarlat, on the other hand, predicts that residential prices will remain constant throughout the year, with any decline mostly affecting properties not bought through the First Home program. Although demand for premium apartments has gone up, this isn’t enough to guarantee that prices will follow suit. “Only premium locations will be considered attractive by private investors,” said company representatives.

Any price variation this year will be below 5 percent, Razvan Iorgu, managing director of CBRE Romania, told BR. “In a volatile market, which depends on macroeconomic developments and the progress of the First Home program, it is very hard to predict what prices will do.”

The market is currently polarized between two segments, cheap and very cheap locations below EUR 800/sqm and expensive ones, costing above EUR 1,200, he added. “For these two segments we don’t foresee significant price changes, but it is possible that apartments priced between these two levels will post slight declines,” he added.

Should there be no major economic changes, 2014 will not bring about steep contractions, thinks Necula. Moreover, price corrections of up to 5 percent are usually a feature of mature markets and prices have now reached a fair level, evidenced by the fact that demand is picking up, she added.

Nevertheless, prices may have further to fall for properties which are unprofitable on the long run, such as apartments that are more than 30 years old, for which it makes little sense to take out a 30-year loan, Adama’s head of sales believes.

At the other end of the spectrum, prices could go up where demand is highest, meaning mid-range apartments with a fair price-quality ratio, she added.

Adama has invested in building over 1,600 apartments in various residential projects in Bucharest and outside and has sold over 1,100 homes, according to company data.

Last year it invested EUR 14.1 million in expanding two of its Bucharest projects.

scheme has been, since its launch, and will most likely continue to be the main thing keeping the market afloat.

The program was set up in 2009 to help first-time buyers get on the property ladder. The state guaranteed loans of up to EUR 60,000 (for old apartments) or EUR 70,000 (new apartments) allowing would-be homeowners who would otherwise be ineligible access to mortgages.

Beneficiaries of the Prima Casa program could buy an apartment or house with a deposit of only 5 percent compared to the 20-25 percent required for regular mortgages. Last year the scheme was changed to cover loans in the national currency only.

The new lending conditions, combined with more apartments coming onto the market, led to prices dropping by as much as 4 percent in September last year.

This year some RON 1.2 billion (approximately EUR 260 million) will be available for guarantees under the program, to which will be added the leftover sums from last year.

The fact that the funds have been supplemented has reassured prospective beneficiaries, who previously feared the money could be used up, thinks Necula.

“Therefore, sales through this program will not see major changes compared to 2013. What will be interesting to see is how the banks’ strategies will influence the program.

Given that banks have launched attractive standard mortgages which successfully compete against the First House scheme when comparing monthly installments, the government-guaranteed mortgages will most likely be limited to those who can’t raise more than the 5 percent deposit,” she said.

Of course, the fact that 2014 is an election year has helped persuade the authorities to continue with the program and supplement funds, and should help boost confidence in the outlook for the local residential market even further.

One thing remains clear – until more consistent economic growth is a reality, acquisitions made through the First Home scheme will continue to account for a significant share of the market, pundits agree.

Prima Casa fuels the market The government’s First Home loan

Source: Imobiliare.ro, based on sellers’ asking prices

Evolution of apartment prices 2013 vs. 2012

simona.bazavan @business-review.ro

www.business-review.eu Business Review | February 3 - 9, 2014

12 CITY INTERVIEW

What makes a film director bankable?

Director Terry Gilliam was in Bucharest in December to present his last film, The Zero Theorem, a sci-fi movie shot in Romania, at the opening of the Bucharest International Experimental Film Festival (BIEFF) 2013. His many local fans, who value both his work as part of the Monty Python group and his solo work as the director of cult movies such as Brazil (1985), Twelve Monkeys (1995) and The Imaginarium of Doctor Parnassus (2009), had the opportunity to meet and talk to him at a master-class at Studio Cinema. that needed to be restructured to make the film work. In the end I think we ended up doing a really good film and the performances are quite wonderful!

It was an interesting experience to work that way. I didn’t do storyboards like I normally do; it was just working on instinct. We brought in only four or five people from outside Romania. Everybody else was from here, in Bucharest.

It is a great experience to see how hard people work here, how skilled they are and how good the ‘mici’ is here!

∫ ANCA IONITA How do you feel about failing with Don Quixote, just like Orson Wells?

You get in a trap, this is the danger! Tomorrow I get back to London, and the next day I go to Spain to start Don Quixote again. This is maybe the seventh time! He has inhabited me, he is like a tumor that I have to get out of my system or I’ll die. And it’s also just foolish, because everybody tells me to move on. That’s the reasonable thing to do, and I’ve never been reasonable! The sad thing is, because it has been around so long and with so much publicity, I will disappoint a lot of people! It won’t that good a film. I just want to get it out of my system. I don’t know if we will pull it off this year…

What is the problem with the film?

It’s nothing more than money; it’s always just the money! My life is about the money! So right now it’s the casting – is that guy bankable? I used to be able to do it for EUR 20 million but now I’m down to EUR 14 million. With the film The Zero Theorem, five years ago, when we talked about it, the budget was USD 20 million. We made it here for USD 8.5 million. It’s a big difference!

And the only way we made it was by coming to Romania, getting friends like Matt Damon to work for nothing, basically! It’s always good to have friends.

Everything about it is a product of being in Bucharest as well.

What is the story of The Zero Theorem and when can the public see it?

I’m hearing talk from the distributors that they are not going to put it out in cinemas but only do it on DVD! The Zero Theorem is the first one-size-fitsall, full-gate, semi-viral motion picture, the first one ever made! Do you want to know what this means? We shot in 16/9 proportion which is what you see on your modern television sets, on your iPad, on your iPhone, and so on whatever medium you are going to watch the film, you are going to see exactly the same image! No more, no less. Fullgate: when you shoot a film the gate of the camera, through which the light comes in, has rounded corners, and normally, in modern film, you use a safe area so any of the dirt that the camera catches when you are shooting is invisible. We have shown the full gate, no safety net, so it has rounded corners.

We shot on film, which is analog, as op-

posed to digital, which is viral. So half is on film, but there are 250 digital effects in the movie, which makes it semi-viral.

How did you come to shoot it in Bucharest?

Again, the default position for me, you know, like in computers, is the Don Quixote film project. Stupidly! We were working on Don Quixote a year ago (2012), but the money didn’t come through. So in July I didn’t have a job and I was very determined I was going to make a film out here. The Zero Theorem was a script that was floating around four or five years before and I never got involved in it properly. The producer was still interested in doing it.

We ended up doing it for a third of the initial budget, and that’s why we had to come to Bucharest, because it’s lovely and cheap. I am really grateful to have had the chance to come to Bucharest. I have fallen in love with this place.

The script was odd. It was full of good ideas, existential ideas. I just jumped into it. By the third week of July I got Christoph Waltz to agree to be in it, and by October 5 we were shooting the film. For anybody who has been involved in filmmaking it’s impossible to go from that point to shooting in such a short time! I just got a lot of friends to come and be part of the process: Matt Damon, Tilda Swinton, David Thewlis, Ben Whishaw. It was a very frenetic experience. We had very little time to prepare. We had to build this incredible chapel at the MediaPro studios, we had to get permission to shoot in the streets of Bucharest, by the bank of Marmorosch (n.r. today’s National Bank – BNR) and on Calea Victoriei.

It was an interesting experience because in the editing, in many ways, we kind of re-wrote the movie. It always happens in the editing, but this was more interesting because we had a lot of material that was interesting in itself

Why do you make films?

The only reason to make films, as far as I am concerned, is to open windows and doors to other ways of looking at the world. You can either agree with me or not, or it might get you inspired to do your own film. But films, hopefully, are the beginning of other people’s adventures or creative attempts. Just to entertain doesn’t interest me, and action films are wonderful but I don’t know how to make them. So I do what I can.

I also like the idea of making films that are difficult to make because I want to keep proving to the distributors and studios that there are many audiences out there and there are lots of intelligent people and if you give them really intelligent films they will come, they will respond! The studios tend to think we are all stupid, and we just want to see Fast and Furious 29 and Pirates of the Caribbean 110. All those films are fine, but the idea is that we just have to keep eating the same ideas.

It gets very depressing for me.

For a long time audiences have been dumbed down, given the same kind of juvenile films, and we keep seeing the same thing again and again and again. I watch trailers, but they are all the same movies – the costumes look different, with different actors, but they are telling the same kind of stories. I’m not saying they are bad movies, because some of them are very good: good performances, good writing, technically they are brilliant. But somehow I think if you keep giving people a limited selection of food they get used to that rather than asking for the whole range.

All I can do is compare to what it was like in the ‘60s and ‘70s. What you could see in the cinema was incredible – you could see an Italian, or a French film, or a Spanish film, or a Yugoslavian one, it didn’t matter! It was alive and everybody was excited. anca.ionita@business-review.ro

www.business-review.ro Business Review | February 3 - 9, 2014

CITY 13

RESTAURANT REVIEW

AWARDS

Booking a table at Reader’s Café Situated in the Victoriei area near several office buildings, Reader’s Café is still one of Bucharest’s posh places where you can enjoy a wide-ranging gourmet menu that runs from Lebanese tapas and sushi to warm pasta or meat dishes.

OANA VASILIU The bistro is probably one of the most active online, where its webpage is weekly updated with information on its events and Dish of the Day menu.

For RON 22, I had the second best tomato soup in Bucharest (first place still occupied by Lente’s tomato soup) and white fish fillet with pomegranate sauce and caramelized vegetables.

Although the fish wasn’t as tasty as I was expecting, the pomegranate sauce saved the dish. Be warned that this lunch menu isn’t available until 4 o’clock, while the food is rapidly ordered by the businesspeople who work nearby. Currently, the lunch offer consists of the “Let’s do lunch together” concept, where the new menu covers the customer’s favorite products, from appetizers to hot and side dishes.

Last month, I had the Reader’s Breakfast; for RON 29 the menu included a country style omelet, green salad, butter, honey, mini viennoiseries, toast, coffee and fresh orange juice. The W. Somerset Maugham quote, “To eat well in England, you should have breakfast three times a day,” is written on the breakfast page of the menu, and the subtle irony put

The write stuff: four Romanians go into hat for Nobel Prize for Literature Romania has nominated four writers for the 2014 Nobel Prize for Literature: Nicolae Breban, Mircea Cartarescu, Norman Manea and the former economy minister, Varujan Vosganian.

a smile on my face as the bistro doesn’t offer anything similar to an English breakfast.

Pour les connoisseurs, there are smooth jazz concerts almost every evening, which can be “consumed” with one of the most comprehensive ranges of top local wines – Aurelia Visinescu, La Certa, Crama Basilescu, to name a few – and light pasta, salads, sushi or warm dishes. For dinner here, a good tip could be the parking facility, as you can park your car in the Metropolis Center underground parking lot after 7 pm.

A big plus is the well separated smoking and non-smoking sections, as well as the minimalist interior design and the book area you have to pass through to enter the bistro. The space is used for temporary, contemporary art exhibitions, mostly photography and paintings.

The only drawbacks of this place are the lack of advertising of the live concerts that are held there and the Romanian author Norman Manea’s work has been translated into 20 languages “closed on Sunday” announcement.

Address: 56-60 Iancu de Hunedoara Blvd., Metropolis Center, telephone: 0737 323377, open Mon.-Sat. 09.00-23.00. oana.vasiliu@business-review.ro

Reader’s Cafe has a minimalist interior and smoke-free atmosphere

OANA VASILIU The Romanian Writers’ Union had to send its proposals by February 1, for the candidates to be taken in consideration.

The union is one of the institutions that receive invitations from the Swedish Academy to nominate writers for Nobel Prizes. The main criteria for nominations this year was the value of the writers and the translation of their works into foreign languages, according to Mediafax newswire. Speaking to RFI, Nicolae Manolescu, president of the Romanian Writers’ Union, said that the process wasn’t that difficult, as three of the names were also put forward last year, while Norman Manea has built an international writing career which has been blooming for several years now.

He also stressed about the value of the nominees’ books and their careers as novelists, as this award is given especially to those writing in that genre.

Manolescu pointed out the importance of Swedish translations of the books, which all of Romania’s nominees have.

Mircea Cartarescu and Norman

Manea are among the best known Romanian writers abroad whose books have been translated to foreign languages. Manea, who has become a major contemporary Eastern European writer, is the most translated Romanian author, with books in 20 languages.

Cartarescu is a poet, novelist and essayist, a member of the Romanian Writers’ Union and of the European Cultural Parliament. His works have been translated into more than 14 languages, bringing him international fame.

Former minister Varujan Vosganian writes poems and fiction. His latest books include Jesus with 1,000 Arms – Poems, from 2004, and The Book of Whispers, from 2009.

Nicolae Breban is a novelist and essayist who has been writing since the 1960s. HIs novels have been translated into French, Italian, English, Russian and Swedish, among other languages.

Romania has never won the Nobel Prize for Literature, although Romanian-born Herta Muller, a German writer, won the award in 2009. oana.vasiliu@business-review.ro

www.business-review.eu Business Review | February 3 - 9, 2014

14 WHO’S NEWS

County prefect sacked in snowstorm 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

Florentina Totth

has been appointed country president of the local subsidiary of French firm Schneider Electric, the maker of power equipment and provider of energy efficiency solutions. She is the first Romanian to head the local subsidiary since its creation 17 years ago. Totth is replacing Saulo Spaolanse, who has been appointed to the same position at the company’s Singapore subsidiary, after spending three years in Romania.

Totth has extensive experience in sales, marketing and general management, with a focus on IT&C. She was district manager of APC, a provider of power protection products that was acquired by Schneider in 2007, between 2003 and 2007. She served as country manager of the company through to 2008 and was managing the Romanian and Bulgarian operations by 2009. She later held a management position at Schneider Electric, overseeing the IT, power solutions & services and buildings and energy divisions.

Francois Petry

is the new CEO of the Romanian subsidiary of cement manufacturer Holcim. He is replacing Daniel Bach, who has been recently appointed area manager for South-East Asia.

Petry, 47, was appointed to the role from the position of general manager of aggregates at Holcim France.

He had held this position since 2008 when he joined the group. He previously worked for a construction company for nine years and for another eight years prior to that he was a general manager in the waste industry. Petry holds a degree in engineering from the Ecole Nationale Superieure d’Arts et Metiers, ParisTech, as well as an executive MBA from the Ecole des Hautes Etudes Commerciales de Paris (HEC). Bach, 50, had served as CEO of Holcim Romania for the past three years. In his

new position, he will be responsible for Holcim’s subsidiaries in Indonesia, Thailand, Philippines, Vietnam, Malaysia and Singapore.

Jeongwoo Kim

is the new CEO of Samsung Electronics Romania, a position from which he will coordinate the activity of the Romanian and Bulgarian branch. Kim is replacing Young Lak Jung, who has led the Romanian branch over the past four years and will now be embarking upon a global career at Samsung Electronics in Korea. During a 25-year career at the electronics giant, Kim has gained experience in different departments, such as human resources, sales and marketing. From December 2011, he was president of the company for the Baltic region. Between 2008 and 2011, he coordinated Samsung’s marketing activities at global level while from 2002 to 2008 he was telecom business manager for the Eastern European countries.

Florin Stoleriu

has been appointed business unit director of Policolor’s architectural division. He has over 16 years of experience in sales management. Prior to joining the dyes manufacturer, Stoleriu held management positions in the sales departments of several FMCG companies. Between 2003 and 2005 he coordinated the trade marketing activities at InBev Romania and afterwards was appointed senior brand manager for German brands at the same company. He later served as modern trade director, developing international KA sales. Between 2009 and 2012 he worked for Fabryo and Bergenbier as retail sales director and traditional trade sales director, respectively. In 2012 he founded a consulting company specializing in the management of sales and leadership. Stoleriu graduated from the Electronics Faculty of the Gh. Asachi Technical University in Iasi and the ASEBUSS executive MBA program.

FOUNDING EDITOR Bill Avery PUBLISHER Anca Ionita EDITOR-IN-CHIEF Simona Fodor JOURNALISTS Otilia Haraga - senior journalist, Simona Bazavan, Ovidiu Posirca, Oana Vasiliu COPY EDITOR Debbie Stowe PHOTO EDITOR: Mihai Constantineanu

ISSN No. 1453 - 729X

LAYOUT Beatrice Gheorghiu ART DIRECTOR Alexandru Oriean

aftermath, more could follow Gabriel Balta, the prefect of Buzau county, was dismissed last week for failures in handling the response to the recent snowstorms, PM Victor Ponta announced. Most of the country was affected by the bad weather, leading the authorities to issue a code red weather alert – the most severe – for the first time ever. As always during such episodes, central and local authorities came under intense scrutiny for the way they handled the situation.

Asked by media representatives how many localities in his county were isolated by snow, Balta was unable to provide an answer. He added that the prefecture did not always have the time to answer the phone. Balta has been Buzau county prefect since May 2012. Prior to that, he held various positions in the local administration.

After the announcement of his dismissal, the PM said he would like to see “more competency” in the way the authorities respond to adverse weather. On Wednesday, the minister of public administration and vice prime minister Liviu Dragnea said that he would call for two more prefects and an under-prefect to be sacked. One of

the two prefects will most likely be Gheorghe Obreja, the head of Braila’s local administration, who managed to get stranded between two villages while making a field inspection.

County prefects can be replaced only by government rulings. They represent central government at local level, and are appointed to the position by the central authorities, unlike mayors, who are elected.

Buzau and five other neighboring counties were under a red alert for severe weather last week. While the south east of the country was the hardest hit, heavy snowfalls and blizzards affected most of Romania, with the exception of Transylvania.

In Bucharest and elsewhere transport was severely disrupted. The A1, A2 and A3 highways and numerous national and local roads were closed for long periods of time. Over 160 trains were cancelled while many of those still running suffered delays of over an hour. Schools remained shut for the entire week in some areas. By the end of the week, some villages were still cut off and more than 5,000 power failures had been reported.

Dan Timotin

pointment becomes effective in February. Timotin joined the bottler in July 2011 in his current position. Since 2011 Coca-Cola HBC Romania and Moldova has promoted five managers to group level.

presently financial director with CocaCola HBC Romania and Moldova, has been promoted to group level as commercial finance director. He will report directly to the group’s CFO. The ap-

HIDROELECTRICA is the leader in electricity production and the main supplier of technological services for the National Energy System of Romania.

Hidroelectrica wishes to name a new Management Board which will be accountable to the Supervisory Council and will lead the company to reaching all of its objectives.

The candidates need to have experience in management roles, with a remarkable track record in reaching set objectives and leadership capabilities. For more information please consult www.hidroelectrica.ro or www.choiceconsulting.ro.

Those who are interested can submit a CV and a letter of intent at the email address hidroelectrica@choiceconsulting.ro until March 3rd, 2014.

EXECUTIVE DIRECTOR George Moise SALES & EVENTS DIRECTOR Oana Molodoi SALES & EVENTS Sales managers: Ana-Maria Nedelcu, Oana Albu, Raluca Comanescu Sales executives: Ana Maria Andrei MARKETING Ana-Maria Stanca, Catalina Costiuc, Iulia Mizgan PRODUCTION Dan Mitroi DISTRIBUTION Eugen Musat

PUBLISHER Bloc Notes Media ADDRESS No. 10 Italiana St., 2nd floor, ap. 3 Bucharest, Romania LANDLINE Editorial: 031.040.09.32 Office: 031.040.09.31 EMAILS editorial@business-review.ro sales@business-review.ro events@business-review.ro