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Fondul Proprietatea's Konieczny: There is potential for positive developments in Romania's economy

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There is potential for positive developments in Romania's economy, as it can stand to benefit from a recovery of global growth that seems to be gaining momentum and an uptick in global trade, fund manager of Fondul Proprietatea sovereign fund and Deputy Executive Chairman of Templeton Emerging Markets Group Greg Konieczny said in a press release issued in Thursday.

In his opinion, there could be further acceleration of growth. The World Bank is expecting Romania's economy to advance 2.5 per cent in 2014, but the growth could be even higher if farm year 2014 is similar to farm year 2013, when sizeable crops of maize, wheat and barley boosted exports, reads the release.

According to Konieczny, exports will probably be one of the engines of Romania's economic growth in 2014. Opportunities are also forecast in the areas of services, energy and the automotive industry. Moreover, Romania's economy should be boosted by a higher absorption rate of European structural funds and a boost in commercial and residential construction.

Konieczny says one of the strongest contributors to growth could likely be consumption. Domestic demand in Romania has been picking up very slowly in the past couple of years but, with record low inflation, decreasing interest rates, low and stable unemployment levels and a low base compared with 2014, it could improve in 2014.

He is not expecting any significant increase in inflation in the next 12 months.

In Konieczny's opinion, an even greater involvement of individual investors would be another key element in the development of Romania's stock market.

Fondul Proprietatea is a joint stock company operating as a closed-end investment company for an indefinite time, registered in Romania and floated on the Bucharest Stock Exchange (BVB) as from January 2011.

The company was established by the Romanian Government in 2005 with a special purpose to provide compensation in the form of shares to owners whose real estate assets were confiscated by the late communist regimes of Romania and who can no longer receive restitution in kind.

 

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