President Iohannis rejects recent populist attempts to place foreign and Romanian investment in opposition

President Klaus Iohannis said on Tuesday that he categorically rejects recent populist attempts to place foreign investment in opposition to Romanian capital.

"I categorically reject recent populist attempts to oppose foreign investments to Romanian capital, multinational companies to Romanian SMEs," Iohannis told the event "Romania's President in Dialogue with the Business Milieu" organized at Romania's Chamber of Commerce and Industry.

The head of the state underscored that he regards the business environment as the key pillar for any national construction approach.

"My deep conviction is that Romanian entrepreneurship will strengthen as cooperation with foreign investors tightens, but we need policies to encourage the integration of value-added production chains into the national economy. Production is the key to our prosperity and it's for this reason that I wanted to get into dialogue with business people who create added value in Romanian economy," Iohannis said.

"Of all EU states, Romania has record-high growth rates, we had 4.8 pct in 2016, but beyond the quantitative side of such performances, we must equally pursue the qualitative side by a more consistent contribution of investment to GDP growth. Last year, foreign direct investment reached a record high for the post-crisis period — about 4.3 billion euro, which further shows Romania's attractiveness to foreign investment, whereas the quality of these investments is also important. Net exports made a negative contribution to GDP growth, given that imports systematically outpaced exports, mainly due to consumer goods, which deepened trade deficits by almost 20 pct in 2016 and by about 27 pct in the first two months of 2017, compared to 2016," added the head of state.

President Iohannis also said that although employment has improved significantly, the unemployment rate has reached 5.4 pct, and that consistent solutions are needed to address the issue.

"We need to give impetus to those sectors with a particular potential of furthering productive value chains, such as the automotive industry, the IT & C sector and the creative industries, agriculture and he food industry," Klaus Iohannis said.

He gave the example of the automotive industry and the IT & C sector which broadly generate almost 20 pct of GDP.

În his opinion, the Government has to avoid the trap of short-term policies, arguing that otherwise the predictability will be ruined. 

"The predictability is vital. (...) The state's part, more specifically the Gov't and Parliament should take care of economic policies and generate economic and fiscal policies which can create a framework that produces a good predictability. Here we can say we are talking about the third trap which is better to avoid, thus it is generated, after all, by the wish of parties that reach the governance, by the promise of having immediate performance and then the trap which has to be avoided consists in coming up with short-term policies to the detriment of long-term policies, thus ruining the only thing that actually has to be achieved: predictability. To whom is a fiscal policy helping, one that get just like that into a public discussion, without any training and vision, to the detriment of a fiscal policy which allows an improvement of performance, which allows a predictability? Or who has ever been benefiting from an education system that changes more and more rules? (...) Therefore, the loss of predictability is to be avoided, I refer here to the governance," Iohannis stated at the event called "Romania's President in Dialogue with the Business Milieu" organized at Romania's Chamber of Commerce and Industry. 

He underscored that the people making large investments in Romania must be endorsed. 

"I believe that we have to do something to encourage the ones who make the largest investments and we are not talking about public investments. If these are made well, they produce tangible results for anyone, but if they are made for, let's say, a selected non-public group, then it's very unlikely to produce the desired effects," the head of state said. 

President Iohannis argued that the lack of infrastructure is the best proof that so far no Gov't managed to avoid the trap of creating short-term policies to the detriment of long and medium term policies. 

"If somebody did it, then our infrastructure would have been better. It wasn't done, it's not. One cannot create a network of highways in four years, no matter how cutting-age the Gov't is," the head of state revealed. 

Iohannis underscored that fiscal policies and investments must be seen balanced. 

"I cannot imagine any Romanian company to become strong and competitive receiving indications from the relevant ministry or if the relevant minister says: "Sign a contract with them, because they are our own!." I don't think it's working like that anymore. The only way towards competitiveness it's through a serious investment and healthy public policies. (...) The Gov't must come up with public policies. (...) These are things that should be made by the ones who win the elections. Currently, they are concerned with other things, but we still can hope that they would get to these things," Iohannis also said.

According to him, Romania must and can earn a praiseworthy position in Europe through performance, credibility and vision. 

"I am convinced that Romania must and can earn a praiseworthy position in Europe through performance, credibility and vision, through a joint effort of the politicians and all those who want Romania's modernisation. With this goal in mind we initiated the Country Project the business environment can make an essential contribution to," the head of state told the event "Romania's President in Dialogue with the Business Milieu" organized at the Chamber of Commerce and Industry of Romania. 

In his opinion, Romania needs responsible economic policies and healthy balances to strengthen macroeconomic stability. 

"I want to assure you that I will further advocate predictability and economic accountability for a real social partnership forged as a partnership among generations, so that the benefits of today do not translate into a heavy bill for tomorrow's generations. I continuously reference a principle according to which the balance and measure are always essential in everything we do," said Iohannis. 

He also spoke about the European and international turning point where "the technological and digital revolution will set the world on completely different bases in different reference frameworks, and national economies can take smart leaps as regards their potential." 

According to Iohannis Romania must make a serious, profound choice towards competitiveness and entrepreneurial spirit through the education system. 

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