Romania as the destination for SSCs and BPO

KPMG in Romania

kpmg.com/ro

Contents

Introduction Chapter 1: Key facts on Romania for Investors Chapter 2: Romania: an attractive SSC and BPO destination Chapter 3: Main cities in Romania Bucharest Cluj-Napoca Timisoara Brasov Iasi Constanta Targu-Mures Arad Oradea Chapter 4: Key facts on the Republic of Moldova Chisinau KPMG: Multidisciplinary teams with in-depth industry expertise

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Romania as the destination for SSC and BPO | 3

Introduction
Romania is one of the largest countries among those which have joined the European Union (EU) over the last decade, with a population of around 21 million. EU accession in January 2007 acted as a stimulus to investment and the economy showed strong growth before the recession hit. Since the second half of 2008, investment has declined and the effects of the recession have been felt, with significant falls in consumer demand. Moreover the Government has implemented austerity measures, as part of an agreement with the IMF with some positive , results. In July 2011, Fitch improved Romania’s long-term debt rating for both local currency (RON) and foreign currency. Romania continues to present many opportunities for investors and some investments are still underway. This publication presents a basic overview of Romania and its main cities to support new investors which want to enter the Romanian market and existing investors which want to undertake additional activities and expand their scope. In particular, this brochure gives relevant information related to Shared Service Centers (SSC) and Business Process Outsourcing (BPO) activities in Romania, as this has been a particularly dynamic sector for investors over the past decade. This has been recently reflected by a significant increase in the number of SSC/ BPO set-ups, while a surge in these activities is expected to occur in 2011 and 2012, in the light of expected government incentives to IT-related sectors. While this publication addresses relevant areas, it does not provide the in-depth information needed to make investment decisions. As matters in Romania are still subject to frequent and rapid change, we recommend that you obtain comprehensive advice before taking any investment decision.

Richard Perrin, Partner, Head of Markets KPMG in Romania

4 | Romania as the destination for SSC and BPO

1.Key facts on Romania for investors
Country Snapshot Country area Population Official language Capital Currency Average RON/EUR (2011) Average RON/USD (2011) Inflation rate (2011) Unemployment rate (2011) GDP per capita (2010) Time zone Climate 237 ,500 sq.Km 21 million Romanian Bucharest Romanian Leu (RON) 4.2 3.0 6.5% 6.5 % EUR 5,700 GMT + 2 (GMT + 3 in summer) Temperate-continental climate, with four distinct seasons

This was accompanied by a significant increase in the budget deficit and a depreciation of the domestic currency.5% of GDP in December 2009. reaching RON 4. from an annual average of RON 4. Although the contraction of the Romanian economy was severe. while 2012 growth is expected to be 4% (National Commission for Prognosis).22/EUR at end of August 2011. Both exports and imports are expected to have an annual growth rate of 10%. from 11. the Romanian authorities signed a loan agreement with the European Union. the Regional Cooperation Council (RCC).5% in GDP is estimated for the current year. which can be used to finance eligible investment from the state budget. At the end of 2009. while gradually decreasing and meeting its target of 3. . particularly aiming to develop rural SMEs Romania is a member of the European Union. As a consequence. which recorded a 3. along with the expected improvement in absorption of EU funds. Growth of 1. Romania’s macroeconomic position improved. as well as the Organisation for Security and Cooperation in Europe (OSCE). In 2011 inflation is expected to stay relatively flat compared to the previous year. but picking up in the third quarter of 2010. Against this background.5%.20/EUR in 2010. the International Monetary Fund and other international financial institutions. and the recession is predicted to become less severe by the end of 2011. the International Monetary Fund (IMF).5% for 2012. the inflation rate fluctuated. the United Nations. declining gradually by the end of 2009.1% fall in GDP in 2009. the European Bank for Reconstruction and Development (EBRD). The macroeconomic environment in Romania for the period 2011-2013 is expected to be more stable. Nevertheless. as a consequence of an increase in the VAT rate from 19% to 24% in July 2010. The main expected government priorities for 2011-2013 are: • • • • A revamping of the IT sector by introducing state incentives to boost employment Co-financing projects benefiting from European funds Environmental infrastructure and road rehabilitation An investment program for the rural economy. the World Trade Organisation (WTO).6% of GDP in 2008 to 4. worth EUR 20 billion. the main objective being to reduce public expenditure and achieve greater efficiency.Romania as the destination for SSC and BPO | 5 Brief overview of Romania’s economic environment The recent development of the Romanian economy has followed the trend of the Central and East European region. The local currency has also been relatively stable. at 6.8% GDP surplus. Growth in internal demand is considered to be the main factor that will determine economic recovery. while the public sector increased its deficit by 3 percentage points. in April 2009.It is also a party to the Central European Free Trade Agreement (CEFTA) and the United Nations Conference on Trade and Development (UNCTAD). followed by a 1.3% decline in 2010. as the current account deficit had narrowed. NATO.23/ EUR in 2009 to an average of RON 4. registering a 7 . this adjustment was made entirely by the private sector. fiscal consolidation measures were needed.

207 4.R.59 6.2 Source: National Bank of Romania.753 7 .21/EUR in 2010.5 6. the gross nominal average wage was EUR 472. while the net nominal average wage was EUR 343. * Analysis based on paid-in capital figures.734 -7 .6 bn. Romanian Agency for Foreign Investment The local currency has also been relatively stable since 2009.655 -6.370 6.250 2008 9.3 30.034 -1. Austria and Germany.8 -33. Human Capital and legal aspects of employment in Romania One of the largest markets in Central and Eastern Europe (ranking 7th).C capital figures. However.0 38.21 2011 (estimated) 4.7 -36. the country’s macroeconomic stabilization and the benefits of European Union membership.6 -24. Year Average F/X rate (RON / EUR) 2006 3.3 13.3 2011 (estimated) 129. The Economist Intelligence Unit. National Commission for Prognosis.237 6. In February 2010.8 2009 119.85 5. with an annual average of RON 4.236 -4.596 5 months 2011 799 Source: National Bank of Romania.24 2010 4.18 2012 (estimated) 4. reflecting large-scale privatizations. reaching RON 4. The highest net nominal average .24/ EUR in 2009. FDI by activity (2009) 19% 42% 1% 7% 8% 8% 7% 6% 6% 6% 4% 32% Top countries that have invested in Romania 13% 5% Industry Real Estate & Construction IT&C Transport 10% 13% 12% 1% Support services Trade Hotels and restaurants Financial Sevices Others Greece France The Netherlands Holland Austria Spain Germany Great Britain Cyprus Switzerland Agriculture. an average of RON 4.891 3.30 2008 3.5 6. The Economist Intelligence Unit.5.752 5.C * Analysis based O.R.1 23.694 7 .22/EUR at end of August 2011.N.6 | Romania as the destination for SSC and BPO Key Economic Data Key Indicators Nominal GDP (EUR m) Real GDP Growth (%) Total public sector debt (%GDP) Government deficit (EUR m) Trade balance (EUR m) Inflation rate Unemployment rate 2008 139. in the context of overall economic decline in Central and Eastern Europe.496 2009 3. Year FDI Value (EUR m) 2006 9.305 -8.09 7 . the amount of Foreign Direct Investment has declined steadily since 2008 as a result of both external and internal economic pressures.5 39.53 2007 3.401 -8.488 2010 2. Ministry of Finance FDI and Key investors in Romania Romania has become a very popular FDI destination.059 2007 7 .68 2009 4. Forestry and Fisheries Italy Source: O.8 -4.673 1.9 2010 127 . Source: on paid-in 2.N. Romania has over 21 million inhabitants and a highly skilled workforce with low costs.4 2012 (forecast) 141. Total foreign investment in 2010 was EUR 2.5 -5.18 Source: National Commission for Prognosis Top 10 FDI in Romania by country of origin The top three countries of origin in terms of Foreign Direct Investment* are: the Netherlands.706 -5.

while the net average salary was EUR 331. employers were under strong pressure to increase salaries. the upward trend for wages has come to a halt. investors are attracted by the availability and qualifications of the Romanian labor force. . Romania has over 21 million inhabitants and a highly skilled workforce with low costs. In 2010. However. The highest net average earnings were registered in the aviation sector (EUR 771). as the economy began experiencing the effects of the global recession. The good quality of the Romanian education system and sound knowledge of foreign languages have allowed Romanian professionals to meet the growing expectations of companies both locally and abroad. the average gross salary was EUR 454. medical packages and sponsorship of recreational activities. as an increasing number of graduates were seeking employment overseas. These factors have been perceived as key advantages of investment in Romania. The National Institute of Statistics releases a report each month presenting the level of gross and net average salary by activity. Until 2008. while competing for talent with other local companies. relocation options. In addition to the cost aspects. Although financial remuneration is still decisive. but also at the regional level. particularly in labor-intensive sectors. professionals are also interested in non-monetary benefits and rewards.Romania as the destination for SSC and BPO | 7 Human Capital and legal aspects of employment in Romania One of the largest markets in Central and Eastern Europe (ranking 7th). while the lowest were in hotels and restaurants (EUR 188). such as career development opportunities.

A deduction is generally available for compulsory employee social security contributions.) EUR 485 EUR 354 2012 (forecast) EUR 508 EUR 370 Source: National Commission for Prognosis.20% 0. National Institute for Statistics Immigration Literacy rate 98% Generally. 2.50% 0.3%) is capped at 5 times the average gross salary (i.000 on the nationality of the individual. EU nationals can obtain five year permits.80% 5. Work permits are generally required for non-Romanian individuals who are employed by Romanian employers or who are seconded by their non-Romanian employers to perform work on Romanian territory. Longterm visas are valid for stays of up to 90 days within a 6-month period and can be used to apply for Romanian residence permits.8 | Romania as the destination for SSC and BPO Top 10 University centers (2009/10) (graduates per year) Source: INS (National Institute for Statistics) Key human capital facts Salary Average gross salary Average net salary 2009 EUR 472 EUR 343 2010 EUR 454 EUR 331 2011 (est. The main Romanian social contributions are: Contribution Social security Health Fund Unemployment fund Risk fund Salary guarantee fund Medical leave and allowances Source: Romanian legislation Employer 20.25% 0. the Romanian immigration rules for non-Romanian nationals depend University graduates (yearly average) 215. for the employer.15%-0.85% 0. The basis for applying the social security contribution (31.022 RON for 2011) for the employee and at the number of insured persons multiplied by 5 times the average national salary.50% 0. Income tax and Social Contributions Net taxable income is taxed at a flat rate of 16% for residents and non-residents.50% 5.e.85% (capped) Employee 10.50% - . Romanian residence permits are generally issued for 1 year and can be extended for successive one-year periods.

Romania’s Infrastructure Romania’s infrastructure is relatively undeveloped compared to the CEE peer countries. Romania is eligible for EU funding worth EUR 4. but so far only 10% has been completed. There are large amounts available in EU funding to support infrastructure projects. However.Napoca Arad Sibiu Timisoara Targu Mures Brasov • Italy • Turkey • Italy • Germany • Austria • Greece • France Bucharest Constanta • Spain • Austria • Germany • Europe • Middle East • North Africa Source: Airline companies’ Source: Airline companies’websites websites . The Transylvania motorway will be 415 km long. with the right approach by the government. a national infrastructure development program could bring opportunities for the private sector. Despite being the ninth largest country in the EU.4 billion for transport infrastructure by 2013. and so far modernization has been slow. The key motorway projects include Medgidia-Constanta and the Trans European Corridor IV Nadlac-Constanta (Transylvania motorway). The main Romanian cities are also connected to large European cities by direct flights. According to a World Economic Forum report. one of the main problems that Romania faces is its degree of absorption of funds for developing its infrastructure. and. with significant improvements in the road and rail networks needed to bring them up to European standards. There are 313 completed km of motorways and another 276 under construction. but so far only a small proportion of this has been absorbed. according to the Ministry of Transportation. as many regional and global airlines have expanded their reach to the country’s main economic hubs: Direct flights from main Romanian cities • UK • Italy • Spain • France • Germany • Austria • Germany •Hungary Oradea Iasi •Austria •Italy •Turkey Cluj. which is less than three percent of the German motorway network. Romania has only 313 km of motorways.

there were a few large investments that amounted to EUR 712 m in 2010 and employed cca 5.5 million (for investments in the Bucharest – Ilfov region). Government incentives supporting investments over EUR 100 million Large enterprises can be granted financial support for initial investment exceeding the RON equivalent of EUR 100 million. Grants are also available. the steel industry. including real estate tax exemptions. qualifying for total state aid of EUR 215 m. as well as preferential tax deductions for the purchase of new technology and R&D centres. The maximum level of the grant an economic operator can receive is the RON equivalent of EUR 28 million (for investments outside the Bucharest – Ilfov region) or EUR 22. Lufkin and Remar are just a few of the investors that benefited from these incentive schemes in 2010. including Romania. transport. which can support new investment and job creation.Incentives for investors The government offers a number of investment incentives to attract FDI. Government incentives to support economic growth The main conditions upon which state aid is granted are: initial investment volume (EUR million) and number of new jobs created: Initial investment ranges (EUR million) 5-10 10-20 20-30 Over 30 Number of new jobs created 50 100 200 300 The government grant scheme is available for five years (2009-2013) and consists of grants of up to 50% of the eligible costs of the investment. investors need to be aware of a number of challenges that are common to most transition economies in the region. Nevertheless.000 people. with eligible costs of over EUR 50 million (RON equivalent) if they create at least 500 new jobs. Pirelli. except the primary production of agricultural products. from both national and EU sources. maritime shipbuilding and synthetic fibers. In this respect. . The level of aid is calculated by adjusting the regional ceiling to the eligible expenses. Renault. fisheries. the coal industry. All fields of activity are eligible.

Employment incentives Employers who hire recent graduates may apply for a monthly grant. This is calculated by multiplying the reference social indicator (currently RON 500) by 1.25 bn for the period 2007 – 2013.5 for each new graduate (depending on the education level of the employees). the monthly grants as well as the exemption from the contribution to the unemployment fund are offered for 18 months. which has been granted EUR 360. The most attractive and accessible funds for SSC/ BPO entities relate to investments in human capital development. In this case. available at national and public level as well as at private level. beneficiaries including HP Global E-Business Operations. benefit from a monthly incentive of 50% of the reference social indicator for each student/scholar. in this respect. . for a period of 12 months.Romania as the destination for SSC and BPO | 11 Incentives related to European Union funding Following accession to the EU. Additional incentives are granted for the employment of recent graduates with disabilities. the BPO arm of HP in Romania. Employment incentives are also granted to companies which hire unemployed persons aged over 45. Employers are also exempt for the same period from paying the unemployment contribution due for the amounts paid to these graduates. total funds available for Romania amounting to EUR 4. The incentive is granted for a maximum of 60 days. . A multitude of private and public institutions have benefited from such funds.000 via such programs. The Romanian authorities recognize the importance of the IT sector and. Romania has gained access to a significant pool of EU funded grants. IT specialists have been exempt from salary tax since 2001. The employment relationship must be maintained for at least two years. In addition.2 1. companies hiring scholars and students during summer vacations. Employers receive a monthly grant equal to the reference social indicator for each such person and are also exempt from paying the unemployment contribution due for the amounts paid to them. as well as for employment of an individual who is the sole supporter of their family. This incentive is available indefinitely and aims to retain workers with high level IT expertise in Romania.

„ Accelerated depreciation According to Romanian fiscal legislation. even if they do not qualify for the fiscal incentive in relation to R&D costs. etc. for the same purposes as the above mentioned ones. „ Tax incentives for reinvested dividends Dividends reinvested for the purpose of creating new work places or for the purpose of developing the activities of Romanian legal entities distributing their dividends. „ Local tax exemptions Buildings and land used within hydroelectric. Other fiscal incentives are provided for renewable energy producers. as well as buildings and land related to transformation and connection posts are exempt from local taxes. Consequently. thermoelectric and nuclear power plants. Local councils may grant building or local tax exemptions to legal entities which benefit from state aid schemes. computers and their peripherals. such as exemption from excise duties for energy produced from renewable sources. are dividend tax exempt. • For taxpayers to be able to take advantage of these incentives. while the rest of the asset’s value can be depreciated using the linear method over the remaining useful life. building and land used within industrial parks are exempt from building and land tax.12 | Romania as the destination for SSC and BPO Tax incentives „ Research and development Romanian legislation provides for two main tax incentives for Research and Development (R&D) costs: • 20% additional tax deduction for all eligible R&D costs (e. In addition. they must conduct R&D activities which generate an outcome that can be used by the taxpayer for its own benefit in order to increase revenues. consumables incurred in R&D activity. Under this depreciation method. In addition.). accelerated depreciation can be used by companies for machinery and equipment. Accelerated depreciation for equipment used in R&D activity. taxpayers may apply accelerated depreciation to fixed assets which fall within the above mentioned categories.g. depreciation of intangible assets used in R&D activity. operating expenses such as raw materials. a maximum of 50% of the asset’s fiscal value may be deducted during the first year of usage. are also dividend tax exempt. dividends reinvested in the share capital of another Romanian legal entity. . salary expenses in relation to staff involved in R&D activity.

Romania: an attractive SSC and BPO Destination Shared Service Centers (SSC) and Business Process Outsourcing (BPO) are the cornerstone of today’s strategies for corporations around the world. although the pressure of cost-cutting across functions and geographies is still on. In terms of expectations. as globalization and new technologies have led to the proliferation of SSC/ BPO entities beyond their traditional frontiers. . Furthermore. scale and lower operating costs. challenging their SSC/ BPO units to deliver similar operational and financial performance to that of their mother companies. tele-sales. Studies show that early adopters of SSCs and BPO have already pocketed benefits of 20 – 30% or more. handling a more diverse range of services: legal services. Recent trends also show that single-function SSC/ BPO entities are gradually shifting to multi-function organizations to increase scale. new industries are being added to the SSC/ BPO universe.Investment in Romania | 13 2. SSC and BPO providers are expanding and becoming more sophisticated in their approach. SSC/ BPO activities have also gained in scope. as a result of increased efficiency. A different category is made up of companies which have initially set up SSC/ BPO entities in well-established economies and are now considering moving them to lower cost locations. companies are not only looking to cut costs. finance and supply chain processes. which have the potential of offering comparative service quality and safe business environments. as their SSC/ BPO organization matures. real estate management. spare parts management. In addition to the traditional IT. such as the public sector and the healthcare industry. marketing intelligence and knowledge management. Those which have not acted yet are increasingly contemplating intensifying their cost cutting activities by moving operations off-shore or near-shore. They also push for innovation and enhanced services. Locations are no longer limited to the areas the organization resides in. warranty management.

86 0.76 2. while the business culture is steadily aligning to the standards imposed by the wellestablished economies. 2011 .38 0.2 5.81 0. Kearney Global Services Location Index.05 1.11 4.45 2.12 2.24 1.82 2.47 5. either in the form of setting-up and expanding shared service centers.81 1. new locations are getting a seat at the global services table. the cultural compatibility and the business environment are backed up by financial attractiveness of Romania. extracted from the Global Service List A.02 1.65 2. These three characteristics are decisive when choosing a location.06 2. or by outsourcing particular activities to local BPO entities.T.27 1.54 0.88 2. Various studies place Romania among the top 5 European destinations for all types of global services activities. their availability. Rank* 2011 Country Financial Attractiveness People skills and availability Business environment Total score 1 2 3 4 5 6 7 8 9 10 Notes: Source: Baltic Countries** Bulgaria Poland Romania Germany Hungary Czech Republic Ukraine Spain France 2.95 4. The provision of global services continues to be an attractive business proposition for companies investing in Romania.03 1.75 4.03 2. People skills.21 5. with companies such as Microsoft and Oracle entering the IT outsourcing market as early as 15 years ago. Romania has emerged as a top European destination.07 2.98 4.14 | Romania as the destination for SSC and BPO As SSC/ BPO locations become more and more popular and competition for skilled labor intensifies.07 1.82 2.81 2.27 1. Compared to other Central and Eastern European countries.23 5.88 1.94 0.17 1.67 1.14 1.14 2. their language proficiency.61 * Rank within European countries only. Romania has historically excelled in providing highly skilled IT and engineering specialists.37 5.11 5.

wall-street. resulting in increased mobility for employees. labor force availability Main SSC / BPO companies in Romania Source: Companies’ websites.T.Romania as the destination for SSC and BPO | 15 The key factors that contributed to A. government support for the IT/ BPO sector. providing a steady. and increased guarantees of political stability. The overall Romanian IT market has continued to show signs of growth. provide a competitive edge to the Romanian work force. German and Russian. with a +44% increase in IT Outsourcing services provided in 2009 compared to 2008. an increase of cca 7% compared to the 2009 level (www. languages. accompanied by increased deployment of Quality Management systems. as visas are not required within the EU. Romania is a member of the European Union and of NATO. Siemens and Alcatel are constantly expanding their scope of services in Romania. inexpensive and qualitative flow of skilled resources to meet the growing demand of SSC/ BPO entities. capitalizing on the solid education system.ro) . Hungarian. There is a general opinion that the hottest areas are the financial sector and the public sector. Therefore. ratings of main management and IT institutes.org). which is as high as 97%. Despite a large range of SSC/ BPO entities active in Romania.ro). quality of infrastructure and security of intellectual property Romania is an ideal near-shore location. there is still tremendous potential for growth in this sector. limiting themselves to single-function units. opening new centers and taking on additional tasks. The key trend that has contributed to this accelerated evolution is the growth of both IT services and IT infrastructure support.ceeoa.anis. covering English. Most companies that entered the market initially have approached it with caution. local media • Business environment: investors/ analyst ratings of the business and political environment. A study conducted by the Central and Eastern European Outsourcing Association shows that Romania has consistently been the fastest growing market within the CEE Region. Cultural compatibility and a large scale of foreign language skills. infrastructure and tax & regulatory costs • People skills and availability: SSC/ BPO experience. companies such as Continental. the Software and IT services volume in 2010 reached EUR 704 million. despite tough economic conditions. Spanish. Kearney’s assessment of Romania’s attractiveness for the global services sector include: • Financial attractiveness: compensation. Renault. with the potential of adding new services as their Romanian entity matures. Romania’s outsourcing focus is reinforced by the share of IT outsourcing services within the total IT market. (Source: www. As SSCs and BPO are continuously evolving. Early entrants have set up their SSC/ BPO units mostly as greenfield investments. (Source: www. Italian. French. but there are a few companies that entered the Romanian market through acquisition of local companies.

16 | Romania as the destination for SSC and BPO 3. WIPRO (Finance & Accounting and IT Services covering the Eastern European market). and in some cases as the home of a broader management. logistics. Numerous companies have set up headquarters in Bucharest. P&G. providing a wide range of financial. collections.co.300. 2. at purchasing power parity. capitalizing on the wide availability of highly qualified workers and proximity to already established headquarters of many companies. customer relationship and human capital management SSC and BPO for customer support and IT services for EMEA SSC for procurement covering EMEA region SSC for Finance & Accounting. the capital of Romania. It is also a more attractive choice for the expat community (international schools. Bulgaria and other countries in the CEE region. S&T.cnp. Procter & Gamble. aimed at both local customers as well as regional ones: Genpact (financial services. with an important IT services market segment. Petrom etc. on the banks of the Dambovita River. Bucharest’s services industry has attracted most of the multinational companies operating in the area.ro (National Commission for Prognosis) .romaniatourism. commerce. Wipro. WNS Global Services (Finance & Accounting and customer support services.000 companies. services.romaniatourism. The capital is used as a national operations center by some. BPO for financial. attracted by the highly skilled labor force and low operating costs. or 45% that of the European Union average and more than twice the Romanian average.200.000 Food and beverage production. IBM. HP Oracle. while being inhabited by only 10% of the country’s population. Accenture (outsourcing of various process). The list includes multinationals such as Microsoft. logistic and administrative business processes SSC for procurement. promotion and sampling activities). GE. including a significant number of headquarters of companies operating at a CEE level (Bucharest serves as a hub for the Balkans operations for many international companies. delivery center for global clients). Source: www. such as Michelin.cnp. . etc). procurement and delivery services). Bucharest’s economy is mainly focused on industry and services. offering a full range of SSC/BPO services. Source: www. some of world’s most reputable BPO companies carry out activities in Romania. IT. Bucharest has consistently been the preferred SSC destination in Romania. Romania has been one of the fastest growing IT markets in Europe. Company name HP (Global E-Business Operations Center) IBM GDC/ GPSG Main services offered SSC and BPO for EMEA region. Oracle EMEA (IT services and customer support). Microsoft (GTSC) Procter & Gamble GBS Global Procurement Center Petrom (part of OMV Group) Siemens IT Solutions and Services PSE RO Huawei Location Situated in the south of the country.ro (National Commission for Prognosis) In addition. as well as national companies such as UTI Systems. Business Ideas Provider Group (merchandising. www. accounts for around 23% of the country’s GDP and about one-quarter of its industrial production. S&T (Customer support and IT related services). IT Population SSC for Research & Development and IT SSC for Finance & Accounting Major industries City introduction Bucharest. It houses 186. www. access to international flights etc). In 2010. wide range of private healthcare services. For the past 6 years. Roche. which often includes the Republic of Moldova. Main cities in Romania Bucharest SSC/BPO setting Among main Romanian cities.co. Bucharest had a per-capita GDP of EUR 14.

Average net wage: EUR 450 Languages spoken: Romanian. trolleybuses and a subway network.000 square kilometer area. Source: http://www4. Therefore. Romania has a fairly extensive railway system. Source: http://www4.pmb. Traffic congestion occurs.cnp.000 Employees: 890.ro/en/market-overview/article.doingbusiness. „ Upcoming projects At the heart of the national economy.ro/wwwt/l52/docs/31_01_2008. German. The city is linked to the rest of the country mostly by main roads.ro/wwwt/l52/docs/31_01_2008. registering 30 billion EUR in foreign investment up to 2010 and representing cca two thirds of national direct foreign investment. Romtelecom. Plans have been made for an extension of the city’s metro system over the next few years. „ „ „ „ „ Source: www. offering a large talent pool.5/sqm (suburban) to EUR 18.5/sqm (center). English. with 16 public and 18 private institutes.pdf There is a high availability of office space. following the delivery of newly built space and shrinking demand. Mobile telephony and Internet services are relatively inexpensive and of higher quality compared to other CEE countries.insse. EU accession prompted more investment in the capital city. ecological waste depots and waste water treatment stations. create new subway lines and improve the telecommunications. Bucharest has been in a state of constant change in recent years. still lower than its peer CEE cities. extending to the Danube river.pdf Bucharest has the highest cost of living indicators in Romania. There are plans to create a Bucharest Metropolitan Area. „ People mobility The local administration has introduced multi-annual planning to ease traffic. French. transit and business infrastructure.ro (National Institute of Statistics). prime office rents in 2011 have ranged from EUR 11. with vacancy rates at 19% as of 2010. has a strong presence covering telecommunication services. the highest of all Romanian cities.Romania as the destination for SSC and BPO | 17 Human resources „ Institutes of Higher Education: largest Romanian academic center and one of the most important centers in Eastern Europe. speeding its development. further expanding opportunities. New projects include flyovers. particularly during rush hours. „ Telecom Infrastructure Full scale telecommunication services are available in Bucharest. Several companies offer Internet services. Spanish. „ Ease of commuting The city has a reasonably developed transportation network including trams. expansion of the main train station. mobile (through Cosmote).pdf Quality of life „ Cost of living Bucharest has two international airports: Henri Coanda (close to the city) and Aurel Vlaicu (within the city) . The city offers an inexpensive labor force and lower administration costs than in other European countries. .pmb. Italian. as well as a limited motorway network.000 Unemployment rate: 2. which is currently being extended. fixed (via its own lines) and Internet. ranging from fixed lines to cellular phones and high speed Internet lines.3%. www. Bucharest is the economic center of the country. The main telecom operators in the region are Orange. Number of students: 300. for example various road building projects. but various projects are under way to ease this. Plans are under way to upgrade the country’s road and rail networks to bring them up to European standards.ro (National Commission for Prognosis) Infrastructure „ Office space • Source: http://arisinvest. modernization of the airport and the construction of a new one nearby Bucharest. Source: php?articleid=479 http://realestate. • • Key drivers for the city to emerge as a favourable SSC/BPO destination • Bucharest is the main university center of the country. which would include 94 cities and villages spread across a 5. buses. Vodafone and Cosmote for mobile services and Romtelecom for landline telephony.ro/files/whyromania/ISD%202008. The net average salary is EUR 450. the former national telecom company. Steps are being taken to improve the city’s infrastructure. Several projects are under way to improve the city’s infrastructure.

as it is a highly appreciated economic. for a wide range of financial. IT. finance and accounting. pharmaceuticals. food processing. Company name HP Global E-Business Operations Center Genpact Evalueserve Office Depot Bombardier Transportation Emerson Main services offered SSC and BPO for EMEA region. City introduction Cluj-Napoca. engineering services. order management. It is the largest and most important city in the Transylvania region. textiles. approximately 50 minutes by air from Bucharest. the capital city of the Cluj county.000. wood processing.18 | Romania as the destination for SSC and BPO Cluj-Napoca SSC/BPO setting Cluj Napoca has historically been a preferred location for SSC/ BPO entities. financial services. Ziarul Financiar Source: National Institute of Statistics – Romania. Population Major industries Source: Company websites. collections. academic. software development and IT services. due to its highly skilled workforce. logistic and administrative business processes BPO for Finance & Accounting. has historically been one of Romania’s major academic. cultural and commercial hubs. 330. with a dynamic social and cultural life and a large number of investors. procurement and delivery services BPO for IT services SSC for Finance & Accounting SSC for Administrative Services SSC for Engineering services Location Situated in North Western Transylvania in the valley of the Somesul Mic river. Eurostat . excellent living conditions and good connections with the rest of the country and to main European cities. The SSC/BPO services offered include research and data analytics. Cluj Napoca is viewed as the best Transylvanian city to live in. social and cultural center for the area.

has a strong presence covering telecommunication services. This is the result of a large amount of foreign investment which has led to higher than the average monthly salary levels (EUR 350 net) and GDP per capita (EUR 7 .manager.625). mobile (through Cosmote). Average salaries are lower than in Bucharest.000 Unemployment rate: 3. Germany. Cluj-Napoca International airport. Source: http://www. the UK.ro/articol_23256/ unde_e_bine_sa_traiesti_in_romania__harta_nivelului_de_trai. especially English. . German. but higher than the country average (EUR 340 net).Romania as the destination for SSC and BPO | 19 Human resources „ „ „ „ „ „ Institutes of Higher Education: 50 public and private institutes.000 Employees: 180.sfin. fixed (via its own lines) and Internet.7 % Average net wage: EUR 350 Languages spoken: Romanian. Infrastructure „ Office space • There has been a recent excess supply of office space. Hungarian.ro/files/whyromania/ISD%202008. Italy. French and Italian.000 sq meters business center in the city center.ro/articole/analize/analiza:-piata-de-spatii-comercialesi-birouri-din-romania--10469. Number of students: 60. Italian. buses and trolleybuses. • Key drivers for the city to emerge as a favourable SSC/BPO destination • Cluj-Napoca is an important IT and financial hub in Romania. due to increasing competition for talent in Bucharest. Several companies offer Internet services. Romtelecom. The main telecom operators in the region are Orange.html Source: http://arisinvest. There is no underground public transport. French. „ People mobility The city is to be linked with Bucharest and the Hungarian border by Autostrada Transilvania (Romanian Motorway A3). Spanish. and suited to provide multi-lingual services. including a construction of a 10. The city is being considered as an alternative outsourcing location to Bucharest. English. Several real estate projects are being developed in Cluj-Napoca. offers direct flights to Timisoara and Bucharest in Romania as well as various destinations across Europe including France.html?action=print „ Ease of commuting The city has a transportation network including tram lines. which is the third largest airport in Romania. Source: INS (National Institute for Statistics)http://www. The talent pool is skilled in many languages. Quality of life „ Cost of living The city has a well developed rail and road network and it is crossed by the E60 European Road. German. the former national telecom company. Vodafone and Cosmote for mobile services and Romtelecom for landline telephony. Austria and Spain. Mobile telephony and Internet services are relatively inexpensive and of higher quality compared to other CEE countries. However roads are congested during rush hours.pdf „ Telecom Infrastructure „ Upcoming projects Full scale telecommunication services are available in ClujNapoca. Average rent is cca EUR 9 per sqm. The 415 km highway is estimated to be completed in 2013. ranging from fixed lines to cellular phones and high speed Internet lines. High salaries and low prices mean that Cluj takes third place in the league table of the best cities to live in Romania.

In recent years. Eurostat. The IT&C sector is one of the most dynamic in Timisoara. Timisoara has registered a significant economic boom.php?option=com_content&task=view&id=3&lang=romanian City introduction Timisoara is the fourth largest Romanian city and the main economic and cultural center of the Banat region in the west of the country. based on a project managed by the City of Timisoara in cooperation with the Regional Development Agency. The major interest is in data security. Population SSC for engineering services SSC for Human Resources. logistic and administrative business processes BPO for IT. Source: http://www.ro/monitorul/index. Research and Development. agriculture.000 IT.itcongress.primariatm. A new IT&C center is planned. textiles. near the border with Hungary and Serbia. especially in high-tech sectors. there have been major investments in new software and hardware solutions that could allow companies cut costs. as well as from the USA. primarily Hungarians. database management.20 | Romania as the destination for SSC and BPO Timisoara SSC/BPO setting Many leading companies are currently active in Timisoara. which will host a series of IT companies. IT solutions for end users have also attracted important international IT players. registering substantial growth in the last 10 years. In the regional IT business environment. Some of the most substantial investments have been from the European Union. Company name HP Romania Timisoara WIPRO Timisoara Bosch Communications Center Siemens VDO Automotive Alcatel Lucent S&T Romania Continental Automotive Oracle Source: Companies’ websites Main services offered SSC and BPO for EMEA region. It is a multicultural city with influential minorities. and Serbs. software integration and consultancy.ro/uploads/files/ concept/starea_economica. Research and Development BPO for customer support and IT related services SSC for Finance & Accounting.ro/index.primariatm. Procurement Services covering the Eastern European market BPO for telemarketing services Location Located in the west of the country. http:// www.php?meniuId=1&viewCat=12&viewItem=3747 . 322. software production. especially from Germany and Italy. machinery. business continuity and system back-up. Services offered on the local market include process outsourcing. based mainly on foreign investment. Technical services and Procurement BPO for IT services and customer support Major industries Source: National Institute of Statistics – Romania. Finance & Accounting. while clients range from the automotive industry to services. for a wide range of financial. Germans. including some of the most important global players on the SSC/BPO market.http://www.pdf .

000 Employees: 195. technological and research parks were developed and supported by a financial incentive plan. and this presents several advantages: foreign language literacy. there is high foreign language literacy: Languages spoken include Romanian. in spite of the high prices for basic products. situated within built-to-suit buildings.html „ Ease of commuting Timisoara has a reasonably developed public transportation network including buses.ro/articol/cat-costa-viata-in-marile-orase-dinromania-23050. the office space market is still developing.pdf „ Telecom Infrastructure „ Upcoming projects Full scale telecommunication services are available in Timisoara. mobile (through Cosmote). Source: http://realestate.Romania as the destination for SSC and BPO | 21 Human resources „ „ „ „ „ „ Institutes of Higher Education: 45 public and private institutes.com/Timis_pe_locul_doi_dupa_Capitala_la_nivelul_de_ trai-272180. English. and an innovative culture. railways and one of the largest airports in the country. Improving the transport infrastructure. The west side of the country benefits from the most significant investments in infrastructure being located on the PanEuropean 6th corridor (Timisoara. Serbian. There are no major congestion issues in the city and a strategic plan for public transportation improvement has been implemented by local authorities. Italian and Spanish. Number of students: 42. Infrastructure „ Office space • In Timisoara. can be rented out at prices as low as 7 – 12 EUR/sqm/month. telecom and IT industries. Several companies offer Internet services. French.ro/uploads/files/concept/starea_economica. „ People mobility Timisoara’s local administration has initiated a development program to support companies in the software. Proximity to Western Europe: Timisoara is close to the border with Hungary. Salaries are above country average and the number of employees exceeds the number of retired. ranging from fixed lines to cellular phones and high speed Internet lines. The main telecom operators in the region are Orange. the former national telecom company. Source: Statutul Municipiului Timisoara. Vodafone and Cosmote for mobile services and Romtelecom for landline telephony. trams and trolleybuses. The county is considered to be one of the richest in Romania because of its high GDP (EUR 8. fixed (via its own lines) and Internet. which operates both international and domestic flights. Key drivers for the city to emerge as a favourable SSC/BPO destination • • Timisoara is one of Romania’s most important university centers. Spaces with Class A facilities.Arad highway was finished in December 2011). due to the increasing number of investors. Industrial. Mobile telephony and Internet services are relatively inexpensive and of higher quality compared to other CEE countries.ro/en/article. Hungarian.000 Unemployment rate: 2.doingbusiness.pdf .html .ziare. Source: http://www. German. Local administration support for the IT&C market through “software companies’ incubators” offering start-up companies . http://www. proven by its tradition of being the first Romanian city to implement several technological breakthroughs. Traian Vuia. at the same time encouraging new companies to take on more qualified workers.primariatm. Romtelecom.php?articleid=165&page=1 Source: http://arisinvest. Timis is one of the counties where.ro/files/whyromania/ISD%202008. etc. There is no underground public transport. incentives.capital.6 % Average net wage: EUR 340 Languages spoken: Due to the proximity to Western Europe. has a strong presence covering telecommunication services. Quality of life „ Cost of living The Timisoara region is well connected to other important cities in Romania by national and express roads. Source: http://www. quick access to a wide network of road and train transportation routes providing connections to most EU countries.218 per capita). while the unemployment rate is under control. services and production industries are priorities for the local authorities in an effort to promote Timisoara as an economic hub for the region and the DKMT Euroregion. the cost of living is still lower that in the rest of the country.

http:// www.php?meniuId=1&viewCat=12&viewItem=3747 . capitalizing on a strong education system with high emphasis on foreign languages. food. In particular. Brasov offers many advantages for new investors in the people intensive industries. Companies’ websites Located in the central part of Romania.22 | Romania as the destination for SSC and BPO Brasov SSC/BPO setting Brasov emerged as a favourable SSC/BPO destination as an alternative location to Bucharest or as an additional location for companies that already have set headquarters in Bucharest.php?option=com_content&task=view&id=3&lang=romanian City introduction Brasov lies in central part of Romania and it is the capital of Brasov County. which manufactures MAN AG trucks under license. Brasov is still a site for industrial activity. It is surrounded by the Southern Carpathians. logistic and administrative business processes SSC for Research & Development BPO for IT services BPO for IT services BPO for IT services and call centers Location Source: www. Machinery. textile. pharmaceuticals. There are also chocolate factories and a large brewery. with GlaxoSmithKline establishing a production site in Brasov.itcongress.ro/monitorul/index.000. (CGS) Main services offered SSC and BPO for EMEA region. and it is part of the Transylvania region.ro. Source: http://www.ro/index. 232. www. 166 km from Bucharest. Company name IBM GDC Siemens IT PSE Brasov DCI Database for Commerce and Industry Romania Wind Technologies Computer Generated Solutions. Inc. The economy of Brasov is complex. the pharmaceutical industry has undergone further development lately. with a strong industrial character. Mediafax.curierulnational. Population Major industries Source: National Institute of Statistics – Romania. Eurostat . including the Roman truck factory.ro. Although the industrial base has been in decline in recent years. for a wide range of financial.bursa. Heavy industry is abundant.primariatm. While continuing to be a highly industrial city.

the former national telecom company. as there is a lack of class A office spaces and the vacancy rate is low. There is no underground public transport. „ People mobility The National Institute of Statistics concludes that. Several companies offer Internet services. German. Spanish. Serbian.000 Employees: 140.000 Unemployment rate: 5. An airport is currently under construction and is due to open in 2012. Romtelecom. • Key drivers for the city to emerge as a favourable SSC/BPO destination • The city is considered a good alternative location for multinational companies with head offices in Bucharest. and Internet. They are contemplating setting up a Business Incubator to give advice to new small and medium businesses.5 % Average net wage: EUR 330 Languages spoken: Romanian.brasov. Source:http://www. ranging from fixed lines to cellular phones and high speed Internet lines. The construction of an international airport is underway thus making the city more accessible. fixed (via its own lines). The local authorities plan a project to improve the quality of life and the working conditions for the labor force. at an average of EUR 330 (net). Quality of life „ Cost of living Full scale telecommunication services are available in Brasov. The main telecom operators in the region are Orange.English. along with the development of the two national roads that link Brasov with Ghimbav and Cristian.ro/articol_19313/ce_chirii_platim_pentru_birouri_in_ principalele_orase_din_tara. Source: http://www. Source: ratbv. has a strong presence covering telecommunication services. due to the lower than the average cost of living. Eurisko – Doing Business „ Upcoming projects „ Telecom Infrastructure A model for the planning of industrial estates is being devised. Vodafone and Cosmote for mobile services and Romtelecom for landline telephony. German). French. Brasov is an important university center. The lines connecting the northern regions to the southern regions and the western regions to the Eastern regions cross in Brasov’s rail hub.the Comarnic-Brasov segment will be ready by 2014. Salaries are lower than in other large Romanian cities.ro . Highways linking Bucharest (connecting it to the port of Constanta) and the Hungarian border are under construction. Rent levels are in the range of 8-10 EUR/sqm. The city is crossed by European Road 60. Brasov has an integrated system of above-ground public transport. • • In Brasov county there is high emphasis on bilingual teaching (English. the quality of life in Brasov is above the national average. with 23 bus routes covering over 400 km.sfin. The Transylvania A3 highway is under construction. French. Infrastructure „ Office space Brasov’s office space market is relatively underdeveloped. Number of students: 25. There are also high school classes allocated for German and Hungarian based teaching.Romania as the destination for SSC and BPO | 23 Human resources „ „ „ „ „ „ Institutes of Higher Education: 6 public and private institutes.ro/articles/view/406 „ Ease of commuting Brasov has well developed rail links for both national and international transit. Hungarian. Mobile telephony and Internet services are relatively inexpensive and of higher quality compared to other CEE countries. mobile (through Cosmote). 6 trolleybus routes covering over 175 km and 12 minibus routes covering 115 km.

customer services and telemarketing SSC for Research & Development SSC for software development SSC for Finance & Accounting and Human Resources Location Located in the north-east of Romania.On Servicii Main services offered BPO for IT services BPO for IT. Population Major industries Source: http://www.php?meniuId=1&viewCat=12&viewItem=3747 . cultural and academic centre of the Romanian region of Moldavia.itcongress. http:// www.primariatm. and it is the economic.ro/index.ro/monitorul/index. Oracle. close to the border with the Republic of Moldova.ro/economic/industria-fara-fum-de-la-iasi~ni42sa Source: National Institute of Statistics – Romania. Eurostat . Pharmaceuticals. confirming both its potential and the local workforce’s qualifications. petrochemicals. 315. in the north-east of the country. Company name Ness Romania XL World Continental Automotive Amazon Development Center E. Pentalog and Synergy.php?option=com_content&task=view&id=3&lang=romanian City introduction Iasi is one of the largest Romanian city according to its population. textiles.24 | Romania as the destination for SSC and BPO Iasi SSC/BPO setting A significant number of leading companies perceive Iasi as a developing IT and services market and the city has already become a business environment for companies such as Siemens.000.ziaruldeiasi. Source: http://www.

which will ease commuting and/or access to suburban facilities. The main telecom operators in the region are Orange. Socio-economic development strategy.5 % Average net wage: EUR 315 Languages spoken: Romanian. German. Source: http://realestate. French.via its own lines. there are many opportunities for development and expansion. ranging from fixed lines to cellular phones and high speed Internet lines. Romtelecom.900 Unemployment rate: 5. and Romtelecom for landline telephony.000 Employees: 156. Mobile telephony and Internet services are relatively inexpensive and of higher quality compared to other CEE countries. Eurisko – Doing Business Infrastructure „ Office space „ Upcoming projects There is an adequate supply of modern office space. railways and an airport. mobile. Budapest and Vienna (which offer a wide range of onward connections). through Cosmote. Number of students: 58. Source: Municipality of Iasi. There is no underground public transport. For the past 3 years. Socio-economic development strategy. but plans are in place for development. Timisoara. A city belt is planned. National Institute of Statistics. „ People mobility Quality of life „ Cost of living The average net salary in Iasi is EUR 315. the former national telecom company. fixed . the cost of living has increased consistently. Source: Municipality of Iasi. Strategia de dezvoltare economico-sociala durabila a Municipiului Iasi The Iasi region has an adequate road and railway network which facilitates commuting. emphasizing the importance of IT services in their mid and long term development strategy. prime office rental rates range from EUR 7 to EUR 12 per sqm. Buses and trams are available for in-city transportation. Source:http://www. while the airport has direct flights to Bucharest. Source: Family Budget Inquiry. . local media „ Ease of commuting Iasi is linked with other parts of Romania and abroad through roads. Currently. Several companies offer Internet services.ro/articol_19313/ce_chirii_platim_pentru_birouri_in_ principalele_orase_din_tara. Russian.doingbusiness. Several international bus companies offer daily road transportation to major European capitals. Strategia de dezvoltare economico-sociala durabila a Municipiului Iasi Full scale telecommunication services are available in Iasi. Highways are not available in the region.sfin.Romania as the destination for SSC and BPO | 25 Human resources „ „ „ „ „ „ Institutes of Higher Education: 10 public and private institutes.ro/ro/article. Vodafone and Cosmote for mobile services. English. Lower workforce costs than in Bucharest and a high rate of qualified personnel. has a strong presence covering telecommunication services. and Internet. Taking into consideration the city’s size and the economic role it plays in the north-eastern part of Romania.php?articleid=187 „ Telecom Infrastructure Iasi’s local administration plans to develop the IT&C industry and services (placing IT&C companies in the center of the city). Key drivers for the city to emerge as a favourable SSC/BPO destination • • Iasi is a major regional economic center and a traditional university center.

southeast Romania. Agriculture. tourism. It is an important university center and the administrative capital of the southeast development region. Traditionally a port city.000. Eurostat . hosting strong economic activity. Constanta now presents opportunities rather than a previously established market. while the port spreads across 39. Located on the Black Sea coast. the city has a beach length of 13 kilometers. food and beverage processing. 298.26 square km. Location On the Black Sea coast. Constanta can harbor an IT services market. Population Major industries Source:National Institute of Statistics – Romania. chemicals and petrochemicals.26 | Romania as the destination for SSC and BPO Constanta City introduction Constanta is one of the major cities in Romania and home to the fourth largest port in Europe. A transportation node with both national and international destinations.

and Internet. major roads (express and national) linking the county to other major cities.wordpress. There is no underground public transport.topestate. „ People mobility The cost of living is lower than the average. .html „ Ease of commuting Local bus companies provide links to most of the near by area. Constanta City Hall (http://www. Ministry of Education Infrastructure „ Office space „ Upcoming projects The office space market is yet to settle in Constanta. Main telecom operators in the region are Orange. linking road. German. Source: http://www. Growing economy and lower developing costs than Bucharest Source: National Institute of Statistic. Turkish.000 Unemployment rate: 4. Number of students: 14. as the availability of office space is limited. associated with an important university center. buses and trolleybuses provide in-city transportation. Source: http://imobiliare. • Key drivers for the city to emerge as a favourable SSC/BPO destination • Constanta is one of largest cities in Romania.ro/ The local administration has developed a longterm strategy to increase the competitivity of the industrial production sector. Several companies offer Internet services. Mobile telephony and Internet services are relatively inexpensive and of higher quality compared to other CEE countries.ro/PrimariaConstanta/Proiecte/AL21Rom. English.com/2011/06/06/dezvoltareainfrastructurii-ar-putea-plasa-portul-constanta-pe-locul-2-in-europa/. Source: (http://transporturiferoviare. in addition to railway services. Turkey.1% Average net wage: EUR 360 Languages spoken: Romanian. air.pdf) „ Telecom Infrastructure Quality of life „ Cost of living Full scale telecommunication services are available in Constanta. Constanta is a major hub. rail infrastructure able to manage both passengers and freight. There is a highway to Bucharest. fixed (via its own lines). build up the tourism industry and improve the transport infrastructure.primaria-constanta. linking Constanta to Istanbul.000 Employees: 181. French. ranging from fixed lines to cellular phones and high speed Internet lines. sea connections to other world ports and a river connection to Danube riverside countries. but the inflow of tourists over the summer may inflate prices temporarily. Vodafone and Cosmote for mobile services and Romtelecom for landline telephony. has a strong presence covering telecommunication services. A commercial ferry line was opened in 2011. the former national telecom company. mobile (through Cosmote).Romania as the destination for SSC and BPO | 27 Human resources „ „ „ „ „ „ Institutes of Higher Education: 3 public and private institutes. office building rent prices range between EUR 5 to EUR 10 per sqm.sfin.ro/articol_23256/unde_e_bine_sa_traiesti_in_romania__ harta_nivelului_de_trai. railway. Romtelecom. sea and river transportation. Trams. In 2011.

php?option=com_content&view=arti cle&id=102&Itemid=236&lang=en.ro/index. the Transylvania Center of Excellence in Research. favored by the abundance of timber in Mures County. http://www. with Azomures SA as the leading chemical fertilizer producer in Romania. (“Digital Mures”). The pharmaceutical industry has registered significant growth.cciams.ro/topul_firmelor/clasamente_j. The wood processing and exploitation industry is one of the most representative. accounts for a third of the total local revenues. dairy and cheese). wood processing Population Major industries Source:National Institute of Statistics – Romania www.php/Local-Transport/111/1/ . at approximately equal distances from border crossing points. due to the E. Company name E.mures. chemicals. Sandoz).000 Pharmaceuticals. tirgumures. German and English).html#domtop2 Location Located in central Romania. 231. Other prolific industries in the city are: food (milk. electronics and optical equipment.ro/ category. ready-made clothing.ON group. as pharma multinationals have set up local production facilities in Targu Mures (Gedeon Richter. The utilities industry.28 | Romania as the destination for SSC and BPO Targu . Source:http://www. although represented by a small number of economic operators. food.Mures SSC/BPO setting With a strong educational system. In April 2011 the Romanian Government and IBM announced their intention to begin discussions on the establishment in Targu Mures of a research collaboration center. leather and footwear.ON Servicii Main services offered SSC for Finance & Accounting and Human Resources City introduction Targu Mures is the capital of Mures County and the city with the largest ethnic Hungarian population in the country. Hungarian. one of the most diverse in terms of foreign language-based education (Romanian. Targu Mures has enormous unexplored potential. electrical. The chemical sector is also a key contributor to the Targu Mures economy. textiles.

Several companies offer Internet services. Mobile telephony and Internet services are relatively inexpensive and of higher quality compared to other CEE countries. has a strong presence covering telecommunication services. Targu-Mures represents a rail.3% Average net wage: EUR 290 Languages spoken: Romanian. Vodafone and Cosmote for mobile services and Romtelecom for landline telephony. The transportation network assures multiple connections to Road E60 that ties Western Europe to Eastern Europe.000 Unemployment rate: 6. The development of project worth EUR Quality of life „ Cost of living Mures county has average living conditions. created to help the city to become a regional axis of scientific research and progress. “Digital Mures” is underway.php?id=388) Infrastructure „ Office space Low availability of Class A offices. mobile (through Cosmote).ro/main. and its graduates have an excellent working knowledge of English. with . German.ro/articol_23256/unde_e_bine_sa_traiesti_in_romania__ harta_nivelului_de_trai. ranging from fixed lines to cellular phones and high speed Internet lines.Romania as the destination for SSC and BPO | 29 Human resources „ „ „ „ „ „ Institutes of Higher Education: 5 public and private institutes. French. with a GDP per capita of EUR 4. Source: http://www. „ People mobility Situated in the center of Romania. Full scale telecommunication services are available. . A project sponsored by the City of Targu Mures. and Internet. Hungarian. Main telecom operators in the region are Orange. the aim of setting up a modern infrastructure of private-public services and to foster the construction and development of a technological park specializing in research and medical information.html?action=print „ Ease of commuting The city has a transportation network including tram lines and buses.sfin. The initiative follows the municipality’s “Digital Mures” strategy. „ Telecom Infrastructure „ Upcoming projects the 41 Transylvania million is airport.Iasi. Hungarian and German. as well as good grasp of technical knowledge. Romtelecom. however supply of office space is adequate and rent levels are low.There is no underground public transport. fixed (via its own lines). English. • Key drivers for the city to emerge as a favourable SSC/BPO destination • Targu-Mures is an important university center.000 Employees: 200. road and air hub. Source: Local Statistics Institute (http://www.135.insse. Number of students: 12. at the junction of many national and European roads.a underway. the former national telecom company.

An important project is the setting up of the Arad Industrial Zone and Logistic Centre.ro/category. Hungarian. The successful privatization of several important factories (Astra Vagoane -railcars.ro/main.php?id=388) Infrastructure „ Office space There is an adequate supply of modern office space. taken over by Brau Union AG.php/Local-Transport/111/1/ Human resources „ „ „ „ „ „ Institutes of Higher Education: 2 Number of students: 20.European road and rail transportation junction in western Romania.tirgumures. French.30 | Romania as the destination for SSC and BPO Arad Location Population Major industries In the western part of Romania. Source:National Institute of Statistics – Romania www. 173. http://www.378 km). USA.000 Rail transportation equipment. „ People mobility The road network in Arad county has national roads (405.765 km).Iasi. the Arad Industrial Zone and Free Zone Arad-Curtici has already been inaugurated. and low • • . Footwear and Textiles. Key drivers for the city to emerge as a favourable SSC/BPO destination • The city has a strategic geographical location as the main gateway to Romania from the rest of the European Union and the most important trans. Automotive.php?option=com_content&vi ew=article&id=102&Itemid=236&lang=en. Austria) as well as investment in new industrial factories by attracting foreign and domestic investors has contributed to the economic development of the city. with the Mures River crossing it from east to west. Growing economy developing cost.insse. Source: Local Statistics Institute (http://www. while the other objectives are in an advanced stage of completion. Currently.mures. the Arad International Fair and Arad Free Zone .8% Average net wage: EUR 324 Languages spoken: Romanian.000 Unemployment rate: 3. Tremendous unexplored potential and proximity to already established SSC/BPO areas such as Timisoara and Cluj-Napoca. as the geographical location of the city at the junction of major commercial roads as well as its vicinity to the border has favored its economic development.ro/index. „ Telecom Infrastructure Mobile telephony and Internet services are relatively inexpensive and of higher quality compared to other CEE countries. office rental prices range from 6 to 10 EUR/sqm.Curtici.000 Employees: 105. Food.. English. A part of this project. county roads (1078. Furniture City introduction Arad is an important economic hub for the Western Romanian region. Arbema -brewery. Arad will be connected to the future Nadlac – Arad – Timisoara – Lugoj –Deva highway. This comprises the Cargo Terminal at Arad International Airport.327 km) and local roads (756. German.taken over by Trinity Industries Inc.

French. Oradea will also be connected to the Transylvania highway. German.000 Pharmaceuticals. around 10 km from the Bors frontier crossing. office rental prices range from 6 to 8 EUR/sqm. DN 76 and DN 79). Infrastructure „ Office space There is an adequate supply of modern office space. English. • . Currently.7% „ Average net wage: EUR 260 „ Languages spoken: Romanian. which has flights from major Romanian cities as well as some cities in northern Italy. Hungarian. Key drivers for the city to emerge as a favourable SSC/BPO destination • • It is a large regional economic center.Romania as the destination for SSC and BPO | 31 Oradea Human resources „ Institutes of Higher Education: 4 public and private institutes. social and cultural development in North West Romania. Future IT&C professionals are catered for by two of its largest institutions: The Automatics and Computer & Informatics faculties. capital of Bihor county. Lower workforce costs than in Bucharest and a high rate of qualified personnel.000 „ Unemployment rate: 4. Eurostat „ Telecom Infrastructure Mobile telephony and Internet services are relatively inexpensive and of higher quality compared to other CEE countries. 270.000 „ Employees: 151. petrochemicals. „ Number of students: 19. Oradea is served by Oradea International Airport. Population Major industries Source: National Institute of Statistics – Romania. „ People mobility Bihor has 412 km of National roads ( E60. textiles. Location Oradea is Romania’s tenth city and is located in the west of the country. DN 19. is one of the most important centers of economic. Source: The County Council of Bihor City introduction Oradea. The city is a traditional university center.

40 12.37 7 .32 million Moldovan Chisinau Moldovan Leu (MDL) 16. with four distinct seasons . Key facts on the Republic of Moldova Country Snapshot Country area Population Official language Capital Currency Average MDL/EUR (2010) Average MDL/USD (2010) Inflation rate (2010) Unemployment rate (2010) GDP per capita (2010) Time zone Climate 33.500 GMT + 2 (GMT + 3 in summer) Temperate-continental climate.4% 7 .843 sq.4% USD 2.32 | Romania as the destination for SSC and BPO 4.Km 4.

a modest recovery in the world economy boosted GDP growth to 6.5 6. coupled with its decision to double the price Moldova paid for Russian natural gas. both subject to parliamentary approval. while the forecast for the whole year is 5.7 2012 (forecast) 4. who is elected by a closed Parliament vote.8 2009 (6.632. National Bureau of Statistics of the Republic of Moldova.5) 7 . and Russia’s decision to ban Moldovan wine and agricultural products. National Bank of Moldova Moldova has no major mineral deposits and must import almost all of its energy supplies. The country’s central legislative body is the unicameral Moldovan Parliament.10) 2010 6.4 16.4) (2.5 7 . registering GDP growth of 7 . This is designed to help reduce the budget deficit.810 28. Ministry of Finance of the Republic of Moldova.9 (1.457 .333.941 31. The President appoints a prime minister who functions as the head of government. This is also supported by €1.9 7 . The onset of the global recession and poor economic conditions in Moldova caused GDP to fall 6. whose members are elected by popular vote on party lists every four years. Business and investment climate Key indicators Nominal GDP (EUR m) Total public sector debt (%GDP) Government deficit (EUR m) Trade balance (EUR m) Unemployment rate Average Exchange Rate MLD/ EUR Average Exchange Rate MLD/ USD 2008 3. Ministry of Finance of the Republic of Moldova.37 Source: The Economist Intelligent Unit. The head of state is the President.11 2010 3.Romania as the destination for SSC and BPO | 33 Political structure Moldova is a unitary parliamentary representative democratic republic. and who in turn assembles a cabinet.5 (741. EBRD .150.9% in 2010.4 15.39 2009 3.5%.29 10.768 18.2 Source: The Economist Intelligent Unit.7) 4 15.9bn in grants and loans over the next four years proposed at an international donor coordination meeting in March 2010.6) 6.4 2011 (estimated) 5. National Bureau of Statistics of the Republic of Moldova. contributed to a severe deterioration of the economy.5%.6) (1.52 11.5% in 2009. Key indicators Real GDP Growth (%) Inflation rate (%) 2008 7 . The Moldovan economy continued to show signs of recovery in the first half of 2011.40 12.5) (0.9 (941.2 12. However. It is dependent on Russian energy and trade. compared to the same period last year. The coalition government is trying to address the economic situation and has embarked on a series of strict economic reforms following a $574m agreement with the IMF in January 2010.9) (1.

Moldova entered the Autonomous Trade Preferences Agreement granted by the EU. Jewish (1. This has increased the country’s attractiveness as a trade partner and investment destination for foreign partners for the following reasons: • Moldova is a member of the World Trade Organization.8%). the Commonwealth of Independent States (CIS). as well as the Organisation for Security and Cooperation in Europe (OSCE).5%). The crisis is causing large numbers of immigrant workers to return (particularly from Russia and other CIS countries) and this is dramatically affecting the Moldovan economy. the International Monetary Fund (IMF). The ethnic composition of the country is as follows: Moldovan/Romanian (65%). other (1. the European Bank for Reconstruction and Development (EBRD). the World Trade Organisation (WTO). a CIS sub-group entitled GUAM (for Georgia. benefits from Free Trade Agreements with all the countries which are members of the CSI and CEFTA. It is a party to the Central European Free Trade Agreement (CEFTA) and NATO’s Partnership for Peace.34 | Romania as the destination for SSC and BPO Moldova is a member of the United Nations. Ukrainian (13. Azerbaijan and Moldova). while also being a member of Commonwealth of Independent States (CSI).2%). Moldova became a neighbor of the EU. the US. This has made the European Union Moldova’s main trading partner. Fiscal considerations and incentives for investors Once Romania joined the European Union. The average gross salary in June 2011 was EUR 222. which allows free access to European markets for Moldovan goods. • . and in its capacity as a CSI member and signatory of the Central European Free Trade Agreement (CEFTA). with foreign investment and exports down. Russian (13%).5%). Bulgarian (2%). Gagauz (Christian Turks) (3. From 21 January 2008. with more than 50% of Moldovan exports made to EU destinations. which is one of the most remittancedependent in the world. The languages are virtually identical and the two countries share a common cultural heritage. Two-thirds of Moldovans are of Romanian descent. Ukraine. Human capital Moldova has been severely affected by the world economic crisis. France and Spain are the largest investors in Moldova. Russia.

New FEZ residents (after January 1st. The multilingual workforce enables the development of applications or supply of support personnel speaking English. „ Free Economic Zone There are 9 Free Economic Zones (FEZ) in Moldova granting investors both fiscal and financial incentives. Giurgiulesti International Free Port. the authorities are about to adopt a decision either to maintain the previous fiscal incentive (0% corporate income tax) or to align their fiscal rule to the one applicable for the new residents. corporate income tax was increased to 12%. goods and services supplied from Free Economic Zones outside Republic of Moldova and in the Free Economic Zones either from Moldova or outside it. Taraclia. 2012) will be granted a reduction of 50% of the corporate income tax for incomes generated by export of goods and services and a reduction of 25% of the corporate income tax for the other incomes. Tvardita. thermal energy and hot water supplied for the population. and selected pharmaceuticals 6% for natural and liquefied gas Zero for exports of goods (services). French. corporate income tax was 0%. Reduced tax rates apply as follows: • • • 8% for bread and bakery products. Tax incentives „ Until the end of 2011. the labor rates for highly skilled software engineers are among the lowest in the region. Ungheni.md/ (Organization for promoting investments into and exports from Moldova) . and other languages. Moldova provides software development and engineering. Romanian. SSC/BPO setting The SSC/ BPO and IC&T sector are Moldova’s most dynamic sectors.Romania as the destination for SSC and BPO | 35 „ Value Added Tax The standard VAT rate is 20%. Source: http://www. milk dairy and agricultural products.miepo. international freight and passenger transportation. Also. electric power. Otaci-Business. Free International Airport Marculesti. Ukrainian. Russian. business process outsourcing and call center outsourcing to numerous national and international organizations. VAT for FEZ residents is 0% in the above mentioned conditions and the excisable goods acquired in the Free Economic Zones are excise exempted. Starting 2012. For the residents present before January 1st 2012. The 9 FEZ are: Expo-Business-Chisinau. Valkanes and Balti. being also cancelled the fiscal facilities in place in 2011 for investments stimulation.

The Moldovan government places a strong focus on the medium term development of the IT&C sector.R.R. Population Major industries Source: AmCham.global-phoning. electrical goods. Company name Moldauditing S.md/pxweb/Dialog/Saveshow.callcenterpro.L.L. www. 719. Bridge Moldova S.L. on the Bic river. Consumer goods.statistica.md. Ecofin-Audit-Service S.R. administrative.com. machinery.asp . Chisinau is the most economically developed and industrialized city in Moldova. Main services offered BPO for Finance & Accounting BPO for Finance & Accounting BPO for call centre services BPO for call centre services BPO for IT services BPO for IT services BPO for IT services BPO for IT services City introduction Chisinau is the capital of Moldova. textiles. economic and cultural centre. Iricom Company GPG Group S. as it is considered to be the main driver behind Moldova’s economic growth.L.36 | Romania as the destination for SSC and BPO Chisinau SSC/BPO setting Development of SSCs/ BPO is taking place in 4 main sectors – IT.mediasoft.md Source:http://www. www.000.md/md/home/. www. http:// statbank. I.compudavafoundation.L.L. Media Soft S. Pentalog S. org. augmenting labor productivity and enhancing international competitiveness. public relations and professional accountant services.R. Endava S.bridge-moldova. www.R.md.M. Location Chisinau is situated in the centre of the country. while accountancy services are provided mostly to local companies.md. Human Resources.moldova.L.R. It is the largest city in the country and it is the political. www. The first three develop on an international level.R.

000 Unemployment rate: 6. supplemented by the easy access of Moldovan nationals to Romanian academic institutions. There is no underground public transportation.5% Average net wage: EUR 220 Languages spoken: Moldovan/ Romanian.org/page/chisinau-infrastructura-locala-144-rom.php?l=ro&idc=585&id=2701 Local travel is available by means of public transport within the city area and by railway and regular bus routes within the rest of the country. French.Romania as the destination for SSC and BPO | 37 Human resources „ „ „ „ „ „ Institutes of Higher Education: 36 public and private institutes. Source: http://www. • • Key drivers for the city to emerge as a favourable SSC/BPO destination • Low operating costs: maintenance costs.A. „ People mobility Currently the development of the city’s infrastructure is limited due to harsh economic conditions. There is a tendency towards a decrease in prices and an increase in the quality of telecommunication services.com „ Ease of commuting Travelling in the city and suburban areas is easily possible through regular bus routes. German.chisinau. Source: http://www. the major one being Moldtelecom S. which facilitates communication. as well as taxis and private cars.wordpress. The mobile communications sector is divided between four companies. There are internet providers in Moldova that offer both broadband and dial-up Internet connection. Taxis and personal cars are also widely used.500 USD. „ Telecom Infrastructure „ Upcoming projects There are 16 providers of landline phone communication services. buses and airplanes – these fly to all major European airport hubs. both salary and Quality of talent: there is a relatively good education system in Chisinau. English.md Infrastructure „ Office space At the end of the first half of 2011.statistica. Moldova still has cultural links with most other CIS countries. trolleybus routes.html Quality of life „ Cost of living Low cost of living indicator as compared to Romania. Russian. offering almost complete coverage of the territory of the country (excluding the TransDniester region). Source: www. The Development of Chisinau is a project whose key objective is to assist Local Public Authorities of the Chisinau Municipality in the process of strengthening its institutional and financial management capacity to support the achievement of long-term development goals and improve service delivery.internationalcostofliving. However the General Plan for the Development of Chisinau includes measures for improvement of road communications and traffic conditions. which dominates the market (app.moldova. Linguistic and cultural similarities: as a former USSR country. it also has strong linguistic and cultural ties with Romania. Internet connection is available also through providers of mobile telephony services. Number of students:123. Congestion problems are limited to a few streets in the city centre. Average GDP per capita is 2. The quality of roads in the suburban area is much poorer than in the city itself. 90% share) and offers a wide variety of services. Source: www. . International travel is also available by rail. the average monthly rate for an office space was 7-9 euro/sqm.000 Employees: 1.md/libview.256.

business modeling. instead of just being specialists in one discipline. where appropriate. Our talent pool of highly qualified professionals has always been our greatest strength. integration and separation advice. They take time to truly understand your business and are plugged into the issues that matter. in the context of a market entry exercise. valuation services. Clients using our full range of advisory services benefit from improved efficiency of data gathering and communication as well as cross-fertilization between the teams. KPMG can provide market intelligence. Nothing is considered in isolation but in terms of how it will promote overall corporate well-being. KPMG has industry specialists across all industries and sectors. this means that KPMG staff gives you the broad picture. We gather hard-to-find information from primary and secondary sources to present a fact-based and independent view. due diligence assistance. to call in more specialist expertise. IT Advisory. Multidisciplinary by essence. we encourage our people to cross into other functions to bring a more rounded and comprehensive approach to every assignment. which allows us to offer you a better deal in relation to cost. As a multidisciplinary advisory firm. feasibility studies. M&A advisory. For clients. resources and networking capabilities in Romania along with a broad range of external information.38 | Romania as the destination for SSC and BPO KPMG: Multidisciplinary teams with in-depth industry expertise Our teams leverage a high level of local expertise. . Our teams have the know-how and experience to consider the big picture and. tax structuring. HR Advisory and accounting advisory services.

Romania as the destination for SSC and BPO | 39 .

3rd Floor.O. Timisoara Timis. Cluj. there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. T: +40 (741) 800 800 +40 (372) 377 800 F: +40 (741) 800 700 +40 (372) 377 700 E: kpmgro@kpmg. Head of Markets Tel: +40 (372) 377 792 E-mail: rperrin@kpmg. a Swiss entity.Ploiesti no.ro Cluj Napoca Office Power Business Center Calea Dorobantilor no. no.com Cristina Ionescu Senior Manager.md The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Romania T: +40 (756) 070 044 F: +40 (752) 710 044 E: kpmgro@kpmg.ro Timișoara Office Mihai Viteazul blv.ro Constanţa Office Mamaia blv. 300222. a Romanian limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”). Iasi. . no. Bucharest.ro Iași Office Saulescu str.R. All rights reserved. 9th Floor MD-2004. SSC/ BPO Tel: +40 (372) 377 794 E-mail: cionescu@kpmg. Romania P Box 18-191 . © 2011 KPMG Romania S.. Soseaua Bucuresti . 013685.ro KPMG Moldova SRL Chișinău Office Stefan cel Mare str. 69-71 Sector 1.md www.kpmg.. no. 2nd Floor. DN1.Contact us Richard Perrin Partner. no. KPMG and the KPMG logo are registered trademarks of KPMG International Cooperative (“KPMG International”).com Cristian Stoica Director. 202.. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. 18-20 400117 Cluj-Napoca. 700010. a Swiss entity. 29.com KPMG in Romania Bucharest Office Victoria Business Park. 900540. Constanta... 208. Romania T: +40 (256) 221 365 F: +40 (256) 499 361 E: kpmgro@kpmg. 30. Romania T: +40 (740) 333 344 F: +40 (753) 333 800 E: kpmgro@kpmg. Printed in Romania. Although we endeavor to provide accurate and timely information.L. Chisinau Republic of Moldova T: +373 (22) 580 580 F: +373 (22) 540 499 E: kpmg@kpmg. SSC/ BPO Tel: +40 (372) 377 800 E-mail: cstoica@kpmg. Romania T: +40 (756) 070 048 F: +40 (752) 710 048 E: kpmgro@kpmg.

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