How optimistic are Romanian businessmen?

Pessimistic about their own companies

On the other hand, Romanian CXOs are the most pessimistic about the current financial prospects of their companies (with only 15.4% expecting an improvement, compared to the leader of the chart, Poland, with 76.7%).

These findings were included in Deloitte’s first Business Sentiment Index (DBSI) – a research-based analysis of the opinions and predictions of Chief Executive Officers (CXOs) of the largest companies within six countries in Central Europe (CE) - Poland, Hungary, the Czech Republic, Slovakia, Croatia and Romania.

According to most respondents (65.4%), there aren’t significant delays in payments in Romania (from this point of view, local companies rank second in the region after Poland, with 79.1%).

Most Romanian respondents expressed interest in launching new products and services over the following 12 months (61.5% of total answers, following a 62.8% in Poland).

60% of Romanian respondents expect a more restrictive regulatory environment over the following 12 months, while 69.2% of Romanian companies consider EU grants very hard to get.

“The DBSI findings confirm the results of our First CEO Survey launched at the end of May,” underlines George Mucibabici (photo), Chairman Deloitte Romania. “Romanian companies continue their business growing strategies, while paying more attention to costs (for example, most respondents are planning to launch new products and services, while also anticipating a reduction in spending on capital goods and new reductions in personnel). On the other hand, businesspeople expect further restrictions from the regulatory environment, over the following year, while also highlighting the difficult access to EU grants.”

Accessing EU grants � a priority

Accessing EU funds should be a priority for Romania, especially at such difficult times when lack of funding is affecting investments and delaying projects.

Radu Kubinschi, manager with Grants & Incentives, Deloitte Romania’s specialized department in accessing structural funds, underlined that interest from the Romanian business community is getting stronger day by day.

“Over the past year, we have seen sustained growth in demand, with the number of clients increasing by 38% compared to 2008. Projects are numerous, but with smaller values compared to last year. Given the economic crisis, companies have changed focus towards keeping their employees and restructuring organizations, a trend reflected in the destination of structural funds this year: 90% for HR-related projects, SMEs and cross-border cooperation (5% each). By comparison, 80% of the financing projects last year were focused on equipment investments, tourism (5%) and HR (15%),” Kubinschi said.

Deloitte Business Sentiment Index in the region

Cautious optimism is the heartening finding of Deloitte's first Business Sentiment Index. Responses of some 200 CXOs include views about the current and future business environment, ranging from employment prospects and payment trends to new product development and capital expenditure.

Findings have been collated into an index which this quarter equals 97 and the next quarter (to be released early December) will compare the differences and similarities of views and attitudes across national boundaries and between industrial sectors. Deloitte will be publishing the index regularly in 2009 and 2010 and then every six months thereafter.

The Report will be a regular barometer that gauges the thoughts of those with greatest influence on the future direction of the economies and largest companies of Central Europe. The index provides a much-needed outlook based not on statistics and balance sheets, but on the human reaction and opinions of these influential executives, who are crucial not only to their company's success but, by extension, on the recovery and renewed growth of individual country economies and that of the region as a whole.

Central Europe: Main conclusions

On a general outlook, around three quarters of those surveyed felt the economy in the next year was either going to get worse or remain the same. Going against this trend for caution and pessimism the survey found that business leaders were conversely quite optimistic about the prospects for their individual enterprises, with only around 15% having negative views about the future.

Of the six countries surveyed, Poland is the most bullish about its prospects – both in terms of its economy and from a company perspective. Poland has enjoyed continued consumer demand in comparison to other countries in the region. Croatia, on the other hand, is very pessimistic about the economy (89.7% of negative responses).

On balance, the findings show that although there is still deep-seated negativity about the short-term prospects (six months) across the majority of issues discussed, there are definite signs that positive feelings are slowly beginning to counter-balance this pessimism.

Credit still available. Likelihood of M&A activity, very slim

• Despite perceived credit issues globally, almost two thirds (57.9%) of respondents feel credit is still available to them if necessary, with almost a fifth feeling it is easily available;

• Over half believe payment terms are still safe, with over 45% thinking they are fairly safe;

• Almost half (45.3%) expect sales revenue to increase over the next 12 months;


• Over half are optimistic (with 44% fairly optimistic) about launching new products of services in the next year;

• Reflecting the trends globally, opinions about employment levels continue to be pessimistic, although over half (52.1%) expect levels to remain broadly unchanged, with 31.6% believing they will reduce somewhat;


• The likelihood of M&A activity is very slim, with 60% thinking it unlikely for their company to entertain thoughts of takeovers at the moment;

• Over half (51.6%) believe EU grants will be hard to obtain, compared to just over a quarter (25.5%) believing them to be available.