>>>Interview with Mr. Eilif Gundersen, Counsellor, Deputy Head of the Mission, Royal Norwegian Embassy in Bucharest
By Constantin Radut
-What has been the evolution of bilateral trade and your estimates for the years 2018/2019?
-The Norwegian-Romanian relations are quite dynamic, and this can be noticed under all aspects, including the economic one. Romania has a trade surplus with Norway, mainly due to the large scale of Romanian exports of ships and ship hulls to Norwegian shipping companies. The bilateral trade has increased substantially since the turn of the millennium, and the value of Romanian exports in 2017 was about 2.4 billion NOK (~250 million EUR).
In the last few years, the range of goods imported by Norway from Romania has become much more diverse. It ranges from cars and car components, to IT services and telecommunication, from offshore exploitation services, to textiles. A significant part of the Norwegian imports include ships and ship hulls, military vessels, fishing boats, passenger- and cargo ships, as well as machinery, iron products, and medical instruments(1).
Among Romania’s principal imports from Norway are fresh and frozen fish, machinery, electronics, medical, industrial and scientific instruments, as well as chemical and metal products(2).
Norwegian imports from Romania reached a peak in 2014 (4.87 bln. NOK). Since then it has decreased gradually year by year reaching 2.43 bln NOK for the year 2017. Norwegian exports to Romania peaked in 2013 (1.47 bln NOK). Since then it has been fluctuating up and down around 1 bln. NOK. Based on preliminary data related to the first half of this year, it seems that the both the imports and exports from and to Romania might be higher this year.
When it comes to investments, the Government Pension Fund Global should be mentioned. This fund represents Norway’s model of saving money for future generations, when the oil and gas reserves will run out. According to the last available numbers by the Government Pension Fund of Norway, from December 2017, the fund has invested 710 million NOK in equities (~87 million USD) in 10 different companies, mainly within finance and energy companies. Furthermore, the fund has fixed income investments in Romania amounting to 589 million NOK (~72 million USD).
It is difficult to formulate a forecast when we are considering such dynamic markets. However, considering the trend so far, the financial data at our disposal, as well as the increasing interest both ways, I think we can expect growth in bilateral trade.
-Is there currently a formal framework for entrepreneurial cooperation between companies in the two countries (association, agreements, contracts, etc.)? What are the most significant cooperation projects?
-There are several formal frameworks in place, which facilitate cooperation. One of them is the Convention signed between Romania and Norway for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income, which was ratified in 2016. However, there is an even more important aspect to consider here. When Romania joined the EU in 2007, it also became part of the Economic European Area (EEA) Agreement. This agreement makes Norway, Iceland and Liechtenstein equal partners in the EU internal market. In other words, it gives Norwegian companies access to the EU market, and European companies – including Romanian – free access to doing business in Norway, Iceland and Liechtenstein. It is also the most comprehensive – and important – economic agreement Norway has ever entered into. This includes a shared goal of working together for reducing poverty and economic disparities across Europe. This cooperation materializes through the EEA and Norway Grants, made up of contributions from the three states. They also serve to strengthen bilateral relations with 15 countries in Central and Eastern Europe and the Baltics, which are the beneficiaries of this funding. Romania is the second biggest beneficiary. The projects implemented in Romania through the Grants have covered a wide range of sectors: from justice and home affairs to social inclusion, environmental protection and strengthening the NGO sector. With the third agreement covering the period up until 2021, it will receive a total of 906 MEUR.
As mentioned previously, the second overarching objective of the EEA and Norway Grants is to strengthen cooperation, have joint results, and increase mutual knowledge and understanding between Romania and Norway, Iceland and Liechtenstein. The bilateral relations are fostered through partnerships at programme and project level, in a big number of sectors and at all levels: political, administrative, as well as in the private sector, civil society and academia. There are special funds meant to facilitate partner search and cooperation. A fund of approximately 10 MEUR has been set aside to finance bilateral cooperation initiatives of a wider scope than the programmes.
Allow me to give you a small example regarding the extent and the amplitude of the cooperation. Since your question was mainly about commercial and entrepreneurial cooperation, I will refer to a programme called Green Industry Innovation and which targeted SMEs in the previous funding period. Out of a total number of 50 projects, 32 where implemented in partnership with Norwegian entities. This speaks about the real interest from both sides to establish long lasting business partnerships, improved knowledge and mutual understanding.
Our efforts to support growth, innovation and competitiveness are underpinned by our vision for the current period of the EEA and Norway Grants, namely “working together for a green, competitive and inclusive Europe”. We will build on the experience from this period. We will continue to target SMEs and to contribute to increased value creation and sustainable growth by supporting innovative technologies, processes and services in green industry innovation, blue growth and ICT. These are the three main pillars of the current programme, which has an ongoing open call until November 1 2018.
Details about all these can be read on the website www.eeagrants.org
-Do you appreciate that there are areas where a better partnership between governments and / or companies should be started at bilateral level?
-There is certainly room for a better knowledge of the realities and potential from these two countries. Romania has many business opportunities that the Norwegian companies are not quite aware of. In addition, Norway has good practices and experience that maybe some Romanian companies could benefit from. Sectors like ICT, renewable energy, e-health, tourism are among the ones with the highest potential for an increased cooperation. The EEA/ Norway Grants cooperation is primarily intended to benefit Romania, but many of the programmes are implemented with partners from the donor countries, making it a good opportunity for companies to get to know new markets. Therefore, the EEA/ Norway grants framework is an important tool for reaching this potential.
Moreover, the Norwegian- Romanian Chamber of Commerce, NOROCC, has recently relaunched its activity with a new and dynamic team in place. A matchmaking between Norwegian and Romanian businesses already took place, hosted by the Romanian Embassy in Oslo. There is a great potential and interest for increased cooperation, so more events will follow.
-In the field of foreign investments, what are the sectors in which companies in your country have invested in Romania and what projects are in the attention of companies in your country? What Romanian investments are now on the business market in your country?
-At present, about 60 Norwegian companies are active in Romania. These are mainly present within the maritime sector, food production, IT and energy. They are spread all over the country, but more concentrated in the eastern part of it, around the ship building industry.
When it comes to Romanians living in Norway, it is important to know that Norway liberalized the labor market for Romanian citizens in 2012.
According to Norwegian statistics, there are about 14,000 Romanians living now in Norway. From our sources, this community is the second best integrated, after the Swedish one.