BrexitToRemainia newsletter #38By CC / In Newsletters / 0 Comments
Did you miss the Romanian internal politics? If so, good news: we have some fresh scandals to update you on (together with the impeachment of few ministers). Or else, if your focus in on the next thing to buy or fund to raise, have a look at the IT&C consolidation trend or apply for the Chivas Venture Competition. And if your next visit to Romania is coming soon, be sure to congratulate your Romanian peers for the success of Simona Halep (#1 WTA in tennis) or even attend an International Symposium in Management & Entrepreneurship (did you know they exist?).
Be savvy: know what`s happening right now in Romania. News from politics, economy, business, various industries and social life.
New ministers (again!)
Have you noticed something? We didn`t speak about internal politics since BTR edition 34 (meaning almost 2 months ago). At that point, current PM Mihai Tudose had been in place for roughly 2 months, after his predecessor Sorin Grindeanu governed for 6 months before being impeached. A similar situation could have happened to Mr. Tudose last week, when he asked his party (PSD) to recall some of his ministers involved in the Belina scandal. But this time we have a happy ending, at least for the prime minister. Let’s take things in order:
- Belina scandal: Few weeks ago, a 300 acre island on the Danube river (called Belina) has triggered a huge anti- corruption scandal. It involved Liviu Dragnea (the powerful leader of PSD) alongside few of his closest allies in the Government (the ministers mentioned below). How come? A few editions ago we talked about Dragnea’s affairs with TelDrum. This is a private company in which Dragnea holds strong (but indirect) equity and which has won several obscure contracts with the County Council he led in the past. It was unveiled recently that Belina island is now owned by TelDrum, even if it was supposed to be part of the national patrimony.
- Impeachment proposal: Given the above, the National Anti-Corruption Agency (DNA) uncovered that Belina was transferred from national ownership into county ownership back in 2013 (Which county? of course Teleorman, Dragnea’s county). So they placed under investigation two persons liable for that (presumably) illegal transfer: Rovana Plumb (at that time Minister of Environment & Climate Change) and Sevil Shhaideh (Secretary of State by then). And because individuals placed under investigation should not be part of a Government, PM Tudose requested his party the recall of Mrs Plumb (now Minister of European Affairs) and Mrs. Shhaideh (Vice-Premier and Minister of Regional Development), among others. As one can imagine, things are never black and white in politics, so speculations and conspiracy theories abound in mass media (including the interference / pressures from Brussels or the internal revolt of local PSD “barons”)
- PSD voting outcomes: The General Assembly of PSD requested to decide the fate of impacted ministers took place on 12th of October. Until break it all seemed “as planned”, with loads of PSD members expressing support for the targeted ministers (close allies of Mr. Dragnea, as mentioned). But something happened after the break (and before the vote). PM Tudose came back in the room together with few of the party’s local barons thought until then to support the party leader. So what happened during the vote seems to be a “change of arms”: ministers were impeached in defiance of Dragnea’s authority. Wow!
- What next: few critical ministerial position became vacant as consequence of the recall: Ministry of Regional Development, Ministry of EU Funds and Ministry of Transport (outside of Belina scandal, its previous minister was also on the list of recalls). Felix Stroe, president of Constanta PSD organisation (and critic of Dragnea since impeachment of Grindeanu) becomes Minister of Transport. Paul Stanescu (baron of Olt and friend of Dragnea, but with penal charges hunting him, too) is being proposed as Vice-Premier & Minister of Regional Development. Ministry of EU Funds will be led by a close ally of Rovana Plumb, Marius Nica.
Albeit long, we feel this article will continue to matter in the months to come. Some of the newly proposed ministers are targeted by penal investigations, so we might see more impeachments coming up. PSD (aka Dragnea) is still trying to annihilate the Justice (i.e. by recently imposing a political ally to lead the Court of Audits, therefore making it harder to punish any wrongdoing in how public funds are being used). Street protests continue, even if not of the size seen in February. To be continued.
Take action: grasp opportunities for advancing business in (and/or with) Romania. What others think & do. What business events to attend.
Bittnet in the offensive
The first Romanian IT company to be listed at the Bucharest Stock Exchange (in April 2015) was Bittnet. Launched in 2007 by brothers Mihai & Cristian Logofatu, the company is market leader in IT training & solutions, with revenue of over 5 million EUR / year. Recently Bittnet announced the acquisition of Gecad NET, one of the first ventures of (well known investor) Radu Georgescu. The move brings doubling of revenues to Bittnet, more comprehensive cloud computing and cyber security solutions and also a much larger retail footprint throughout the country.
Why is this important? Because the IT&C market in Romania is undergoing consolidation, as was the case with all similar markets in other countries. If you are an investor in, or plan an exit from IT&C, these seem like good times for action :).
Chivas Ventures for social impact
“If your business creates positive change, the Chivas Venture Competition is for you. Applications are open until 9 am GMT on 30th October.” This is how the registration page starts for the 1-million dollar venture capital pot launched in 2014 by the alcoholic beverage brand with same name :). The competition is said to have attracted 6.000 candidates from almost 30 countries until now, which is realistic considering the value of the prizes at stake. So how can you get there?
- Be sure you meet the eligibility criteria: less than 1.5 million EUR revenue, still in Discovery, Startup or Growth stages, of course social impact purpose
- Register to the Romanian / your national competition first (registration link above) – by Oct 30th
- Secure your place in the top 5 ventures at national level (at least this is the rule for Romania)
- Use the knowledge of your local mentors and the 5.000 EURO prize gained in the national competition to prepare for the international round (March – May 2018)
- Good luck! You are one among 1.000+ ventures eyeing the same thing
Know your game: Build your Aces for when you meet a Romanian business partner for coffee. What we (might) like to talk about.
Simona Halep #1
Being world champion in tennis is not easy, especially not for a Romanian player aged 26. Simona Halep, which we introduced here, reached WTA #1 place last Saturday (October 7th), when she qualified for the final of China Open in Beijing. Only one Romanian tennis player has ever made it so far: Ilie Nastase in 1973. Protecting first place will be hard, admits Halep, especially since Garbine Muguruza, the Spanish player, is only 40 points behind.
Symposium in Management, Timisoara
If, for some reason, you are interested in the science of management, innovation and entrepreneurship, SIM 2017 academic conference is a good place to be. Organized during 27-28 October 2017 in Timisoara by two major local universities, the 14th International Symposium in Management (SIM) will cover topics such as management of innovation, supply chain management, economics of small & medium sized enterprises, change management etc. Attendance fee is 200 EUR and you can contact the organizers here.
Romanian Overview Report: In this comprehensive report you will find information about: macroeconomic landscape, industries and investments, infrastructure and technology, taxation system, human capital, governmental support and last but not least quality of life in Romania (if you decide to move over here ;)).
Investor Guide Romania: In this well-structured guide you will find information about: investment climate in Romania, economy in general and the business ecosystem in particular, availability of financing, employment and labour law, fiscal policies, as well as how it is for an expat to live in Romania (not too bad, we can assure).
#MondayMemo Newsletter (register): If you are Romanian (or able to speak the language) we highly recommend you register to MondayMemo. It is a weekly newsletter dedicated to entrepreneurs covering news from Romania and abroad (written exclusively in Romanian though!). While we just like to read news and share them with you, the author(s) of MondayMemo are experienced and high quality journalists: Mona Dirtu and Andreea Rosca.