Romania’s Top CEOs: Shaking off inefficiencies before the next business wave
The global downturn has only prompted a correction that  the local market badly needed


Bucharest, Romania – May 27, 2009— Romania’s Top CEOs reaffirm their long-term commitment to the local economy, despite the difficult year prompted by the global economic crisis, but underline the pressing need for more transparency and active involvement of the Government, according to the First Romanian CEO Survey - “Business at a crossroads - The right path ahead”, released today by Deloitte Romania.

Stopped from their dynamic growth by an abrupt downturn, Romanian businesses take now a closer look at internal structures, clean up inefficiencies built up throughout the years, and put their best competitive advantages at work, hoping for a stronger position once the market starts a new economic cycle.

“The general perception of the CEOs Deloitte has interviewed is that the local economic downturn, although caused by global events, is actually a necessary correction that had to take place,” said Antonis Ioannides, Transaction Services Partner, Deloitte Financial Advisory. “Many businesses have been run inefficiently for many years and now they have the chance to optimize operations. 2009 will definitely not be a growth year, but CEOs are confident in the long-term prospects of their businesses and the local market overall.”

One main challenge as identified by a great majority of respondents is the Government’s role within the economy, with CEOs expecting much more involvement, long-term planning and real action. Infrastructure works, from this perspective, could be a good start.

“Deloitte has been stressing for some time now the potential of Private Public Partnerships (PPPs), and discussions with Romania’s Top CEOs have only confirmed the business environment’s interest and availability to join this type of projects,” underlined George Mucibabici, Chairman Deloitte Romania. “As a result, infrastructure overall – starting from the much debated transport infrastructure to public administration, urban development, waste management, education, health, sports and leisure , etc. - becomes the golden opportunity for Romania in such challenging times.”

In parallel, the private sector will witness a healthy and active wave of consolidation, with most respondents looking at the second half of 2009 and beyond.
“The M&A market is still on hold, mostly because it needs to first undergo a natural selection and eliminate the weakest players, and also because there is still an important imbalance between sellers and buyers’ price expectations,” explains Antonis Ioannides.
The Deloitte CEO Survey was carried on between February 20 and April 30 and reflects contributions of more than 300 leading Romanian businesses in terms of revenues as per their 2007 results. More than half of the interviews were carried out during face to face meetings with Deloitte Partners and Directors. Participants represent the most important industries active in Romania: Consumer Business (21%), Financial Services (17%), Telecommunication, Media and Technology (13%), Manufacturing (12%) and Real Estate and Construction (12%), Energy and Resources (11%), Aviation and Transport (7%) and Life Sciences and Healthcare (7%).

Deloitte Romania reported a 36.26 million Euro turnover for the calendar year 2008, up some 32% against the 27.5 million Euro figure reported in 2007. The revenue breakdown by service lines is 40% audit services and 60% professional consultancy services.



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