Romania plays regionally well below the potential of the economy, despite the growth of the last two decades

After two decades of remarkable economic growth, the GDP per capita at purchasing power parity reached from 35% to 79% of the EU average last year, a performance that confirms Romania's economic progress and the improvement of living standards, according to a specialized analysis.

Romania plays regionally well below the potential of the economy, despite the growth of the last two decades

Although the development is uneven, it is remarkable that the economy has shown resilience, despite multiple global crises in recent years, and continues to grow in 2025, even if the fiscal-budgetary problems have become more acute this year.

“The prerequisites for our country to become a robust, mature and diversified economy exist, but in order to translate them into reality, we must resolve the fiscal-budgetary situation, continue to attract foreign direct investments, European funds and, above all, identify a clear reform strategy to relaunch economic growth and capitalize on the potential. From this perspective, Romania does not seem to be fully aware of the importance of the role it can play and has not even taken the first step of regional positioning and identification of opportunities in its geographical area.

We are used to capital flows and strong economic relations being with already traditional partners: like Germany, France or Austria. But it is worth looking closer at the borders, as the surrounding states have already done, especially in a political and military context in which Central and Eastern Europe has become a key area both geostrategically and economically, thanks to the development of the last decades”, says an analysis by Daniel Anghel, PwC partner.

Analyzing economic relations and investment flows, it can be seen that our country has become a fertile ground for capital from Poland, the Czech Republic, Greece or Hungary, which have invested billions of euros in Romania, in energy, real estate, retail, FMCG or IT&C, the analysis shows. The presence of companies from these countries confirms the attractiveness of the Romanian market, determined by the size of the economy, the potential for growth, the workforce and the geographical position, but it also shows at least two other important things – the surrounding states are looking to expand their businesses and want to gain regional influence, and we should do the same. Although it has the second largest territorial size and population after Poland and an economy that has massively recovered the difference compared to the European average, Romania seems not to realize that it is an actor with still too small a role.

Romania, top destination for neighbors' investments

Thus, if we look at Romania's largest regional partners – Greece, Hungary, Poland, the Czech Republic and Bulgaria – we notice that they have increased their direct investments in our country by 64% between 2019 and 2024, up to a total of 10 billion euros from the stock of total foreign direct investments of 125 billion euros.

For example, Greek investments in Romania increased by 170% in the last five years, boosted of course by the purchases made by the PPC group in energy, those in Hungary advanced by 94%, in Bulgaria by 90% and in Poland by 84%.

Therefore, for Greek and Bulgarian investors, Romania became the second largest investment destination across borders, and for Polish and Hungarian investors, it reached the top 5.

Greece's investments in Romania reached 16% of the total investments made abroad, and for Bulgaria, 11%. For their part, investors from Hungary have the most companies registered in Romania – over 15,300 in 2024, 10% more than in 2019. In the same period, the number of Greek companies increased by 17%, Bulgarian ones increased by 29%, and those with Polish shareholders recorded the strongest dynamics, rising by 56%.

From the perspective of the industries, Greek investors had an important presence in the real estate area, and the entry of the PPC energy group on the Romanian market brought a resurgence of interest in the Romanian market, with the energy sector in the center of attention, which also attracted other investments from Greece in recent years.

And the Czechs invest massively in real estate and energy, while the Poles are the most active in the transaction market, especially in recent years. Thus, more and more Polish companies listed or supported by international investment funds have discovered opportunities for strategic expansion in Romania. The fields in which they invest are diverse, from retail and the food industry, to tourism, energy, IT&C and the manufacturing industry, the largest Polish businesses in Romania being in the field of trade, through fashion retailers and in the FMCG sector.

Although Bulgarian investments in Romania are lower than those of other countries in the region, their value almost doubled in the period 2019-2024, reaching over 650 million euros. Part of the Bulgarian investments came through private equity funds that have invested in Romanian companies in recent years.

Romania, minor player in the region

However, Romanian investments in the region remain at a very low level, although there is a growing trend in recent years. The stock of investments made by Romanian companies in the five analyzed countries was 645 million euros at the end of last year. The most significant investments were in Bulgaria, of 300 million euros, but the amount represents less than half of the Bulgarian investments in Romania.

Total Romanian investments abroad (not only in the states of our geographical region) are also very low. At the end of 2024, their stock represented 7.8 billion euros, but more than half (4.1 billion euros) were investments made in the country by Romanians through companies registered in other jurisdictions, according to BNR data. Thus, the total effective investments made abroad until last year were 3.7 billion euros.

By comparison, total Polish investments abroad amounted to 38.6 billion euros last year, Hungarian ones to 44.4 billion euros and Czech ones to more than 70 billion euros, according to available statistics. Even the investors from Bulgaria had investments abroad of almost 5 billion euros higher than Romanians abroad, given that Romania's economy is more than three times larger than that of the neighboring country.

The contrast between Romania and the countries in the region is strong. Our country attracts capital, but does not export enough of its own capital. This asymmetry is not only a matter of statistics, but also one of economic influence and strategic positioning. The lack of Romanian champions with a solid presence outside the borders shows the current limits of capitalization, strategy, and support for internationalization.

The example of Poland

If we take the example of Poland, we see that in recent years the expansion of companies through exports and investments outside the country have been carried out strategically and intensified with coherent government support, states the PwC analyst.

According to him, in recent years Poland has made concerted efforts to increase exports and expand the network of foreign trade offices to support Polish firms in new markets and attract foreign direct investment through the Polish Investment and Trade Agency.

This ability of Polish companies to reach markets not only in our geographical region, but also in Great Britain, the USA or Australia is based on a mix of public policies that have generated a more stable, predictable and stimulating macroeconomic framework for development. Instead, Romania faces fiscal pressures and external imbalances that limit its potential. Both economies depend on foreign investment and EU funds, but Romania's structural weaknesses imply a higher risk. In short, politics influences the economy through stability, predictability and the ability to implement reforms.

Due to the presence in other countries, the profitability and financial stability of Polish companies are higher, and income flows from outside the country support the balance of payments, and the country's economy becomes more competitive in the long term. Basically, the major difference comes from fiscal policies and political stability.

From a macroeconomic perspective, Romania and Poland have many similarities, having many similar figures, but also a very important difference – the balance of payments situation that reflects how much each country spends and earns from its relationship with the outside world. While Poland had a current account deficit of 0.9% of GDP in September 2025, Romania had 8% of GDP, a record level in the EU. The main causes for Romania's large current account deficit are high domestic demand, correlated with a very large budget deficit and low tax revenues. Poland, on the other hand, compensates with a surplus in services and significant inflows from European funds. It is certain that Romania needs fiscal consolidation and export-oriented policies.

“Extending the presence of Romanian companies across borders could bring multiple benefits: the generation of revenue flows from abroad would contribute to reducing the current account deficit and improving the balance of payments; it would strengthen the economy's resilience to external shocks, it would diversify risks and increase Romania's regional and international influence.

At the same time, the attraction of foreign investments in Romania remains crucial for the growth of the economy, development, and the reduction of disparities. But in order to achieve these objectives, public policies and, above all, fiscal ones, which create balance and stability, i.e. a attractive investment climateare decisive“, concludes the PwC analyst.