Romanian construction firms need to carry out massive investments in order to be able to compete with powerful foreign firms that have entered the domestic market, say players in this industry.
New laws on acquisitions further affect Romanian firms, making it easier for foreign firms to win major contracts on the market.
"Romanian construction firms broke up after 1990, as huge construction companies with 2,000-3,000 employees broke into smaller firms that are now striving hard to survive on the market," stated Florian Florescu, financial manager of the Arcom construction company.
Over the past years, major infrastructure contracts have been secured by international players such as Astaldi (Italy), Colas (France) and Max Bogl (Germany), which have secured a strategic position on the construction market. "Companies undertaking big contracts must have solid financial power, be credible for banks and have an important work portfolio," specifies Florescu.
Domestic firms stand little chance against foreign firms, considers Mircea Bulboaca, chairman of Con-a group, which is currently building the biggest commercial park in Transylvania, located in Selimbar, near Sibiu.
"Unfortunately, the construction industry is regulated by laws discriminating against or putting Romanian construction firms at a disadvantage. Turnover is taken into account when a contract is awarded by a tender. What can we do when foreign firms with turnover worth hundreds of millions of euros enter the market? Romanian construction firms have started developing as late as the last five or six years," says Bulboaca.
"At present, a contract for 3,000 square metres is a minor one. This is why I'm afraid we will end up working for foreign companies or for foreign contractors. I do not think it is fair on behalf of the Romanian authorities not to take into account the fact that Romanian companies are just developing," mentions Bulboaca.
Another problem for Romanian constructors is the labour force, especially the skilled one. Romanian workers' migration to developed countries such as France, England, Italy and Spain has visibly affected the business of the Romanian companies.
At present, there are no more specialised schools for the construction field, according to Florescu. People working in the construction industry get some of the smallest wages in Romania, with a net monthly average of 195 euros per month in April, while the net average wage per economy stands at 230 euros. The increase in orders and business development in construction has not translated into wages.
On the other hand, the Arcom representative considers that Romanian companies lacking financial power should not secure major infrastructure contracts because they do not have sufficient capacity to finalise the projects.
Romanian construction firms
Need to invest massively to be able to compete with the foreign firms operating on the domestic market
Are hurt by the new law on acquisitions that allows foreign firms to win important contracts easier
Are just developing and therefore are put at a disadvantage by the fact that turnover is taken into consideration when a contract is awarded
Are also faced with the problem of the labour force migrating to developed countries.
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