Cezar Coraci, chairman of the General Union of Romania's Industrialists UGIR 1903, says the lack of a skilled workforce, the high indirect costs of business and the instability of the fiscal system are the main problems industrial companies have to face.
Coraci believes the Romanian economy could be even more competitive in the EU if it bet on the development of some branches such as the agro-food industry, the chemical and petrochemical industry, the car industry, constructions, IT, furniture production and consumer goods.
"These are branches that are well rooted in Romania, where there are raw materials, technology and a market demand," explains Coraci, adding there is a lack of some clearly defined objectives for each branch and strategic decisions for industrial development.
Statistical data shows industry workforce productivity rose by 8.7% in the first quarter of the year against the same period in 2007. The chairman of the UGIR 1903 says the trend of productivity needs to be correlated with industry wages.
"We know that we'll have to further increase wages above average labour productivity, which is economically unhealthy," states Coraci.
In March, the net average wage in industry reached 1,089 RON, up 13% compared with the same period of last year.
"Productivity is following an upward trend that will continue. However, I do not believe we'll catch up with Europe's most developed countries in the next 10 years," adds Coraci.
He believes the fast growth rate of foreign investments can be sustained through lower corporate taxes. "The indirect costs of a business in Romania are starting to get higher compared to anywhere else in Europe," says Coraci.
One of UGIR 1903's plans is to set up negotiations for labour conflicts at a branch level.
The domestic problems the industry is experiencing also include a shortage of skilled personnel. However, as wages increase, the domestic market will become ever more appealing for workers from less developed countries, as well as for Romanian workers who went abroad to find better paid jobs.
UGIR 1903 includes over 60 federations and employers' organisations. The biggest Romanian companies part of UGIR 1903 include Rompetrol, Dacia, Petrom, Mittal Steel Galati, Mechel Targoviste and European Drinks.
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