EY Survey: 72% of Investors See Grants as Key to Investing in Romania

A total of 72% of investors consider the availability of non-repayable grants to be a decisive factor in choosing a country to invest in, according to the EY Attractiveness Survey Romania 2024. Both the availability and absorption of non-repayable funds are part of a series of essential indicators that shape a country’s investment landscape, and Romania stands out in this field due to the diversity of state aid programs and EU funds dedicated to supporting investments.

The availability of cash grants gives Romania a competitive edge, considering that other countries in Central and Eastern Europe typically opt for a combination of repayable and non-repayable funds, along with tax incentives. While nearly half of investors mentioned that the value of available funding in Romania is higher compared to the European benchmark, the main challenge for Romania to strengthen its attractiveness in this area remains the efficient absorption of funds and maximizing their impact, particularly in less developed regions or industries.

“Last year, Romania allocated significant amounts in non-repayable funds to stimulate various economic sectors such as agriculture, green energy, innovation, or manufacturing. However, improving the absorption of these funds is still necessary to drive sustainable growth and align with EU priorities. At the same time, Romania remains one of the most attractive EU countries in terms of the availability of cash grants for private companies,” says Sebastian Popescu, Coordinator of the Grants and Incentives Advisory Services line, EY Romania.

“Investors need to focus on ensuring that projects are designed to meet the criteria of the relevant scheme in order to maximize their chances of securing funding. With billions of euros available to Romania through EU programs, the PNRR, and state aid, the challenge is not the availability of non-repayable funding but the ability to develop enough bankable projects to utilize this type of financing,” says Peter Latos, Strategy and Transactions Leader at EY Romania.

“Non-repayable funding is essential for expanding and modernizing local and regional infrastructure, given the large volume of investments required for the population to benefit from public services at European standards. For example, in the water sector alone, around 25 billion euros are needed to comply with European regulations. Therefore, it is necessary to efficiently utilize non-repayable funds in addition to attracting other sources from the private sector,” adds Venera Vlad, Associate Director at EBRD.