27 March, 2017

Romania’s economic relations with the Middle East countries

Interview published on Europunkt.ro:

1. Do you consider that there is a shift on how we define and understand the importance of economic relations with Middle East countries?

We can certainly say that there is a change in the way we approach our relations with Middle East countries. One can say that this change doesn’t happen as fast as we would like to, but we must also consider the current situation in these countries, which doesn’t favors rapid, big steps.

Romania understood that in the Middle East there are not only problems, but also opportunities and the historical relations Romania had in this region are a big plus.
Economic and diplomatic missions, which took place in the last years, including those at Prime Minister level, are proving that there is a real concern and interest for an opening towards this area.

 

2. Which are Romania’s main challenges in developing its economic relations with these countries?

In addition to increased instability in Iraq, Syria or Yemen, there is general level of unrest all over the region. The pressure of the migration wave affects Jordan and Lebanon, and in Saudi Arabia, Kuwait or the United Arab Emirates, the fall in oil prices puts a strain on the whole economic system.

Meanwhile, in this area, there is a slightly different approach in the way economic relations are built up. The political leadership is much more present in the decision making process, and it is assumed that a first contact at high level will be followed by concrete actions. Without such a support, the companies, small or large, must follow a longer and more difficult road to enter the Middle East markets.

It is also good to know that those who want to approach the very attractive markets of Qatar, Oman, Kuwait or Bahrain, must prove their capacity to carry out large and complex contracts.

 

3. Within the context of rising terrorism and human rights violations how is Romania’s foreign policy approaching the Middle East?

Romania has a long and privileged diplomatic relation with the Middle East. The fact that we are one of the few countries with a very good relationship both with Israel and countries like Lebanon, Syria or Iran says the most about the success of Romanian diplomacy in the region. Economic diplomacy has always been an essential component of these relations.

Regarding terrorism, we must admit that the efficient work of some specific institutions produced very positive results for Romania. The threats, which were not few nor minor, have been tackled before becoming manifest. This is why, Romanians should be grateful to all those who worked together and defused the potential threats.

This apparent “quietness” offers an open door for economic diplomacy. It also offers the opportunity to strengthen the political relations with the lawful regimes in the region. Romania’s political relations are in line with the European Union’s ones, and the military ones are defined by the limits imposed by NATO. It is not only Romania which benefits from a close relation with the Middle East but the whole European Union – our country has the ability to open doors which, sometimes, are difficult to open.

 

4. How was it reconsidered the economic dimension of Romania’s relation with these countries after the Arab spring events?

Arab Spring meant not only progress but also regress, especially an economic one. The economies of all countries which went through a process of democratic transformation suffered. In addition, increased tensions in the Middle East, especially after the Arab Spring, and a rise in the terrorist threat posed barriers – the most important one being an impaired freedom of travel.

The six years that passed since the first events – those in Tunisia, allowed things to settle, both politically and economically. Democratic elections took place, a new elected leadership took charge, and now it is the time for reconstruction. It is a new setup that follows the rules of market economy and international trade.

Romania’s interest for the entire MENA region (Middle East and North Africa) grew, and we already saw the effects: high-level delegations visited the countries in the region, some for the first time. In April 2014 in Israel, in May 2015 in Saudi Arabia, Qatar, Kuwait and the UAE, October 2015 in Jordan, February 2016 in Iran – and these are just to name a few. High-level visits are the ones that are paving the way for business contacts and it is the time for the Romanian companies to take the initiative. Agriculture, car industry, IT, oil industry – in all of these Romania has something to offer and there is demand on the market in the area.

 

5. Which are Romania’s strengths in relation with the Middle East countries and which are the weak points?

To get clear picture, I must underline some particularities in relation with these countries.

On one hand we have the Maghreb and Mashreq countries. With these countries, Romania had economic relations for decades. We can clearly see the effects of these relations in so many elements of infrastructure, which were built by Romanian companies. Transport infrastructure, energy infrastructure, petro-chemistry facilities, agriculture, medicine – just to name a few sectors where Romanian companies were present. In these countries there is an important institutional memory. Also, there are many diplomats who studied in Romania.

On the other hand we have the Gulf area: Qatar, Oman, Kuwait, Bahrain, Saudi Arabia, Yemen and the UAE. In these countries, the first companies to come and invest in support of the needs of local development were the US, Britain or Germany ones.

In Libya, Iraq or Syria there is the advantage of an already waken path and the disadvantage of instability and security problems.

In Qatar or UAE, where there is a very attractive economic environment, but there, the Romanian companies first they must make themselves known, and then they have to cope with the direct competition with other major players, already inserted on the market.

 

6. To what extent economic relations with the Middle East could influence Romania’s relations with the EU and NATO?

I always said that economic relations are an extremely powerful tool in support of peace, stability and success for any country.

When you work eight hours a day and you are paid for your work, you don’t think any more about “who is to be blame for my harsh life and how to punish the responsible ones”. Instead, the thoughts are about “how to secure my job” and “how to spend the money I’ve earned in a meaningful way”. Investing today in the economy brings tomorrow the need support for education and health systems.

Romania, by nurturing economic relations with the Middle East, is exporting peace and stability and this can only be in the interest of the EU and NATO.

 

7. What is to be done to improve Romania’s economic relations with the Middle East countries?

The right and desirable direction is the one of economic diplomacy, where promises must be followed by action.

In practice this means that each diplomatic mission must be prepared in due time, both with external and internal partners. When a Romanian Prime Minister arrives in a country in the Middle East, he should be able to put forward credible offers and projects. The Romanian authorities can and should be involved in supporting the economic environment in reaching towards these new markets.

Once a contract with partners in the Middle East is signed, it must be honored within the agreed terms and deadlines. If a year passes between discussions and actions, it is too much. There are always others, faster, better prepared, more eager to grab opportunities, that will be there seize the moment because we act in an environment that is no longer national or just bilateral but a global one.