THE DETERRENTS OF THE FOREIGN DIRECT INVESTMENT ATTRACTION IN ROMANIA
THE DETERRENTS OF THE FOREIGN DIRECT INVESTMENT ATTRACTION IN ROMANIA

Author(s): Sebastian Tocar
Subject(s): Politics / Political Sciences, Social Sciences, Economy
Published by: Editura Universităţii »Alexandru Ioan Cuza« din Iaşi
Keywords: FDI; Foreign Direct Investment; Investment Attractiveness Index; Romania; deterrents;
Summary/Abstract: The economic results of developing countries are largely determined by the fulfilment of their potential of attracting foreign capital. Similarly to all post-communist countries, it is also the case of Romania. The Romania’s volume of foreign direct investments per capita is among the lowest in the region, and identifying the factors that have determined these results could provide a more effective strategic orientation of the policies related to the attraction of foreign investments. The author took the Culture specific Investment Attractiveness Index (IAI) as a basis for the identification of the factors that impede the attraction of FDI in Romania. This index was elaborated in a previous study and is based on 20 indicators representing six categories of FDI determinants: economic factors, technology, infrastructure, institutional political factors, the human factor and cultural factors. In the case of this index, considering the impact of cultural factors is very important, because they are often neglected. The analysis of the scores for the elements of this index resulted in the identification of the deterrents that impede the attraction of FDI in Romania, but also of the strengths of Romania in the attraction of foreign capital.

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