Romanian tourism - Long-term investment in pure nature and history

8 Noiembrie 2011

BANCA COMERCIALĂ ROMÂNĂ S.A.

Romanian tourism: Looking ahead

More foreign tourists, more tourism activity; with one of the highest potentials in tourism in the region (natural landscape and biodiversity), Romania is pretty slow in attracting foreign visitors, who spend 12 times more on average than resident ones.

More FDIs, more know-how, better services; this will lay the foundations for a wider base of foreign tourists and longer holiday stays in tourist facilities in Romania.

More investments, higher income in the balance of tourism, improved performance of the C/A; organic investments combined with foreign capital in tourism could generate additional inflows in the balance of tourism estimated at up to EUR ~1-1.5bn in 2016.

More and better road infrastructure, easier access to local tourist attractions; both coverage and quality should be developed so as to bring road infrastructure closer to the European benchmark; road transportation prevails when travelling from one destination to another.

Higher education, better grasp of today’s tourism realities; employment education is an important asset for tourism industry; primary education holds an important share in total employment in Romania; possible negative impact on the quality of service and travelling conditions for foreign tourists.

Continuation of well-focused marketing campaigns, higher position of Romania on tourist map; promoting Romania’s image abroad has started to pay off and the number of foreign arrivals in our country rose 11% y/y in the first seven months of 2011, while gross inflows in the balance of tourism were up 16% y/y during January and July.

Insufficient FDIs in tourism stripped Romania of potential wealth

Romania came third in terms of FDI inflows in tourism during 2005-2009 with around EUR 186mn; Bulgaria was in a much better position, raking in more than EUR 450mn during the same period, which shows a greater propensity towards this particular area of activity.

Romania is the only country within the group that posted a negative aggregateincome in the balance of tourism 2006-2010; Croatia is a top dog, earning almostEUR 30bn in only five years; under similar conditions, the C/A deficit of Romania 2006-2010 would have stood at less than 4% of GDP instead of ~9%.

Tourism profile varies from one country to another

The vast majority of foreign tourists visiting Romania come to spend their holiday

Austria, Croatia and the Czech Republic have by far the highest check-in rates for foreign visitors; ~5 times more foreign tourists put up at a hotel in Croatia than in Romania, which is closer to the numbers reported by Slovakia and Bulgaria.

90% of the foreigners come to spend their holiday in Romania, which is more or less the case for Hungary; at the other end of the scale, Poland holds a highershare of foreigners coming for business purposes (>22%), which could mean thatthat country is a preferred business destination.

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