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Romanian entrepreneurs say fiscal, regulatory environment worsens - EY study

Romanian entrepreneurs say fiscal, regulatory environment worsens - EY study

BUCHAREST (Romania), March 12 (SeeNews) - Some 52% of Romanian entrepreneurs feel that the domestic fiscal and regulatory environment has deteriorated in the course of 2018, the results of a new study showed on Tuesday.

In their view, the main three measures that the government could take in order to improve the fiscal environment would be to reduce labour taxation, combat bureaucracy and maintain stability and predictability, according to the 'Startup Barometer' study compiled by EY Romania, Impact Hub Bucharest and Startarium. Only 20% of entrepreneurs feel that the fiscal environment has improved.

The study also showed 50% of start-up entrepreneurs are planning to expand their businesses on new markets. Most of them, 51%, eye other European markets, while 17% plan to take their businesses to the US.

Fear of failure is among the main obstacles for those who want to start and develop a business in Romania, according to 20% of polled entrepreneurs. Poor education, fiscal unpredictability and the current political situation are also mentioned as obstacles by most entrepreneurs.

Also, some 74% of respondents believe that entrepreneurship is not supported by Romanian society.

"Romania has a fantastic chance to develop an essential competitive advantage, that of innovation, especially in technology. And the expectations are great for the new generation, but also for the government, to support this extremely positive trend, " EY Romania business support department partner Cristian Carstoiu said.

Concerning business development, entrepreneurs feel the main obstacles they face are the lack of capital for investment (45%), a limited promotion budget (38%) and the need for new customers whom they do not know how to address (34%).

According to the study, the average monthly personal income of an entrepreneur has dropped to 917 euro ($1,033 euro) this year, compared to slightly over 1,000 euro in the last study compiled in 2017. Also, the percentage of those whose monthly earnings are lower than 500 euro is up 15 percentage points compared to 2017.

Most entrepreneurs (79%) still use their own funds to finance their businesses. European funds are a second major source of funding for 11% of entrepreneurs, while 16% relied on funds provided by the Romanian state under the programs specific to SMEs.

The third edition of the Start-up Barometer in Romania analyzed  responses of 284 entrepreneurs with businesses located mostly in the urban area, active in IT&C, retail, business services, media and advertising, food industry, education. Interviews were performed between January 15 - February 17 2019.

EY is a professional consultancy services provider with 260,000 employees in over 700 offices in 150 countries.

In Romania, EY is present since 1992 and provides integrated audit, tax assistance, transaction assistance and business assistance services to multinational companies and local. EY has offices in Bucharest, Cluj-Napoca, Timisoara and Iasi, and employs over 800.

Impact Hub Bucharest supports entrepreneurial development of initiatives that have a positive impact on society. Present in Bucharest in 2012, the organization is part of the global Impact Hub network with physical presence in over 100 locations across 5 continents.

Startarium is a platform for start-up entrepreneurs launched in 2016 which provides access to all resources needed to launch and grow a successful business.

($=0.8875 euro)