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Speeches, 9/5/2007

The Address by Minister Väyrynen at the Finland-Romania Business Forum in Bucharest

Keynote address by Dr. Paavo Väyrynen, Minister for Foreign Trade and Development of Finland, at the Finland - Romania Business Forum in Bucharest on September 5, 2007.

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Your Excellency, State Secretary Imre, Excellencies, Ladies and Gentlemen,

I would like to start by thanking the Chamber of Commerce and Industry of Romania for co-organising this event. And I would like to thank State Secretary Imre for his interesting and inspiring address.

Ladies and Gentlemen,

It is a pleasure for me to visit Bucharest accompanied by a high-level Finnish business delegation. This is the second stop during my first business promotion visit abroad in my capacity as the new Minister for Foreign Trade and Development of Finland. This proves that the important strategic position and economic potential of Romania have been duly recognised in Finland.

The purpose of my visit is to enhance trade and economic relations between our two countries. It is actually easy to find the way from Helsinki to Bucharest by orienteering straight to the south. When our national airline Finnair has started direct flights between Finland and Romania this year, the journey is easier than ever before. This logistical improvement will certainly help our mutual business and all other human contacts.

Ladies and Gentlemen,

My visit to Romania takes place at a time where innovative responses to the challenges - and opportunities - created by globalisation are in high demand everywhere. Globalisation has brought the different corners of the world closer to each other and made new kind of interaction possible.

On the other hand, this process has made all of us begin to face the limitations that increasing economic activity on a global scale brings about. Typically, relocation of businesses and jobs towards a few large rising economies - China in the first place - has been seen as the primary expression of globalisation. This has been felt in Finland, as well, but this is not the end of the story.

Rapid economic growth in Brazilia, Russia, India and China has entailed intensified rivalry for raw materials and energy around the globe with the consequence of ever-rising prices of these productive assets. And all this constitutes an increasing burden on the ecological sustainability of this global development. So, the name of the game is to balance the opportunities created by globalisation with the challenge of economic, social and environmental sustainability.

The European response to these global challenges has been the ever-gathering economic integration and the creation of a single market. We in Finland have had the honour to play a role at the turning points of the Romanian path into the European Union and the single market. In 1999, during Finland's first EU Presidency, Romania was invited in Helsinki to start the membership negotiations with the European Union. And during the second Finnish Presidency last year it was confirmed that Romania will join the Union at the beginning of 2007.

It is this common single market that is the context in which Finnish and Romanian companies search for niches and untapped business potential between themselves. I strongly believe that Romania and Finland can together gain a lot from the enlarged European Union and the internal market. Common regulatory foundation and standards within the single market make life for entrepreneurs a lot easier. And later, after that Romania has entered the Euro zone, the benefits to business relations will be even higher. I encourage the Romanian authorities to continue on the reform path and especially in the efficient implementation of the reforms.

Ladies and Gentlemen,

With trade flows between our countries growing steadily, the timing of our visit could not be better. At the moment, Finnish exports to Romania consist mostly of telecommunications technology, iron and steel, machinery and paper, our national strongholds.

Finnish investments in Romania are also increasing, and Finnish companies have already attained a promising foothold in Romania: there are some 60 Finnish companies operating in this country. The on-going investment project in the city of Cluj Napoca driven by Nokia together with its suppliers represents the biggest green-field foreign direct investment in the history of Romania. Also some other Finnish companies are currently realising major manufacturing investment here. For example, Rautaruukki has invested in a new construction material production site in Romania.

Where is then that untapped business potential between our countries to be found that I referred to earlier? We should look at our respective strengths - the different aspects that make our respective markets attractive.

Romania has many undisputable trumps in view of increasing trade and investment from Finland: Romania has a large domestic market of some 22 million people. Its economic growth has been positive in the past years and inflation has decreased. Furthermore, you can count your favourable geographical location as a bridge to the surrounding regions, availability of skilled labour force, competitive production costs, and favourable taxation, among other things, as your clear advantages.

I would like to compliment Romania on her constructive role in fostering regional co-operation in the Western Balkans. For instance, Romania played a crucial role in supporting the establishment of the renewed Central European Free Trade Area (CEFTA), which was established in Bucharest on December 19, 2006, during the Finnish EU Presidency. Romania has also actively contributed to the transition of the Stability Pact for South Eastern Europe into the Regional Co-operation Council.

The accession of Romania into the European Union has brought about new geographical dimensions as the EU has opened up to the Black Sea. The Western Balkans is now surrounded by EU States, and there is also a new neighbour in the East, the Republic of Moldova. Romania and Finland have common interests also in the sense that Romania has, after Finland, the second longest external Eastern border of the EU-27.

The Government of Finland appreciates the active role Romania has taken in the regional co-operation. Romania has the potential to give a valuable input to promoting stability and well-being in the Black Sea area. This is beneficial from the business angle, as well. The European Neighbourhood Policy (ENP) provides a central framework and instrument for these endeavours. I hope that the EU's Northern Dimension Policy as well as the co-operation in the Baltic Sea region can offer useful experiences and ideas to be built on in the cooperation in the Black Sea region. The active role in the regional co-operation combined with the quickly developing economy makes Romania and Romanian companies important business partners in the Black Sea and the Balkan region.

Ladies and Gentlemen,

The overall image of and knowledge about the country play an important role in international investment decisions. The predictability of the business environment and beneficial social and economic development are of importance. This is especially true for smaller companies which are less eager and able to take risks. While welcoming big investors, it is good to remember that small companies may turn big in the future and that SMEs provide most jobs in all countries.

There are many promising sectors for more intensive trade and investment links between our countries. for example, traffic infrastructure, modernisation of energy transmission networks in industrial and power plants, environmental technology, water management and forestry. On my business delegation, there is high-level Finnish know-how in these sectors - and many others - present here today.

Ladies and Gentlemen,

As I wrote in my message in the business delegation brochure, commerce is a two-way street, and I believe that Finland is an increasingly interesting trade and investment destination for Romanian companies, as well.

The Finnish economy is today in good shape for international business. Last year our GDP grew at the rate of 5,9 per cent - almost as high as in Romania. Finland continues to rank among the top countries in the world in economic and business competitiveness as well as in environmental sustainability. Luckily and as a result of clever governmental and private sector decisions, Finland has now three "legs" to maintain its economic success story: forest sector, metal and engineering and,  as the latest one, high technology. Telecommunications equipment is today our number one export item.

The key to the Finnish success story has been investment in education, research, development and innovation. Investment in R&D in Finland - 3,5 per cent of the GDP - is one of the highest in the world. The share of the private sector in R&D investment is more than 70 per cent today, but it was the Government, which initiated the process in the1980´s with big public investments. Finland has had the best ratings in the OECD´s comparison of the quality of education. And our administrative system is also ranked one of the best in the world. Finland has had the best ratings in Transparency International´s Corruption index. The very close communication and co-operation between the public and private sector and various interest groups is the key of the Finnish openness and transparency. We have been happy to share the Finnish expertise and experience of anti-corruption activities through a successful twinning project in this field in Romania.

Ladies and Gentlemen,

I would welcome a rising number of Romanian businesses to Finland to benefit from our excellent business environment and the technological know-how that can complement your current supply in the world markets. The increasing knowledge about Romania in Finland hopefully contributes to strengthening Romanian business presence in the Finnish market.

In conclusion, Ladies and Gentlemen,

I would like to wish you productive business-to-business encounters at this Forum and all future success in your businesses. Thank you.

This document

Updated 9/5/2007

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