Three-quarters of business leaders in Romania (75%) believe that the reforms and investments made through the National Recovery and Resilience Plan (PNRR) will contribute to the competitiveness of the local economy over the next five years, supporting local businesses in transitioning to more efficient and sustainable operational models, according to the Deloitte study "Futureproofing Europe: How the Next Generation EU programme is inspiring companies to transform," conducted among nine EU member states.

The study also highlights the above-average level of awareness among surveyed Romanian executives (41%) regarding the objectives and intervention areas of the plan. Moreover, Romania ranks among the states with the most companies interested in participating in tenders for PNRR projects, with 5% in 2023, compared to the EU average of 3%, according to the study.

Innovation, digitalization, and sustainability are the strategic directions targeted by the NextGenerationEU (NGEU) fund, accessed by member states through national PNRRs, and companies in the EU are taking advantage of the opportunity to update their strategies, the study further indicates.

Thus, over a third of them (36%) state that they have reconsidered their innovation strategy since the adoption of NGEU by the European Commission (2020), 40% their digitalization strategy, and 31% their sustainability strategy, also showing that they feel encouraged by the fund and PNRR to increase investments in the "green" transition.

Companies in Romania rank above the average in each of these chapters: 37% state that they have revised their innovation strategy in the last 24 months, 50% their digitalization strategy, while 61%, the highest percentage among the participating states in the study, declare that they will increase investments in sustainability under the influence of PNRR.

"The €800 billion available under the NextGenerationEU fund creates direct and indirect opportunities perceived by business leaders in the European Union, including those in Romania, which drive them to update their strategies in this recovery period following the successive shocks of recent years. In fact, 62% of the executives surveyed say that similar support mechanisms to NGEU will be welcome even after 2026, in the event of new episodes of systemic instability, while 57% believe that funds attracted by states through national plans will simultaneously mobilize a significant increase in private investments in the community space. The European business environment expects more direct support from the EU in the future, in the form of grants and subsidies for entrepreneurs (72%), and feels the need for faster and less bureaucratic decision-making mechanisms (44%), better alignment of involved institutions (40%), and better capacity to reconcile some divergent interests of member states (37%)," said Alexandra Smedoiu, Tax Services Partner, Deloitte Romania.

Companies from the countries most affected by the pandemic and the energy crisis, Germany and Italy, have expressed the most enthusiasm regarding the European Commission's initiative to create NGEU and the scope and opportunities brought by the fund in general, with 72% and 64% of respondents, respectively. Romania falls into the more moderate area, with a favorable perception of NGEU among 53% of respondents, similar to states like France (55%) or Finland (51%).

"Romania is among the states with the highest percentage of NGEU allocations as a percentage of GDP (12%), according to European Commission data, which motivates the private sector to examine and access various opportunity areas; hence the above-average percentages revealed by the study regarding interest in tenders from PNRR or the level of familiarity of Romanian business leaders with the objectives and directions of the plan, but especially the percentages related to the influence of PNRR on projects in the digitization and sustainability areas. An influx of resources the size of that in NGEU, with tranches conditioned on performance criteria, also requires constant processing capacity at the national level, both in the public and private sectors, and persistent realities, such as inflation or blockages in supply chains, affect the smooth conduct and compliance with deadlines for projects and contract award procedures," said Adrian Coman, Senior Managing Associate, Reff & Associates | Deloitte Legal.

In the event that NGEU or a similar program were to continue after 2026, business leaders believe that the main areas of intervention should focus on sustainability and the "green" transition (51%), innovation and digitalization of businesses (49%), future skills development (30%), and providing tangible support to companies, especially SMEs and startups (28%).

The Next Generation EU fund is a support package launched by the European Commission to assist the economic recovery efforts of member states following the crisis caused by the COVID-19 pandemic. The instrument has a value of around €800 billion, funds that states can access through national PNRRs, and is operational between 2021 and 2026.

The Deloitte study "Futureproofing Europe: How the NextGenerationEU programme is inspiring companies to transform" was based on a survey conducted in 2023 among 1,000 leaders and executives from private companies in Belgium, Finland, France, Germany, Italy, the Netherlands, Portugal, Romania, and Spain. (Photo: Freepik)