ROLE OF LOCAL GOVERNMENTS IN ATTRACTING FOREIGN DIRECT INVESTMENTS: CASE STUDY ON ROMANIA

Daniela Staicu
Additional contact information
Daniela Staicu: Bucharest University of Economic Studies

Revista Economica, 2025, vol. 77, issue 1, 25-35

Abstract: Foreign direct investment plays a critical role in Romania's economic development and integration into EU value chains. However, attracting FDI at the county level remains a challenge due to infrastructure gaps, regulatory instability, and inconsistent investment support. This study examines how Romanian local governments facilitate FDI, identifying key incentives, barriers, and strategic alignment with EU priorities such as the Green Transition and Digitalization. Using a descriptive-qualitative approach, the research involved responses from 17 local administrations, highlighting regional disparities in FDI attraction strategies. Findings suggest that counties struggle with bureaucratic inefficiencies, labor shortages, and inadequate transport infrastructure, deterring potential investors. While local governments seek to enhance investment conditions through fiscal incentives, improved public services, and industrial park development, their efforts are often hindered by limited coordination with central authorities. The study underscores the need for a comprehensive "Made in Romania" strategy, stronger public-private collaboration, and targeted public investments to enhance competitiveness. It calls for further multi-stakeholder research to assess local FDI policies, streamline administrative processes, and align regional development strategies with EU industrial and economic policies. These findings provide insights for policymakers aiming to strengthen Romania s position within the European investment landscape.

Keywords: Foreign Direct Investment; Local Administration; Investment Incentives; EU Value Chains; Economic Development (search for similar items in EconPapers)
JEL-codes: F63 G10 H83 R50 (search for similar items in EconPapers)
Date: 2025
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://economice.ulbsibiu.ro/revista.economica/archive/77103staicu.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:blg:reveco:v:77:y:2025:i:1:p:25-35

DOI: 10.56043/reveco-2025-0003

Access Statistics for this article

More articles in Revista Economica from Lucian Blaga University of Sibiu, Faculty of Economic Sciences Lucian Blaga University of Sibiu, Faculty of Economic Sciences Dumbravii Avenue, No.17, postal code 550324, Sibiu, Romania. Contact information at EDIRC.
Bibliographic data for series maintained by Eduard Alexandru Stoica ().