Romania will be benefiting EUR 1.5 bln of European funds in 2008, according to the Secretary of State of the Ministry of the Economy and Finance (MEF) Eugen Teodorovici. To date, Romania has received EUR 2 bln in European funds according to the secretary of state.

Transport and environment infrastructures are the main areas where the funds are to be directed to.

The EUR 1 bln national financing for the Cernavoda-Constanta, Lugoj-Arad motorways and Constanta ring road will be replaced by EU funds. said the MEF official. The three projects are of an estimated value of 2 billion euros half of which coming from the European Investment Bank and the other half from Romanian state contribution.

Also, the Ministry of Economy is holding talks with European Bank for Reconstruction and Development (EBRD) representatives on setting up a fund to finance projects implemented by the local authorities. The whole idea is that this fund should be backed by commercial banks with financing and by the Romanian state. For now, the MEF, Eugen Teodorovici is having talks with the EBRD on how to eventually operate these funds and the procedures governing the allocation of those sums.

According to how fast the talks to EBRD go, the conditions under which the new fund would be created might be agreed on before the end of this year.

Romania is still ‘the undiscovered Europe’ with demand outstripping supply in many property sectors, according to the latest analysis of the country.

EU membership, a growing number of tourists and rising numbers of property investors have all helped to make the first half of 2008 a good year for the real estate sector.

Also the growth of multinational companies such as GE and Proctor & Gamble has already pushed up the attractiveness of Bucharest in the buy-to-let market.

The commercial sector is booming because of soaring demand for modern office buildings, according to the 2008 real estate market overview report from CB Richard Ellis.

‘The demand for office space is driven by the auto industry, financial institutions, retailers and IT and telecoms. Vacancy rates in the office sector are below an overall rate of 3% with only 1% for premises considered to be Class A,’ the report says. (more…)