The European Union has been hammered by the global recession that began in 2008.
The recession has bit particularly hard into the EU’s newest members, the Central and Eastern European nations that were either under soviet hegemony or worse, part of the Evil Empire (Estonia, Latvia and Lithuania.)
So, where are investors to make a euro in such uncertainty?
Well, for astute investors looking at renewable energy in the EU, one of the hottest bets right now is – Romania.
Yes, THAT Romania, beloved of Hollywood for Dracula films, more recently for being the film site for “Borat.”
On 28 February Romanian Environment Minister Laszlo Borbely told a conference in the capital Bucharest that the nation would seek to increase its wind power generation from its current level of 800 megawatts to 1,400 megawatts by the end of 2012 for an impressive increase of 57% in a year.
Romania’s attractiveness as a potential site for renewable power generation has received the imprimatur from London-based Ernst & Young, one of the largest professional service firms in the world and one of the "Big Four" accounting firms, along with Deloitte, KPMG and PricewaterhouseCoopers.
In its latest Country Attractiveness Indices report, which analyzes the 40 most attractive countries in terms of domestic market for renewable energy, infrastructure and compatibility with individual technologies, Ernst & Young ranks Romania alongside Poland and Ireland in terms of the attractiveness of wind energy market and very close to more advanced European nations like Sweden and fellow EU members France and Italy.
The Ernst & Young General index, which ranks all categories of renewable energy, including wind, solar, geothermal and biomass, rates Romania 13 among the 40 countries surveyed as regards the local market attractiveness for the development of renewable energy projects.
The Ernst & Young evaluation should give investors pause, as the company has 152,000 employees in 140 countries last year generated approximately $22.9 billion in income. Seeing gold where others saw chaos, Ernst & Young was one of the first major European companies to enter Romania in its first full year of independence from communist rule, 1992. Ernst & Young now has over 450 employees in Romania and in the neighboring Republic of Moldova, a former Soviet state that also speaks Romanian, which was sliced off of Romania by Stalin shortly before World War Two.
On the plus side Romania, as an (albeit relatively new) member of the EU, is constantly seeking to harmonize its national legal structure with EU existing legislation.
Corruption, which infects virtually all of the post-Soviet space.
But progress is being made. In its 2010 report on worldwide corruption, Global Integrity reported, “Because of its compliance with EU accession mandates, Romania earns a sparkling rating for its overall legal framework in combating corruption.”
As a caution for the future the Global Integrity document added in the next sentence, “However, the implementation and enforcement of that legal framework leave much to be desired.”
Cautioning those investors who might rush in the report added, “The ombudsman office has very weak investigatory and prosecutorial powers, while law enforcement – a perennially problematic institution in Romania – is often politicized: ‘appointments are sometimes made not necessarily according to official rank and professional criteria, but to party loyalties.’”
Such insights should not be dismissed lightly, as Global Integrity, is an independent, nonprofit organization tracking governance and corruption trends around the world using local teams of researchers and journalists to monitor openness and accountability has seen its reporting not only used by the world’s media but by such international heavyweights as the World Bank, USAID, the Millennium Challenge Corp. and other donor agencies.
So, you pays yer money and take yer chances.
For those without access to Ernst & Young’s not inexpensive report, it might be noted there that the Ernst & Young English-language article on Romania’s Agentia Nationala de Presa AGRESPRESS website, Romania’s national news agency, has been as of 29 February viewed a grand total of 63 times.
Sometimes some of the most interesting tidbits for hardy investors are not solely generated by high priced sources in Manhattan and the City of London.
Do your homework.
By. Dr. John C.K. Daly of Oilprice.com