A significant share of the record-high profits posted last year by the largest Romanian companies went into the foreign accounts of their majority shareholders, whilst foreign investments underwent a dramatic fall.
Mobile telephony operators Orange and Vodafone, the largest banks on the market - BCR and BRD, as well as the three cement producers Lafarge, Holcim and HeidelbergCement, sent back home around one billion euros, according to ZF calculations.
This is in fact the cost of the foreign investments, which had supported the growth of the economy, created jobs and sustained salary raises until last year, but which now, in full economic crisis, have a negative impact on the current account deficit.
"Fund repatriation comes as a natural consequence of the foreign investments made in the past few years and has a negative impact on the current account. However, amounts repatriated nearly halved in the first half of the year, to 2 billion euros, compared with 4 billion euros in the same period of 2008," says Melania Hancila, chief economist at Volksbank.
Mobile telecommunications company Vodafone Romania will transfer its entire 2008 net profit, worth 1.128 billion RON (306.2 million euros) in form of dividends to its majority shareholder, British group Vodafone.
"The payment of dividends is made on a monthly basis, with a maximum cash sum of around 25 million euros being required to remain in the company's banking accounts," according to the May decision of the General Meeting of Shareholders, published in the Official Gazette on Wednesday.
Orange, which last year posted the largest profit in Romania, 438 million euros, has yet to publish decisions on profit distribution, but, according to market sources, the company disbursed around half its profit in form of dividends.
Orange is part of the France Telecom group, one of the world's largest telephony operators. Orange representatives did not answer ZF questions.
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