Romania has 1.19 million entities, out of which 809,000 (68 percent) are commercial entities and 383,000 (32 percent) are authorized sole proprietorships, said Nikitas Konstantellos, CEO of ICAP Group, during the 8th Annual Credit Risk Management Conference in Bucharest.
He added that 8,830 entities were set-up on average each month in 2016. In addition, only 4 percent of the companies that are active in Romania have a turnover above EUR 1 million, while 0.5 percent of the firms report annual turnovers over EUR 10 million.
Talking about the economic outlook of the country, Konstantellos explained that “growth is expected to the strong in the next couple of year”.
The CEO cited the forecast of the European Commission according to which the local economy will expand by 4.3 percent this year, while next year it should fall to 3.7 percent.
The executive explained that Romania recorded a 6 percent decrease in new establishments of firms last year. There were 106,000 newly registered companies, the second smallest volume of registrations in the last 6 years, according to ICAP data.
On the number of inactive companies, there were 13,000 companies that ceased to operate in the first months of 2017, which is 51 percent less than the same period of last year.
The ICAP data further show that 20 percent of Romanian companies have a high default risk, while 39 percent of the companies have a low probability of default.
ICAP Group has 1,300 employees in six countries.