If the absorption rate remains at a monthly 0.5 percent, Romania would need 15 years to absorb the funds for 2007-2009, considering that the total structural and cohesion funds allocated by the European Union for 2007-2013 exceed €19 bln. However, given that most of the money was absorbed in 2009, the situation will improve, consultants and authorities say.
“The number of financing contracts surged in 2009, and progress was registered in implementing projects. The upward trend will continue in the near future,” said Stefan Ciobanu, General Manager of ACIS.
In October, 506 projects were submitted and a further 125 were approved. Financing contracts were signed for 147 projects. Overall, Romanian enterprises and authorities have so far submitted 13,481 projects, of which one third were rejected. The large number of rejections is due either the fact that beneficiaries do not know how to design a project, or because evaluators are not well prepared and often give contradictory marks on the same file.
Moreover, considering that the evaluation of the project can take up to nine months, as the market situation changes on a monthly basis, many enterprises submitting projects give them up later. Bureaucracy and difficult access to lending led 25 percent of structural fund applicants to abandon their projects, said Peter Barta, Chief Executive Officer of the Post Privatisation Foundation, a Romanian apolitical and not-for-profit legal entity meant to financially support Romanian small and medium-sized enterprises (SME).
