Romania is one of the most attractive places in Europe for foreign direct investments (FDI), according to a new survey by consultancy firm Ernst & Young. The country ranked sixth, behind only Germany, Poland, the UK, Russia and France and outranking the Czech Republic, Turkey, Switzerland and the Netherlands.

However, Germany came out as the clear favorite. When asked, 35 percent of investors said Germany was Europe's most attractive country for investment, compared to 10 percent for Poland, 8 percent for the UK, 7 percent for Russia, 4 percent for France and 3 percent for Romania.

“Romania has the advantage of promising growth rates of GDP compared to the European average and valuable human capital. We see more and more investors attracted by the renewable energy sector. More privatizations are planned in the future, encouraging investors worldwide to look to our country. It is essential to stimulate this positive development through appropriate economic strategy,” says Ernst & Young Romania Managing Partner, Bogdan Ion.

The report, which looks at Europe and her attractiveness for FDI, finds that despite the economic problems, Europe's charms can still seduce the foreign investor. The total number of projects increased in 2011 and is above the pre-crisis level. The average value of projects increased, meaning that although growth in the total number of projects was modest, the increase in cash was significant. The number of jobs created in Europe by FDI was also well up in 2011: a 15 percent increase on the previous year. The US leads FDI in Europe, with 26 percent of the total, while looking at industry sectors shows that professional services and software production still receive the most FDI, with increases of 19 percent and 15 percent respectively in 2011.

Central and Eastern European countries are attracting the majority of FDI in manufacturing. The report found, perhaps surprisingly, that perceptions on Europe as a place for investment remain very positive. Western Europe is considered the second most attractive place to invest after China and Central and Eastern Europe comes out third. There is also widespread confidence that Europe will overcome its economic difficulties; 81 percent of respondents believe Europe will overcome the current problems.

Liam Lever, liam@romania-insider.com