Romania continues to be attractive to foreign investors due to its geographical position, membership in the EU and NATO, well-prepared workforce, and competitive salaries. However, the business environment is affected by frequent changes in legislation, lack of predictability, bureaucracy, and the limited capacity of the administration, as shown by the US State Department in the report on the investment climate in Romania for 2026.
The document indicates that changes in government coalition priorities and fiscal consolidation measures have reduced predictability for investors.
The report is part of the annual series of Investment Climate Statements, through which US authorities analyze investment conditions in over 170 countries and economies.
Unpredictable Legislation and Limited Administrative Capacity
The State Department highlights one of the long-standing issues raised by the business environment. "Legislative and regulatory unpredictability, as well as limited institutional capacity, continue to negatively impact the investment climate," the report states.
Special attention is given to the energy sector, described as vulnerable to frequent and unexpected legislative and fiscal changes.
Issues also arise in how regulations are adopted. Romanian legislation requires public consultation for draft legislative acts, but the report indicates that these requirements are sometimes bypassed.
The State Department also cites the European Commission's 2025 Country Report, which warned that frequent changes in fiscal and regulatory matters could hinder investments.
Frequently Modified Taxes
Another sensitive point is the tax legislation. "Tax legislation is frequently revised, often without evidence-based impact assessment," notes the State Department.
The issue is also reflected in company responses. According to a Eurobarometer cited by the State Department, 96% of Romanian business people surveyed indicate that tax levels are among the biggest challenges in conducting business.
For 91% of respondents, a problem is posed by rapidly changing legislation and policies, while 84% point out the complexity of administrative procedures.
Corruption is mentioned by 72% of respondents.
Romania Attracts Investments, but the Economy Has Slowed Down
Despite the reported issues, the State Department states that Romania actively seeks foreign direct investments and offers several advantages to investors. These include its strategic position on the Black Sea, membership in the EU single market, NATO membership, an educated workforce, competitive salaries, and natural resources.
However, the report also highlights the economic slowdown. Economic growth was below 1% in both 2024 and 2025, while inflation rose from 5.6% in 2024 to 7.3% in 2025.
In this context, measures to reduce the budget deficit and changes in political priorities have added uncertainty for the business environment.
European Funds Hindered by Bureaucracy and Staff Shortage
The report also focuses on European funds, which represent one of the main sources of financing for investments and modernizing the Romanian economy. "The absorption and implementation of EU funds continue to be hindered by staff shortages, limited administrative capacity, cumbersome procedures, and difficulties in securing private financing," the document states.
Workforce, an Advantage Starting to Face Issues
The State Department describes Romania as traditionally having "a large and skilled workforce, with generally excellent English language proficiency and comparatively low salaries in most sectors."
However, the situation has changed in some fields. "The labor force supply has decreased in highly skilled professions, especially in the IT and healthcare sectors, due to emigration and an uneven primary and secondary education system," notes the report.
The document estimates that approximately 2.4 million Romanians live and work in other EU states.
The State Department also observes that "the Government lacks a comprehensive strategy to address the labor force deficit," although measures have been taken in recent years to attract and retain qualified personnel.
The fiscal burden on labor costs is estimated at around 42.8%, exceeding the European average of 38.6%.