In 2023, 10 Wingate events brought together over 450 representatives of the local business ecosystem. The 10 cities where they took place provided an opportunity to disseminate the project’s values, centered around the need for continuous education and a proactive approach to networking as a solution for sustainable scaling. It was also an occasion to deeply analyze the developments and challenges of the entrepreneurial development in 2023.
The outlook for 2023 was viewed with concern by more than half of the managers attending the Wingate events, given the inflation, decreased investment appetite, and financial blockages. Most believe that businesses are operating on “very thin ice.”
The risk of insolvency is increasing as consumption, which is the main driver of the economy, continues to be affected by decreased purchasing power and limited access to credit, according to the study respondents.
Inflation has climbed to the second place among concerns for Romanian entrepreneurs. In addition to declining businesses and inflation, they are also worried about increasing financial blockages and rising financing costs, including expensive and limited access to credit.
“Inflation has had a significant impact on the economy, and its second-round effects will be visible until the end of 2023, when business dynamics could enter a negative trend, especially due to investors’ confidence in the economy,” said Cristina Chiriac, President of the National Association of Entrepreneurs, Founder of Flori de Ie.
“After two years of the pandemic and a year of strong inflation, 2023 is the year when we will face all the accumulated economic imbalances from this period. Business restructuring is a priority, and optimizing production and sales flows in line with demand evolution and new digital tools will be the general characteristic of an economy dealing with financial frost,” added Cristina Chiriac.
Restructuring businesses are at the center of attention for 2023. Investors need to focus on reorganizing operations following the decline in consumption and the intensification of disintermediation, after a 2022 where the business environment was primarily focused on stimulating consumption following two years of the pandemic.
“A state of complete uncertainty” is the sad conclusion after managers hoped for a consumption recovery post-pandemic but were disappointed by the effects of inflation, which affected purchasing power and disrupted economic chains, especially due to increased production costs, particularly in the energy sector (electricity, gas, fuels), emphasized Nicoleta Munteanu, Vice President of the National Confederation for Women Entrepreneurship, Founder of Kids in Business, and a constant presence at Wingate events.
The results of the Wingate meetings show that, among the priorities for 2023, business restructuring is followed by securing business lines, mentioned by the majority of female entrepreneurs.
Only a quarter of the managers present at the meetings are relying on new investments in 2023, with most waiting to see the evolution of the local and international macroeconomic framework, given the ongoing conflict in Ukraine.
At the same time, the dynamics of businesses in 2023 will largely depend on the functioning of supplier credit, which represents the primary means of financing businesses in Romania, according to the study.
Investments and accelerated digitalization are key factors for 2023.
Most entrepreneurs believe that Romania’s economic growth in 2022 was deceptive, driven mainly by inflation rather than the development of predictable and future-oriented businesses.
According to them, the effects of inflation could provide a positive outlook in the new year, although it is only loosely associated with real economic dynamics.
While last year predicted a strong economic recovery in the first half of 2023, the perception has now shifted towards the end of the second semester when a positive reorientation of the economy could be observed against the backdrop of decreasing inflation.
According to discussions within Wingate regarding the exit from the crisis, the stakes of the Romanian economy are primarily focused on curbing inflation and attracting funds from the National Recovery and Resilience Plan (PNRR) as solutions to keep the economy afloat.
Curbing inflation and emphasizing investments could save an economically uncertain year of 2023. For the financially fragile Romanian economy, the €29.18 billion allocated for PNRR implementation, including grants worth approximately €14.24 billion and loans worth €14.94 billion, could represent a lifeline to save businesses from an increasingly evident technical recession.
“A constant dialogue between the business environment and authorities is necessary. The existence of this dialogue helps the latter stay informed about the challenges faced by the business environment and provides some predictability to it. The stability of fiscal policies and the long-term predictability of the executive’s vision on fiscal strategy give the business environment a competitive edge when local companies enter foreign markets,” said Mihaela Mitroi, President of CONAF Bucharest and CEO of Global Tax Advice.
In 2023 the Wingate project events took place on February 2nd in Bucharest, February 3rd in Buzau, February 7th in Oradea, February 23rd in Sibiu, April 5th in Bucharest, May 3rd in Ploiesti, May 9th in Buzau, June 9th in Brasov, June 14th in Bucharest, and June 20th in Giurgiu, with over 450 participants representing the Romanian entrepreneurial environment.