Cluj-Napoca Confirms its Status as Silicon Valley of Europe

Cluj-Napoca, Romania has recently been tipped as one of the world's best places for Business Process Outsourcing (BPO). The international audit and tax advisory network, KPMG, revealed in its Exploring Global Frontiers report (February 2009) that Cluj-Napoca offers a favourable business environment, access to a good supply of talent, a high quality of life and lower business costs, all essential requisites for companies planning to outsource.

Along with cities such as Buenos Aires and Brisbane, Cluj-Napoca is seen as a particularly attractive outsource location when it comes to the IT industry. The availability of skilled workers is essential and Cluj-Napoca with its large student population (the biggest in Romania) offers a local talent pool of qualified personnel. The local population also has the advantage, according to KPMG, of being multi-lingual, a priority for companies looking at BPO outside their home country.

Cluj-Napoca and Cluj County are already known as Europe's ‘Silicon Valley' with around 245 IT companies operating in the county including 100 software businesses in the city itself. Along with Brasov, Cluj-Napoca is Romania's main second-tier city for IT-BPO after Bucharest, and Cluj-Napoca with its highly skilled work force and superior quality of life is seen as an attractive alternative to the capital.

Infrastructure in the city is currently being upgraded and substantially improved. Among the infrastructure improvements, KPMG highlights the network of 64,000km of optical fibre under development, the 84,000m2 additional ‘A category' office space built in 2008 and the forthcoming construction of the 26-storey Sigma Tower due for completion in 2010.

With Cluj-Napoca at the forefront, Romania has become Europe's fastest-growing outsourcing hub, both for the IT industry and for electronics manufacturing services, and the country offers some of the best BPO, offshore software engineering and contract manufacturing services in Europe. A long list of IT multinationals - Microsoft, Oracle, IBM, Emerson and Adobe Systems are already present in Romania as well as Ericsson, HP and Nokia who are currently expanding their operations in the country.

Romania reported €9.02 billion in foreign direct investment in 2008, an increase of 24.4% on 2007. "The latest report from KPMG confirms that this tendency is set to continue during 2009," says James Gonzalez, Market Analyst at Obelisk Investment Property, "and we can expect to see Cluj-Napoca leading the way".

James emphasises that Cluj-Napoca's prominence as an IT destination has already led to substantial job creation within the city, a pattern set to continue in the future as more companies choose Cluj-Napoca as a BPO destination. "As the city grows, so does demand for housing meaning that exit strategies through resale or rental are ideal for property investors."

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