Nature has been generous with Romania, endowing the country not only with oil and mineral resources underground, but also with fertile topsoil and a climate favorable for growing a wide range of crops, including tobacco.
Now that the government is moving quickly to liberalize the economy, with the entire agricultural sector to be privatized by the end of next year, foreign investors will be able to cash in on Romania’s bountiful harvests.
One major enterprise to be sold off soon is the Romanian National Tobacco Company, the state monopoly known by its Romanian initials, SNTR.

The firm was previously slated for privatization, but the process was temporarily blocked by legal challenges. That has turned to out to be a blessing in disguise, especially for the future buyer, according to the Agriculture Minister, Ilie Sarbu. The delay has given the Nastase government time to carry out a reorganization of SNTR and get it back on solid footing after suffering a period of mismanagement under the previous administration.
“The company is already prepared for privatization,” says Mr. Sarbu. “We will have an updated evaluation of the company and it will be put up for privatization once again. The good thing is that the restructuring and rehabilitation phase started and production and distribution have reached previous high levels.”
In fact, according to the minister, SNTR would already be making a profit were it not for the burden of the debt accumulated in the past due to poor management.

As things stand, Mr. Sarbu believes “there will be interest not only in Europe, but also in the U.S.” when SNTR is put up for sale.
The company has some 250,000 acres of tobacco fields, as well as many years of experience in every facet of the business, from planting the seeds to selling the finished product, as well as all the necessary infrastructure.
In fact, SNTR even produces machines, equipment, and spare parts for sale to other cigarette manufacturers, just as it does with its flavorings and additives.

Moreover, SNTR can boast a solid market base at home and has other markets close at hand, both to the East and to the West. Romanians have a long tradition of consuming tobacco and the domestic market is actually growing, as smoking ceases to be something reserved for men only. STNR produces cigarettes marketed under a number of different brand names, all well known to the Romanian public.
Geographic location and competitive labor costs give STNR, and other Romanian firms, a natural edge. As the Agriculture Minister says, U.S. investors will find “big advantages if they invest in Romania and produce here for Western markets, because transportation and handling costs are reduced.”