Capital Flows

Just over a year ago, I made my second trip to Cluj-Napoca, Romania to teach a "Global Issues" camp to a group of about a hundred high school students. One evening there, I talked to a young professional about the boom, especially in real estate, that the city had been experiencing particularly since Romania's accession into the EU. He told me about a new Nokia plant that was being built outside town that was so deemed so valuable that the city agreed to build a new highway from Cluj direct to the front gates of the plant. While using public funds to build a road purely at the behest of a large company would seem to fall short of good stewardship, many people who owned property around the site and the proposed road had become overnight millionaires and weren’t complaining. I walked away from the conversation—as I often did in Romania—wishing that I had some idle capital to invest in the region, but otherwise I didn’t think any more about it. Until today. When I first arrived at my internship, I remember that one of my colleagues was in a tizzy about a plant that was closing down in Bochum and laying off all of its workers (when you’re job is to attract business investment to Germany, these things can cut you to the core). Well, reading a briefing on EU enlargement in this week’s Economist I now realize that the operation closing down in Bochum is indeed the very one that is being relocated to Cluj.

I hate to be so untreu, but on this one I’m rooting for the Romanians.