Cluj, the boss? Western town squares off against capital

Cluj-Napoca has been flexing its muscle in recent years, attracting a growing share of business. In response, EY has carried out a comparative analysis of the Transylvanian town and the capital, Bucharest, says

Analysis by professional services firm EY aims to identify the main differences and development rates of Bucharest’s and Cluj-Napoca’s demographics, education, economics, culture and tourism, to inform both residents and those considering starting a business in one of the towns.

Bucharest has the largest number of inhabitants, and is the most important industrial and commercial center in the country. According to Oxford Economics, in 2017 it was one of the EU’s best-performing cities, with higher economic growth than the European average. This is largely due to the service sector, which is increasingly important for the capital, with a 23 percent share of GDP in 2017.

Cluj-Napoca, however, came 29th in a ranking that measures the quality of life in 72 cities in Europe, 26 places higher than Bucharest. Cluj also scores better than the capital for safety, medical facilities, transport services and traffic management, according to Numbeo center data. The cost of rent in relation to income is a problem in the Transylvanian city, almost two points higher than in Bucharest (12.6 versus 11).

The data analyzed for the two towns confirm Cluj as the capital’s main competitor with its high standards of living, management of the labor force through the low unemployment rate, increase in the number of employees, and implicitly in the number of inhabitants and tourists, developing a strategy to stimulate the economy through partnerships with local universities based on innovation, technology, research, and IT.

However, a shrinking population will hinder the economic development of the capital, with Bucharest’ GDP growth slowing to 2.3 percent over the next five years, versus 7.2 percent in 2017, according to Oxford Economics estimates. The capital’s active population has fallen by about 3 percent in the last few years, and it is expected to post the same rate of decline for the next five years, which will have repercussions on job creation in the city.


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