06 March 2000

Politician treads for business (Bucharest Business Week)

Theodor Stolojan, President Tofan Corporate Finance
Amidst piles of books, studies, notes and plans, Theodor Stolojan is alone in the cozy Tofan building after six in the evening. Everyone has finished for the day except the security guard at the entrance.
The former Prime Minister of Romania is passionate about his work. Though immersed in the private sector, he is still courted by the political parties.
Finance Minister in the Iliescu government between 1990-91, he was chosen as PM in 1991 during a period of crisis after Petre Roman fell from grace during the miners' strike. Just like the present incumbent, Mugur Isarescu, he received the task because he was not involved in any political party.
"Those were difficult times. People appreciated that I approached the administrative problems from a new angle. I managed to get the people's trust which, in my opinion, lasts longer than charisma or popularity. Respect is the only thing that time does not overcome."
He remained in that position until 1992, when the general elections were won again by Iliescu's Social Democratic Party (PDSR) and party member Nicolae Vacaroiu became Prime Minister.
Stolojan was asked to remain in a influential position but he preferred the post he was offered at the World Bank in Washington DC, as senior economist looking at development of the private sector.
"There were some very serious arguments that made me decide to go there. First of all, as an economist, I was educated by the socialist system. After three years of transition, I knew very well that my economic knowledge needed to be updated," he said. So he enrolled at the World Bank not only to have a respectable job and a decent salary but also to learn. There he had the chance to see the problems of other countries that went through the transition process, just like Romania. He was also able to see the wrong steps Romania was taking as well. "I used to focus on other countries' mistakes and, at some point, I was expecting that to happen in Romania as well. Unfortunately, it did."
At the World Bank, he focused mostly on developing and implementing privatization programs in the Republic of Moldova, Uzbekistan and other countries from the former Soviet bloc. He also worked on assessing the business environment for SMEs. That is why on his return to Romania, the switch to the private sector came quite naturally.
He came to work for Tofan Corporate Finance last year where he started on projects like the capital increase of Petrom, in which a consortium of companies including Tofan Grup, Gelsor and Grivco are involved. He is also an advisor for development issues within Tofan.
Launched in 1993 by Gelu Tofan, Tofan Grup has as its main activities: production, distribution and sale of tires, communications, transport and the food industry. Tires provide two-thirds of the group's turnover - about 200 million USD in 1998, according to Stolojan. It holds three factories: Danubiana SA Bucharest, Victoria SA Floresti, Silvania SA Zalau. The brands produced by the group are Danubiana, Victoria, Silvania, Montana and Tofansteel. "60 per cent of the production goes to the export market," Stolojan said.
Distribution is handled by Tofan's own freight company, using a network of subsidiaries in each of the counties in Romania. The whole activity of the company is controlled by satellite through Eastern Space Systems which provides satellite communications services all over Romania.
The Tofan group has acquired Cerelast SA which is the only research institute for the rubber industry in Romania. It also holds a retread factory, Tofan Recap SA, which mainly retreads truck and agricultural tires, and has a yearly turnover of around one million USD.
Overall, the company employs about 12,000 people. "Tofan was able to take real restructuring measures," Stolojan said. "Otherwise, it wouldn't have succeeded."
There is strong competition from companies bringing used tires from EU countries like Germany. "They want to simply get rid of them and they export them to countries that accept that. There are about 1.5 million such tires coming to Romania every year," he added, pointing out that it is hard to get rid of the tires, which are not biodegradable.
Stolojan also opened a small business as a sideline at the beginning of the year: a hotel in Predeal. The Premier, in the 'Clabucet Sosire' complex at an altitude of 1,050 meters, holds four suites and 12 rooms with twin beds, a conference room and car parking. The hotel indulges his interest in mountain climbing and winter sports.
Though he doesn't like to talk very much about his private life, it seems that there are some busy times for the Stolojans. His wife, Elena, "does fine in the private sector," his 28 year-old son, Vlad, is going to take his PhD in Physics at Cambridge. His daughter, Ada, 26, recently got married and is now in the USA with her husband, hoping to get a job there for Deloitte and Touche, the company that she worked for in Romania.
Stolojan's biggest disappointment is Romania's position among the countries in transition. "We had all the right figures to make progress over these years and now we're last in Europe, except maybe Albania. This situation is not fair because Romanians individually have incredible qualities," he said, although he criticized his fellow countrymen for being unable to work in teams.
Former PM, former professor within the Economics Faculty of Bucharest (ASE) and now holding an important position with Tofan, Stolojan's own career is still at the crossroads. He is tempted by several political parties to enroll but in the meantime he feels he still has a lot to achieve in the private sector. "I haven't taken any decision so far," he said.

City - Predeal.
Country - USA. A country that has gone an incredible way during the last fifteen years in the restructuring field. I also like their correctness.
Food - Trout.
Bucharest Restaurant - Cina.
Movie - No.
Newspaper - As we receive an internal press review every day, I'm interested to know, especially in the economic area, whether some things happened because of the system or because of accidents. I particulary like Adevarul, Jurnalul National and Romania Libera. The last one has interesting analysis sometimes.
Author - Michael Porter.
Car owned - Toyota Rav IV.
Last book read - Chester Karrass's 'The negotiating game'.
Hobby - Snowboard, ski, mountain trips.
Role model - None.
Music - Abba.
Sport - Ski, snowboard.
Drink - I appreciate both white and red wine.
Birth sign - Scorpio.
Last vacation taken - Last winter holidays, at Predeal.
Most prized possession - My economic books that I brought from the States.
Date and place of birth - October 24, 1943 Targoviste.

Claudia Covaci