Romanian manufacturers turn to foreign help

BACAU, Romania, Dec 28 (Reuters) Loud electronic music and hypnotic clicks of sewing machines reverberate through a long, narrow factory floor as dozens of Chinese women hunch over piles of designer clothes under rows of bright neon lights.

No strange sight in China. But for these women, a cook and a translator are all that will remind them of home when they finish their shifts in the small eastern Romanian town of Bacau.

Romania has an average monthly wage of 320 dollars, and firms are increasingly looking for migrant labour to ensure the poor Black Sea state remains a top destination for foreign manufacturers wanting to set up cheap production lines.

Once Romania joins the European Union on January 1, more Romanians may migrate to seek better pay in the west -- boosting demand here for cheap labour.

Yi Xiaomei, a shy 36-year-old from Jiangxi province, and many other women say they plan to spend several years in the fast-growing town where they earn double their Chinese salaries, with free meals, healthcare and housing.

''You just have to believe it's worth it, leaving everything behind for something that will pay off,'' said Yi, folding a beige jacket in a hall pungent with the smell of burnt rubber.

Yi and 300 other seamstresses brought to Romania by Wear Company, which supplies couture brands such as Prada and Benetton, are among the first of many Chinese to arrive to plug a growing shortage of low-skilled labour.

''There will be around 1,000 Chinese seamstresses working here by mid-2007,'' said company director Sorin Alexandru Nicolescu. ''They are not taking anyone's place foreign workers are filling a void.'' MANUFACTURERS WANTED In recent years, Romania has become a convenient low-cost manufacturing alternative to China for top-shelf European textile companies. Short distances allow them to keep a close eye on quality.

But vast emigration of Romanian workers seeking better pay in western Europe and prospects for wage growth in Romania as it catches up with western levels mean local companies are struggling to keep foreign manufacturers interested.

More than two million Romanians one in ten has left the country since communism fell in 1989, creating skills shortages in construction, textiles and healthcare.

''EU entry will intensify the labour market crisis in 2007,'' said Maria Grapini, head of a textile employers' federation.

Romanian manufacturers will need some 35,000 workers to fill vacancies in the textile industry, she added.

Other industry analysts estimate hundreds of thousands of workers will be needed, particularly after EU cash starts arriving and boosts the number of infrastructure projects.

With growth fuelled by robust domestic consumption, Romania needs to ensure foreign investment keeps coming in to keep its economy on an even keel.

The country has speeded up economic reforms in recent years and expects foreign direct investment to rise to a record eight billion euros in 2006, or a quarter of the state's annual spending plans.

FOREIGN HELP With Romania's low unemployment rate of five per cent, a growing shortage of workers in some sectors and strong economic prospects after EU entry, some analysts say the exodus of Romanians abroad could be curbed in coming years.

But others argue more Romanians could leave after January, hoping for a better life in Spain or Italy, whose languages are similar to Romanian.

Many western European states are worried that Romanian and Bulgarian workers could stretch their job markets and welfare services adding to a wave of migrants that arrived after the EU's first wave of eastward expansion in 2004.

''No one knows what will happen after January, how many more people will leave,'' said Antonello Gamba, head of Sonoma, an Italian-owned firm in Bacau which outsources some of its production to Wear Company.

''If you have contracts, what will you do? Tell Prada you quit because you don't have workers?'' he said.

The country faces a delicate task, needing both to open its borders to the much-needed workforce but at the same time ensure it does not become an easy transit route to western Europe, particularly for Moldovans who also speak Romanian.

Official figures show 7,000 foreign workers registered in Romania, mainly from Turkey, Moldova and China. But analysts say the real number is bigger.

On the dusty outskirts of Bucharest, a small Chinatown has sprung up, a labyrinth of open-air stalls thriving on sales of cheap goods from cotton shirts and wedding gowns to rugs and plastic flowers.

Residential buildings are emerging nearby and an Asian mall designed to replace the market stalls is gaining ground.

''I think everybody understands the labour market cannot be closed ... it cannot be functional and self-regulating as long as there is a workforce deficit,'' Grapini said.

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