HP CEO: The state hasn’t spent a penny on IT since October

Hewlett-Packard (HP) Romania, the local subsidiary of the world’s biggest PC and printer manufacturer, posted more than 10% decline of its business for certain groups of products, as crisis melted retail sales and cancelled public sector projects.

“The fourth quarter of 2008 marked the start of the crisis in Romania. The consumer segment collapsed, and what once was the high season for sales of laptops, PCs, printers, and even equipment for small enterprises vanished,” Radu Enache, chief executive of HP Romania told ZF in an interview, specifying that the decline was even worse than 30% for some product categories. The durable consumer goods market fell by 33.4% in the first quarter, compared with the same time in 2008 to 356 million euros, the lowest value in the last two years, according to a survey by market research firm GfK. The worst declines were those of office equipment and photo equipment, which exceeded 40%. Enache says that besides the retail decline, the private and governmental order segments were not without problems, either. “At the same time, the Government cut, cancelled or postponed all IT projects, as a result of the lack of budget funds. There haven’t been any governmental orders since October,” he added. The impact was significant, because the public sector traditionally generates one third of the American company’s business on the Romanian market. Enache added that there still were some projects in the financial-banking industry, while telecom operators showed signs of a slowdown, as they cut their expenses because of cash flow problems. HP was working with all telecom players, supplying both hardware and software and services, Enache said. “Production was the most affected segment, where major clients of IT products either cancelled, postponed or reviewed their orders downwards,” HP’s boss explained.