The President of Romania has told Microsoft chairman Bill Gates that computer piracy had helped his country to develop an IT industry.

Speaking at the opening of a new technical centre in Romania, Traian Băsescu told Gates that without piracy his country would not have an IT industry.

"Piracy helped the young generation to discover computers. It set off the development of the IT industry in Romania," he said.

"A bad thing became, in the end, an investment in friendship towards Microsoft and Bill Gates; an investment in educating the young generation in Romania which created the Romanians' friendship with the computer."

Gates made no reply. He was later presented with the Star of Romania by Basescu. The honour is traditionally awarded for outstanding bravery during wartime.

The most recent global study of piracy carried out by the British Software Alliance (BSA) found that 72 per cent of software in Romania is pirated, despite copyright laws being passed 10 years ago.

"Software piracy has many negative economic consequences, such as local software industries being crippled by competition with pirated software from abroad, and lost tax revenues and jobs from the lack of a legitimate market," said the BSA report.

"These costs reverberate up and down the supply and distribution chains."