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Tag: economic measures

August 17, 2022 UPDATE

Measures – The measures to cap and compensate for the energy price will remain active in Romania in the formula necessary to protect citizens and the economy, the Prime Minister Nicolae Ciucă informed, during the first meeting of the Interministerial Committee for ensuring energy resilience and implementing energy infrastructure projects. According to a press release, the prime minister established an action plan to ensure predictability from the point of view of energy production, as well as from a budgetary point of view. At the request of the Prime Minister, the Energy Ministry will present, on August 22, the situation of the investment programs in the production capacities, both of the state companies and in those developed by the private sector. We remind you that electricity and natural gas prices increased with the complete liberalization of the market, in January 2021.

Visit — The Romanian Foreign Minister, Bogdan Aurescu, will pay a visit to Prague on Thursday, at the invitation of his counterpart, Jan Lipavsky, in the context of the Czech Republic holding the presidency of the EU Council. According to a Foreign Ministry press release, the discussions will focus on Romanian-Czech cooperation within the EU, with an emphasis on coordinating the two states’ stands. The visit is an important opportunity for boosting bilateral political dialogue and intensifying economic cooperation. Bogdan Aurescu and Jan Lipavsky will address current topics on the regional, European and security agenda, including the multiple consequences of the illegal war of the Russian Federation against Ukraine. The two ministers will also discuss the cooperation of the two states within NATO and the implementation of the decisions of the Madrid Summit, especially regarding the consolidation and efficiency of the deterrence and defense posture on the Eastern Flank, including in the run up to the meeting of the NATO countries’ foreign ministers. The meeting will be hosted by Romania in Bucharest at the end of November.

Statistics – The Gross Domestic Product of the European Union and the Eurozone registered an increase of 0.6% in the second quarter of 2022, as compared to the previous three months, show preliminary data published on Wednesday by the Statistical Office of the European Union (Eurostat). In the first quarter of 2022, compared to the previous three months, the Gross Domestic Product registered an increase of 0.5% in the euro zone and of 0.6% in the EU. Among the EU member states for which data are available, the most significant economic growth rate in the second quarter of 2022, compared to the previous three months, was recorded in the Netherlands (2.6%), Romania (2.1%) and Sweden (1.4%). Compared to the second quarter of 2021, the GDP increased by 3.9% in the euro zone and by 4% in the European Union between April and June 2022, with all the EU member states for which data are available reporting increases. Romania registered an annual economic growth rate of 5.3% in the second quarter of 2022, after an annual growth rate of 6.4% in the first three months. The National Institute of Statistics announced that Romanias economy grew by 2.1% in the second quarter of the year, compared to the previous quarter, while compared to the similar period of 2021, the growth rate was 5.3%.

Covid — 7,500 new cases of SARS-CoV-2 infection have been registered in the last 24 hours, 3,900 more than the previous day, the Health Ministry announced on Wednesday. 274 patients are in intensive care, most of them unvaccinated. In the last 24 hours, 42 deaths were reported in COVID patients. We remind you that Romania has not imposed any coronavirus pandemic-related restrictions since March 9 this year. The first case of infection with SARS-CoV-2 was declared at the end of February 2020 and, for about two years, there have been five pandemic waves resulting in almost 2.8 million infections, 2.6 million recoveries and about 65 thousand deaths associated with Sars-CoV-2.

Swimming — The Romanian swimmer David Popovici, world and European champion in the 100m and 200m freestyle events, withdrew from the 400m freestyle final, scheduled for Wednesday evening at the European Swimming Championships in Rome, according to a Facebook post of the Romanian Swimming Federation. A few hours ago, Popovici, 17 years old, had qualified with the fourth time of the heats to the 400m freestyle final. The busy schedule of the next period, the very great effort that he would have made in the final and his wish to prepare as well as possible for participation in the World Junior Championship in Lima are the reasons behind this decision, Romanian Swimming Federation sources pointed out. (LS)

17 August 2022
September 11, 2020

COVID-19 IN ROMANIA – The Government in
Bucharest announced it would adopt the decision to extend the state of alert in
Romania on Monday. The document could not be voted in Thursday’s Government
meeting as it lacked the go-ahead of the Legislative Council. 1,391 new
infections with SARS CoV-2 have been reported in Romania in the last 24 hours,
the Group for Strategic Communication has said, exceeding a total of 100,000
infections at national level. Another 35 people have died, taking the total
death toll to 4,100. 478 patients are in intensive care. 7,125 people infected
with COVID-19 are currently receiving treatment in hospitals. 10,772 are in
home isolation, 5,754 in institutionalized isolation. 33,129 people are
quarantined at home while 12 are in institutionalized quarantine.

COVID-19 IN THE WORLD – Over 28 million
infections with SARS CoV-2 have been reported worldwide since the start of the
pandemic. The United States continues to be the most affected country, with
nearly 6.6 million infections and some 196,000 deaths. India is the second-most
affected country in terms of the total numbers of infections, some 4.5 million.
76,000 people have died to the virus in India. The resurge in the number of
infections have determined numerous European states to reintroduce restrictions
to prevent the pandemic from spreading. France is playing host to a new meeting
of the Defense and Health Safety Council, devoted to managing the pandemic.
Belgium, Italy and Great Britain are also hit by a second wave, although less
serious than that of March and April. In Croatia, Greece and Malta the increase
in the number of cases is higher than compared to the first wave.

SCHOOLS – The Government has
earmarked an additional €20 million to the budget of the Education Ministry to
fund the Safe Education National Programme. The money will be used for the
purchase of laptops, medical equipment and electronic devices, such as webcams
and tablets, so that teachers can conduct their lessons online wherever the
epidemiological context requires it. A new school year is starting next Monday
in Romania.

ECONOMY – There was no way
for the Government to avoid the economic slump this year, as its main goal was to
reduce the negative effects generated by the COVID-19 pandemic, Finance
Minister Florin Cîţu told an online conference. I’ve examined the consumption
figures, and, for instance, retail sales are nearing the level prior to the
pandemic. I’ve looked at investments, as they continued even during the crisis.
We have a positive overall contribution of investments. Prices for the month of
August went down, the inflation rate is 2.7%, down from 4.1% last year, the
highest at EU level at the time, Florin Cîţu went on to say. The Finance
Minister says EU leaders are happy with the measures our Government has
introduced during the health crisis, which helped protect both the population’s
health and the economy.

BREXIT – The European Union
is determined to reach a post-Brexit trade agreement with the United Kingodm,
despite significant divergences that still stand at the end of several days of
negotiations, the EU chief negotiator for Brexit, Michel Barnier has said. The
EU official warned that Europe is preparing for any outcome. One obstacle in
the way of an agreement is the protocol on Northern Ireland, providing that
this British province should continue to observe some EU rules even
post-Brexit, to guarantee the absence of a physical frontier with the Republic
of Ireland, a member of the EU. Yet London’s amendment explicitly states that
some provisions will be enacted even if they go against the withdrawal
agreement. The European Commission has allowed the UK to withdraw the amendment
by the end of the month, warning that in the case of a refusal it would attack
the decision in court. London has dismissed the ultimatum, saying the amendment
still stands.

9/11 – Today marks 19
years since the terrorist attacks of September 11 in the United States,
considered the bloodiest in world history. Some 3,000 people, including
Romanians, were killed by 19 Al Qaeda terrorists who hijacked 4 passenger
airliners, crashing them into key buildings in the US. The death toll continued
to rise after the attacks, many people dying due to exposure to dust from the
site.

(translated
by V. Palcu)

11 September 2020
Prime Minister Ludovic Orban appears before Parliament

The Liberal Government in Bucharest is preparing an
economic recovery plan after the coronavirus pandemic, Liberal Prime Minister
Ludovic Orban said in Parliament, where he was invited to present the measures
taken so far by his team. The Prime Minister stated that, in the first quarter
of 2020, Romania reported the biggest economic growth at EU level. Ludovic
Orban:

Most Romanian companies and most fields of activity
remained operational, and the figures speak for themselves. Our data shows that
in the first quarter Romania had the biggest economic growth. Data for the
second quarter will reveal that, compared to other countries, Romania’s economy
fares far better than many are willing to admit.

Prime Minister Orban added that restrictions in the
economic field were taken to lower the threat to people’s lives and well-being,
saying that no construction site was closed down. Evidence of that can be found
in the structure of economic growth for public investments. As regards the
hospitality industry, which has been under tremendous pressure during this
crisis, Ludovic Orban said the Government supports the restart of activity by
taking active measures, when the epidemiological context will allow it. The
opposition in Parliament disagrees, claiming the Government’s economic policies
have made it impossible for thousands of companies to pay their bank
installments, many of them now on the verge of bankruptcy. The opposition says
the Government’s support programme addressing SMEs has turned out to be
inefficient. ProRomania leader Victor Ponta believes the Orban Cabinet in fact
has no solutions to the present crisis:

Today Romania’s Parliament must make up for the
Government’s lack of action and measures. We are talking about the economy, the
true crisis Romania is already facing and which it will most likely continue to
face, once the health crisis has passed. Allow me to ask you – will you resign
willingly or must Parliament remove you from office again?

In turn, Social-Democrat interim leader Marcel
Ciolacu has called for concrete actions, the lack of which might trigger a new
vote of no-confidence:

You’ve inherited a functional economy, with a 4%
growth, which you’ve now lowered to 2%. Over 70% of Romanians have money in
their bank accounts to last them a month. Today, you should have resigned, but
you lack the dignity to do it, for all the damage you’ve done to this country.

Other parliamentary groups have asked for concrete
measures to overcome the economic crisis, calling on the Government to show
responsibility and engage in a constructive dialogue with its political partners.

(Translated by V. Palcu)

19 May 2020
April 2, 2020

EMERGENCY DECREE – At
midnight, local time, a new Government emergency decree takes effect,
increasing fines for anyone who doesn’t observe the special measures taken to
limit the spread of the coronavirus. According to the latest toll, 94 people
have died to the virus nationwide. Moreover, according the Group for Strategic
Communication, a total number of 196 Romanian citizens abroad have tested
positive for the virus: 105 in Spain, 57 in Italy, 14 in France, 7 in Germany,
4 in the UK, 2 in Namibia, 2 in Indonesia, and 1 each in Tunisia, Ireland,
Luxemburg, Belgium and the US. As many as 24 Romanian citizens died from the coronavirus
abroad: 9 in Italy, 6 in France, 4 in the UK, 4 in Spain and 1 in Germany. On
Wednesday, President Klaus Iohannis chaired a meeting which assessed and
presented public safety and order measures aimed at preventing the spread of
the coronavirus. The President warned that anyone who doesn’t abide by the
legislation, emergency decrees and regulations will be fined. Since the onset
of the state of emergency the authorities have carried out 870,000 checks and
handed out over 78,000 fines.

ECONOMY – The automobile industry wants to help the national
economy and contribute to the production of medical equipment, such as masks,
protection gear and biocides, Economy Minister Virgil Popescu has said. The
Romanian official went on to say that representatives of the automobile
industry will take part in a national project aimed at building ventilators
needed to trick the COVID-19 sick. On the other hand, Minister Popescu said
representatives of the Dacia carmaker are working on a scenario to resume
production towards the second half of April. Due to the pandemic Dacia has
suspended its activity at the power plant in Mioveni until April 5, with over
13,500 workers becoming technically unemployed.

EMPLOYMENT CONTRACTS – Over
950,000 employment contracts at national level have been suspended starting
April 1, the Labor Ministry has announced. Some 207,000 employees in the
manufacturing industry, 156,000 people working in retail and car services and
over 110,000 workers in the hospitability sector are now technically
unemployed. Over 155,000 individual employment agreements have been terminated,
most of which in trade and services, the manufacturing industry and
constructions. The authorities recall that as of Wednesday people can apply for
technical unemployment benefits.

WARNINGS – The number of confirmed
infections with the COVID-19 virus might reach 1 million, with the death toll
possibly exceeding the 50,000 mark, the World Health Organization president
Tedros Adhanom Ghebreyesus has said. The WHO official expressed concern with
the swift growth of the number of coronavirus infections. Over the past
five weeks, we have witnessed a near exponential growth in the number of new
cases, reaching almost every country.The
number of deaths has more than doubled in the past week, the WHO president
went on to say. In another development, experts with the World Health
Organization and the World Trade Organization (WTC) have warned against food
shortage risks on global markets due to disruptions in the supply and
production chain caused by the COVID-19 pandemic. International bodies express
concern over the slowdown in the circulation of workers in the agricultural and
food industries, which is blocking agricultural works in numerous Western
countries and causing border crossing delays in the transport of merchandise,
which in turn leads to a waste of perishable foodstuffs. Experts have also
highlighted the need to protect workers from the agri-food sector and those in
the distribution chain, so as to minimize the spread of the virus and maintain
supply chains open.

NATO – Foreign Minister Bogdan Aurescu is today attending a
video-conference of NATO foreign ministers. The meeting will look into ways of
dealing with the effects of the coronavirus pandemic and its impact on NATO’s actions.
The agenda for talks will also focus on threats coming the southern vicinity,
the process of strategic reflection on consolidating NATO politics as well as
security developments in the Euro-Atlantic area. The meeting bears special
significance for Northern Macedonia, being the first time this country takes
part as an Ally state, the number of NATO members thus reaching 30. NATO should
make sure that the COVID-19 pandemic doesn’t endanger the security of its
allies, as threats haven’t miraculously disappeared, NATO Secretary General
Jens Stoltenberg has warned.

(Translated by V. Palcu)

2 April 2020
Project to support the economy

Beyond the round-the-clock fight to save the lives of
the gravely sick, another major concern in these difficult times at global
level is to find solutions to keep the economy moving forward. Governments worldwide
have taken pre-emptive measures to support the population facing financial difficulties,
as well as various sectors of the economy, some of them already shaken by the
pandemic. The head of the Prime Minister’s Office, Ionel Danca, has announced
new assistance packages. Therefore self-employed persons as well as family or
individual businesses that have suspended their activity will benefit from a set
allowance tantamount to the minimum wage, irrespective of contributions paid to
the unemployment scheme. Ionel Danca also promised the Government would
introduce new regulations for all types of enterprises and professional
activities: large enterprises, cultural or sporting activities, NGOs affected
by the state of emergency.

In turn, Finance Minister Florin Citu said a
solution would be presented shortly to the clients of banks facing
difficulties, adding that talks are already ongoing with the National Bank and
the banking sector. The Social-Democratic Party, the Alliance of Liberals and
Democrats and the Pro Romania Party have submitted a bill providing for tax
benefits. Among other things, the bill proposes a postponement of social
security contributions for salary incomes and for social-security payments for
a period of three months, starting March. The measure can be requested by each
economic operator individually. Employers, on the other hand, must safeguard
all employment contracts for a minimum period of 9 months.

The Social-Democrats
want the Government to suspend the refund of bank installments to the
population, a measure already implemented in other European states. The
Social-Democratic Party says the Government employs half-measures and
incoherent policies, which is why they are considering the possibility of
calling a no-confidence vote. The motion will not be targeted against the
Government per se, but rather will contain a set of concrete economic measures.
According to a previous Constitutional Court ruling, once voted, the provisions
of any simple motion become compulsory and must be enacted by the Government.
In turn, the Democratic Union of Ethnic Hungarians wants to immediately suspend
fiscal obligations for enterprises that do not fire employees, while the Save
Romania Union says the financial measures announced so far by the Government
are important, but are not enough.

(Translated by V. Palcu)

24 March 2020
Economic Programs

One month before the start of the campaign for the parliamentary elections due on December 11th, the party ranking first in the polls, the Social Democratic Party, has drawn up its economic agenda, as part of its potential governing program. The Social Democrats propose a mix of liberal and social initiatives, aimed at satisfying the captive voters. Their program includes measures such as the elimination of 100 non-fiscal fees, fiscal relaxation measures, as well as measures aimed at increasing people’s incomes.

Also, the Social Democratic Party would like to see more money in the 2017-2020 budget as a result of European funds absorption, the setting up of a sovereign development fund and investments under which the amounts entering the economy would return to the general consolidated budget in the shape of taxes and fees, including the VAT. Also, the Social Democratic Party would like to ensure a fiscal re-launch for employees, for the income tax to reach zero, as of January 1st 2008, for those who earn up to 2000 lei, which is 450 Euro, for doctors and IT specialists. As for pensioners, the Social Democrats come with a proposal that nobody would refuse: eliminating the income tax as of next year, also if the pension is lower or equal to 2000 lei.

Also, all pensioners would no longer have to pay contributions to the health insurance fund. As the main opponent of the Social Democratic Party, the National Liberal Party would like to give the economy a boost by investing an additional 24 billion Euros in the coming four years. As regards taxation, the liberals propose the generalization of the 16% flat tax, now applicable only to the income tax. Therefore, the standard VAT and the social contributions paid by employers and employees would be all brought to the level of 16%.

The newly created Save Romania Party, ranking third in voters’ preferences, comes with a long term vision for sustainable development, based on investments, not on consumption and fiscal incentives, as well as strategic investments in infrastructure and education. Under the Union’s program, transportation is a national priority and health care would benefit from additional funds from the budget and would enter a process aimed at rendering it more effective. Debates on the three parties’ economic offers have been disturbed by the dispute over the warning launched by Romania’s president Klaus Iohannis, who said that, after the elections, he would not designate a prosecuted or convicted Prime Minister.

The President did not give any names, but the leader of the Social Democratic Party Liviu Dragnea, sentenced in the famous case of the 2012 referendum on the impeachment of the then president Traian Basescu, felt like the cap fit him. Offended, he accused the head of state of overstepping his constitutional responsibilities. That moment marked the unofficial start of the election campaign, which is very likely to be marked by fierce electoral confrontations.

(Translated by Mihaela Ignatescu)

10 October 2016
July 31, 2016 UPDATE

INVESTIGATION – Deputy Governor of the National Bank of Romania Bogdan Olteanu, currently under home arrest for 30 days in a case where he is accused of influence peddling, has announced he would step down on Monday. Olteanu was arrested on Thursday, prosecutors calling for his pre-trial arrest. Anticorruption prosecutors are accusing Olteanu of demanding and receiving 1 million euros and support for his election campaign from a businessman in exchange for appointing Liviu Mihaiu as the governor of the Danube Delta, during his time as Speaker of the Chamber of Deputies. This is the first National Bank official to be investigated by the National Anticorruption Directorate. In a press release, the Central Bank said the investigation is focused on Bogdan Olteanus political career before he became Deputy Governor in 2009.

SURVEY – Over 40% of Romanians believe immigration and terrorism are the main challenges facing the EU, reads a recent Eurobarometer published by the European Commission in July. Over 31,000 people from 34 European countries and regions took part in this survey over May 21-31, 2016. In Romania, 42% of respondents depicted a positive image of the EU, down by 15% as compared to the previous survey, while 14% of them said they had a negative image of the EU, up by 5%. At national level, Romanians concerns are related to the healthcare and social security schemes, with 37% of the answers, unemployment 25% and inflation 24%.

MILITARY EXERCISE – Over 2,700 military from five NATO member states – Bulgaria, Canada, Poland, Romania and USA – and five members of the Peace Partnership – Armenia, Azerbaijan, Georgia, the Republic of Moldova and Ukraine are starting today and until August 5 taking part in a large-scale military exercise in Cincu, central Romania. Organized by the General Staff of Ground Forces, the exercise is aimed at training the military in compliance with NATO standards. Command, training, computer-assisted simulations, ground troops and tactical exercises will be organized. According to the Defense Ministry, over 900 Romanian military and some 1,700 US troops equipped with M1A2 Abrams tanks and Bradley armored fighting vehicles, and 47 Canadian military equipped with infantry combat vehicles, will be carrying out tactical shooting exercises.

MEASURES – Starting August 1, the VAT for the Romanian agriculture sector will drop from 20 to 9%. The measure will be applied for fertilizers, pesticides, seeds and other agricultural products used in seeding and cultivating plants. Farmers will pay less for farm works this year, while consumers are expected to buy cheaper products starting next year. Prime Minister Dacian Ciolos explained the decision is aimed at stimulating quality farming and stepping up productivity in this sector. Also starting August 1, some 650,000 employees in the public sector will get higher salaries. The measure will apply to the employees in the healthcare, education, administration and defense sectors. Also on August 1, over 600 former MPs will benefit from special pensions, awarded depending on the number of mandates they have had.

BILATERAL RELATIONS – The UK will continue its strategic partnership with Romania, focusing on two pillars, security and prosperity, British Ambassador Paul Brummell has said. Attending a summer camp in central Romania, the British official said Romanians in Britain should remain calm, because Brexit negotiations will be a long process, at the end of which nothing will change. Brummel gave assurances that no changes will involve the situation of Romanian students in Great Britain before negotiations are completed.

WYD – The World Youth Day was celebrated on Sunday in Krakow Poland, where hundreds of thousands of people, mostly young pilgrims from all around the world, came to attend a mass officiated by His Holy Father Pope Francis. In his message, the pontiff urged young people to embrace hope and focus on prayer as the central aspect of their lives. The Pope also told young people to look beyond the mundane gratifications offered by technology, and use their hearts to change the world. The event coincided with the 1,050th anniversary of Polands adoption of Christianity.

TURKEY – Turkish president Recep Tayyip Erdogan has told a television that he would forward Parliament a minor constitutional reform, which, if adopted, will place the national intelligence service and the chiefs of general staff under the presidencys control. The measures are aimed at handling full control of the military to the civilian leadership after the failed coup of July, where one military faction used tanks, fighter jets and helicopters to overthrow the power. Recep Tayyip Erdogan said military academies will be shut down and replaced with a National Defense University. The Turkish presidents statement follows last weeks thorough-going reform of the military: nearly half of the generals have been dismissed. After July 15, some 18,700 people have been arrested. 140 newspapers, radio and television stations were shut down.

31 July 2016
The Week in Review: October 25-31

The “vote by mail law has been adopted

Romanian citizens domiciled abroad will be able to vote by mail, but only in the parliamentary elections due next year. The Chamber of Deputies with the Romanian Parliament on Wednesday passed a law on this issue. The measure was extremely necessary, after thousands of Romanians in the Diaspora queued up at polling stations for hours to vote in last years presidential election, with some of them finding it impossible to cast their votes, because of the improper organization of the ballot. The ruling Social-Democrats say the law voted on Wednesday is a pilot project, which might be extended to the presidential and European elections, if everything goes well at the parliamentary elections next autumn.

The president of the Social Democratic Party, Liviu Dragnea explains: “As there are slightly different procedures and a more comprehensive analysis of the two rounds of the ballot is needed, in terms of logistics and infrastructure, decision makers didnt want to have another reason to postpone the adoption of this law again. All those who doubted that the same provisions will apply to the presidential elections, will be proven wrong or to intentionally try to cast a shadow over what we have all achieved here.

The National Liberal Party, in opposition, voted for the law, in the hope that it will be extended, after the 2016 parliamentary elections.

Liberal MP Mihai Voicu: “We have taken a step forward by adopting the vote by mail system for parliamentary elections, but we have to do more. This is all that could be achieved given the current parliamentary majority. Hopefully, another parliamentary majority, formed after the 2016 elections, will extend this law.

The fight against corruption continues

Gheorghe Nichita, the suspended mayor of Iasi, the largest city in eastern Romania, and Tiberiu Urdareanu, the CEO of a significant group of firms, UTI, were taken into custody on Thursday evening, for taking and giving bribe, respectively. According to the National Anticorruption Directorate, Gheorghe Nichita allegedly claimed and received undue benefits in exchange for granting a EU funded contract worth some 12 million euros to the UTI group. The contract was meant to ease road and pedestrian traffic and reduce the level of pollution in Iasi.

In another move, MP and former development minister Elena Udrea, who has just been released from arrest and is now subject to legal restrictions pending trial, is again investigated by anticorruption prosecutors as part of a different case. Udrea is accused that, during her tenure as a minister, she received a 4 million US dollar bribe from a businessman to help him earn a contract. Elena Udreas colleagues in Parliament this week approved the start of a criminal investigation against her and her being taken into custody, but they rejected a request for her pre-trial arrest.

New economic measures

The government approved on Tuesday several amendments to the Fiscal Code, among which the reduction of the VAT for water to 9%; changing the tax bracket for micro-enterprises; exempting higher secondary education institutions from paying profit tax; and reducing tax on dividends from 16% to 5%. The Romanian business environment has welcomed the introduction of this last measure, which will take effect as of January 1st 2016 and will apply to dividends obtained by Romanian natural persons and legal bodies, as well as to the dividends obtained in Romania by non-residents.

Also this week, the government approved a new package of laws on public procurement that incorporates the latest European norms in the field and is designed to improve infrastructure. The package will be sent to Parliament to be debated and voted on as part of an emergency procedure. The economic policy analyst with the European Commission Representation in Bucharest, Carmen Marcus, has quoted Romanian and foreign experts as saying that Romania has never had a better macro-economic situation, following financial assistance programs with its international creditors. Also, Romania ranks 37th out of 189 countries in a World Bank business classification, going up 11 positions and overtaking such countries as Italy, Hungary, Russia, Croatia and Greece.

The Republic of Moldova has no government

Romanias president, Klaus Iohannis, took note of the collapse of pro-western three-party government of the Republic of Moldova on Thursday and underlined that a stable government should be formed for Moldova to be able to stay on its European course.

According to president Iohannis, Romania reiterates its commitment to provide full support to neighbouring Moldova in this respect. Romanian foreign minister Bogdan Aurescu shares this view: It is extremely important for the whole responsible political class in Chishinau, particularly the pro-European parties that have been voted for this very purpose by the citizens of the Republic of Moldova in November 2014, a vote which was reconfirmed by the pro-European choice in the local elections held in June, to understand that Moldova needs stability, a pro-European coalition and European reforms.

The Moldovan cabinet led by Liberal-Democrat Valeriu Strelet has been dissolved by Parliament following a censure motion initiated by the Socialist and pro-Russian communist opposition. Voting for the motion, which involved a vote of confidence in Parliament, were also the members of the Democratic Party, who are part of the ruling coalition, who, just like the initiators of the motion, accuse Valeriu Strelet of incompetence and corruption. The latter said that, by initiating the motion, the left tries to destabilise the republic and deviate it from its target, namely European integration.

31 October 2015
Economic Measures

The Romanian Senate passed by a wide margin a bill cutting 5% off of social insurance payments by employers. If the draft law passes the lower chamber, it goes into a special plenary meeting in early July, to come into effect on October 1st. The government, which introduced the bill, said it is meant as an incentive for employers to create jobs. In a rare occurrence in Romania, both the parties in power and the opposition supported the move, but trade unions claimed that the economy cannot cope with it. Dumitru Costin, head of the National Trade Union Bloc, said that the social insurance budget would take a heavy hit:

Dumitru Costin: “The present economic model in Romania cannot support this five percent slash in social insurance revenue, as the Romanian government plans, and the measure will not motivate employers and employees to come out of the informal economy. We should have a huge number of officially employed people, something like eight million, in order to make this work. I cannot believe that over two million more jobs would emerge overnight in the Romanian economy.”

The IMF also expressed skepticism in relation to the move. Spokesperson Gerry Rice said that there would be an impact on the 2015 budget, which should be calculated. The vice-chairman of the European Investment Bank, Mihai Tanasescu, said that the move has to be accompanied by restructuring:

Mihai Tanasescu: “Such a measure has to be accompanied by large-scale restructuring of the Fiscal Administration, in order to improve collection and priorities, so that the volume of investments may rise.”

25 June 2014