Radio România Internațional

Tag: economy

August 31, 2017

DIPLOMACY – The Annual Meeting of Romanian Diplomacy continues in Bucharest today with a conference on the role of the Romanian business community in economic diplomacy. During Wednesdays meeting with the Romanian ambassadors and consuls abroad, President Klaus Iohannis called on diplomats to promote the rule of law and focus on protecting the rights and interests of the Romanian citizens abroad. The head of state also discussed the importance of the strategic partnership with the United States and urged the Romanian diplomats to support the trans-Atlantic relation. This years meeting of Romanian diplomats was themed A changing world: the goals of Romanias foreign policy.

EXCISES – Romanian carriers criticise the Governments decision to increase fuel excises, and predict dark times will come for Romanian transports. The Romanian Federation of Transport Operators says each additional eurocent in the price of petrol and diesel will have a direct impact on the competitiveness of Romanian road carriers and will force many international transport operators to buy fuel from abroad. On Wednesday the Government decided to increase fuel excises in 2 stages, as of September 15 and October 1, respectively. Finance Minister Ionuţ Mişa explained that the measure would be introduced gradually so as not to generate a shock, consisting in higher prices and lower consumption, which would affect the state budget.

LANGUAGE DAY – Today is the Romanian Language day, celebrated on the last day of August since 2013. On this occasion, the Ministry for the Romanian diaspora is organising in Bucharest, in a partnership with the Romanian Academy, a conference on Romanian language revival and renewal in the diaspora, while the Romanian Cultural Institute organises activities in major cities abroad. Conferences, roundtables, book launches, recitals and exhibitions are organised in Istanbul, New York, Madrid, Tel Aviv and Warsaw. The Romanian Language Day is also celebrated in the Republic of Moldova, and according to the ambassador of Romania to Chisinau, Daniel Ioniţă, this is further proof of the profound unity of the people living on the two banks of Prut River.

JUDICIARY – The Romanian Justice Ministry has made public the bill modifying the laws on the judiciary, on which Minister Tudorel Toader has requested the official opinion of the Superior Council of Magistrates. The bill, which is intended to make the management of courts and prosecutor offices more efficient, stipulates changes primarily in terms of the professional assessment, promotion, and appointment to senior positions of staff in the judicial system. Some of the changes announced a while ago by Minister Tudorel Toader concern the appointment of the prosecutor general and of the chief prosecutors of the National Anti-Corruption Directorate and the Directorate Investigating Organised Crime and Terrorism by the Superior Council of Magistrates based on a nomination by the Justice Minister, and the setup of a special directorate to investigate offences committed by magistrates. The measures have been criticised and prompted street protests. The National Anti-Corruption Directorate says this is a form of pressure on the work of prosecutors, while the Prosecutor General, Augustin Lazar, says that if endorsed, the bill would affect the independence of magistrates and the activity of judicial institutions.

FOOTBALL – Romanias national football team is preparing for the game against Armenia, to be played on Friday on home turf, and the one against Montenegro away from home on Monday, as part of the preliminary Group E of next years World Football Cup hosted by Russia. The unchallenged leader of the group is Poland, with 16 points, followed by Montenegro and Denmark, with 10 points each, Romania and Armenia, 6, and Kazakhstan, with 2 points. In this preliminary campaign, the Romanian team is for the first time in its history managed by a foreign coach, the German Cristoph Daum.

(translated by: Ana-Maria Popescu)

31 August 2017
The new Romanian prime minister travels to Brussels

It’s not by chance that Romania’s new leftist Prime Minister Mihai Tudose travelled to Brussels for his first foreign trip. Given the political instability that preceded the installation of his cabinet, Tudose gave assurances during talks with European officials that Romania remains a reliable partner that will rigorously fulfil its commitments. He met the presidents of the European Council and of the European Commission, Donald Tusk and Jean-Claude Juncker respectively, the head of the European Parliament Antonio Tajani and the Commissioner for Regional Policy Corina Cretu. Talks focused on the latest economic developments and the Schengen accession, the state of the judiciary and the absorption of European funds. This final subject was particularly sensitive, given that since its entry into the European Union in 2007, Romania has not excelled in this area. Prime minister Mihai Tudose: “The good news is that a sum of 600 million euros has been unblocked this week through the famous managing authorities, and funds are beginning to be validated. It’s a first good sign.”

The prime minister said he was seeking better collaboration between his ministers and the European officials as far as community funding is concerned: “All ministers involved in European projects are to travel to Brussels at least once a month to discuss with the Commissioners; there will be regular contacts with the Council and the Commission to make sure that what we do in Romania does not reach Brussels in a distorted way and that there are no major discrepancies between reality and perception.”

Speaking about the economy, Tudose said Romania’s budget deficit would not exceed 3% of the GDP and that his government was no longer planning to introduce the controversial turnover tax. As for Romania’s accession to the Schengen area, he said this was technically possible, provided the political and economic issue is solved.

Mihai Tudose: “On the subject of the Schengen accession, my interlocutors agreed that, from a technical point of view, things are almost if not completely in place, the only problems that still exist being a matter of politics and competition, because things have moved more in the direction of the economic area. We are confident, however, that we will overcome this moment.”

The Cooperation and Verification Mechanism used by Brussels to monitor the situation of the judiciary ever since Romania entered the European Union was another important subject discussed by Prime Minister Tudose in Brussels. The president of the European Commission Jean-Claude Juncker said the Mechanism must be lifted by 2019, when Romania is to take over the EU rotating presidency, if the judiciary stays on its current course. Mihai Tudose has given assurances that his government will not adopt measures that have not been previously discussed with civil society, passed by Parliament and communicated to Romania’s European partners, while also complying with the rulings of the Constitutional Court in Bucharest.

12 July 2017
23 May, 2017

ATTACK — 22 people have been killed and around 60 more injured in an explosion in Manchester on Monday, at the end of a concert on the Manchester Arena. British authorities have confirmed that a suicide bomber carried out the attack. Security measures have been bolstered, and the British government met today in emergency session. Prime Minister Theresa May and Labor leader Jeremy Corbyn have suspended their campaigns for the snap elections on 8 June. This is the worst attack in Britain since the July 7, 2005 attack in London, which left 52 dead and almost 700 injured. Two months ago, an Islamist rammed pedestrians with an automobile on Westminster Bridge, killing five, including one Romanian. Bucharest joined the international community in condemning Mondays attack, expressing solidarity with the British people. The Romanian authorities have said that no Romanians were among the victims.

SALARIES — The Romanian Senate passed the Unified Pay Scale bill today, which is supposed to raise salaries gradually for state employees until 2022. Labor Minister Lia Olguta Vasilescu told senators that the bill was correlated with the new Fiscal Code, and that it would provide a 56% average salary increase. The minister explained that the law was necessary in order to fix a dysfunctional public wage system. The bill goes next to the Chamber of Deputies, the lower chamber. Public administration trade unions expressed their dissatisfaction at the bill, and announced widespread protests next week all across the country, including the capital. Union leaders said they expect 120,000 to attend the protests.

INVESTIGATION — Former Social Democratic Party chairman Mircea Geoana, defeated in the presidential elections in 2009, and his campaign manager, former Social Democratic MP Viorel Hrebenciuc, are being heard today by the Parliament committee investigating the elections of 2009. On Monday, the committee heard the vice-president of the Permanent Election Authority, Marian Muhulet, and controversial journalist Dan Andronic, whose allegations led to the creation of the committee. The latter specified that he has no further information beyond what he published, and no evidence that the 2009 elections were tampered with. Andronic used to be a political adviser to former president Traian Basescu, who in 2009 won as an incumbent. Andronic claimed that, on the night of the second round of elections in 2009, he met in an informal setting General Prosecutor Laura Codruta Kovesi, former director of intelligence George Maior and his first deputy, Florian Coldea, and that the meeting looked like the gathering of a crisis committee. He further claimed that all the people mentioned risked being fired in case Geoana won the elections.

TRUMP — US President Donald Trump was today in Bethlehem, in the West Bank, and said that he would do everything in his power to help Israelis and Palestinians reach a peace agreement. Trump met Palestinian leader Mahmoud Abbas on the last day of his tour of the Middle East. The Palestinian president pleaded for the two state solution, along the 1967 borders. Israelis and Palestinians have not held direct talks in over 3 years. On Monday in Jerusalem, Trump emphasized the close ties between the US and Israel. He insisted on the threat posed by Iran against world peace, which he also emphasized during his visit to Saudi Arabia. This is Donald Trumps first international tour as president. He continues his tour visiting the Vatican, then attending the NATO summit in Brussels, and the G7 meeting in Sicily.

BUCHAREST — The Romanian economic model within the EU is a topic for debate at a conference held at the Parliament Palace in Bucharest by the Association for Economic and Social Studies and Forecasts. Representatives of the government, business people, academics, and civil society activists are presenting their perspective for the next 10 years with regard to standards of living, education and workforce. According to the latest statistics, Romania has the highest economic growth in the Union. At the same time, the EC has warned Bucharest on its risk of overstepping the stated budget on medium term.

NAVAL — Romanian training ship The Mircea goes today, until 22nd September, on an international training expedition lasting 122 days. It will stop over in 11 ports in 9 countries at the Mediterranean, the North Sea, the Baltic Sea, and the Atlantic Ocean. The 163 members of the crew, of them 70 Romanian students will be joined by 8 cadets from naval academies in Bulgaria, China, Greece and Poland. The crew will go on official visits to the naval academies in Holland, Germany, Portugal and Spain. It will also take part in two prestigious naval events. This year, the Romanian and German military naval forces have signed an agreement on training future officers, unfolding for the duration of this international expedition. 110 cadets and 13 German trainers will be on board the Mircea.

23 May 2017
May 11, 2017

EU MEMBERSHIP – This year, we celebrate 10 years since Romania joined the European Union, said the EC President Jean-Claude Juncker, who addressed a plenary session of the Romanian Parliament. He said that, by Romanias joining the community block, the EU makes its presence felt in the Black Sea region and gained more power at international level. Jean-Claude Juncker has said Romania should become a Schengen member as soon as possible, because it deserves it. As regards a multiple speed European Union, Juncker has said in his speech that this is stipulated in treaties, but he has underlined that there have never been second hand countries in the EU or states left behind on another path. The EU high official has pledged to militate with the Romanian authorities to guarantee the irreversible character of the reforms that have been achieved. Also today, the EC President, Jean-Claude Juncker will meet with Romanian President Klaus Iohannis and Prime Minister Sorin Grindeanu. He will also have a dialogue with the citizens, alongside European Commissioner Corina Cretu, on Europes future and about their role in the European project.

COMMISSION – The plenary session of the Romanian Parliament on Thursday endorsed the proposal of the majority Social Democratic Party-The Alliance of Liberals and Democrats MPs to set up an inquiry commission into the organisation and unfolding of the 2009 presidential elections, won by Traian Basescu. The demarche is started following the disclosures made by journalist Dan Andronic, a head of publication and former political consultant to high ranking dignitaries, among whom former president Traian Basescu. The journalist suggests the electoral process of December 2009 was allegedly influenced by high-ranking state officials, including heads of law enforcement institutions. Following the disclosure, the Prosecutor General opened a criminal record in rem, for abuse of office and forgery of documents and electoral records. The opposition has opposed to the setting up of a parliamentary inquiry commission, saying its activity would reportedly overlap the investigation carried out by the Prosecutors Office.

GROWTH RATE – The European Commission has downgraded its estimates of Romanias economic growth rate this year to 4.3% of the GDP, below the winter estimate which stood at 4.4%. According to the spring economic forecast made public on Thursday, for 2018, the Commission maintains its estimates according to which the growth rate of the Romanian economy is expected to slow down to 3.7%. Relative to the public deficit, it is expected to reach 3.5% of the GDP in 2017, and even 3.8% of the GDP in 2018. The European Commission warns that the unified pay law poses a high risk on fiscal objectives, with a potential impact of up to 2% of the GDP on the economic balance in 2018. Romanias economy is to register a 4% economic growth rate this year, according to the estimates made by the European Bank for Reconstruction and Development, as compared to a 3.7 growth rate estimated in November. The IMF has also revised upward Romanias growth rate this year from 3.8 to 4.2% of the GDP.

EUROVISION – Romania will enter the Eurovision song contest in Kiev, this evening, in the second semi-final, with the piece Yodel It, performed by Ilinca and Alex Florea, and composed by Mihai Alexandru. Romanias representatives are among the first 10 favourites in all tops made so far. After the first semi-finals, held on May 9th, 10 countries, including the Republic of Moldova qualified for the finals. The 2017 Eurovision Song contest finals will be held on Saturday. This years edition has enjoyed the participation of 42 countries. Romanias best performance at Eurovision along the years was achieved in 2005 by Luminita Anghel and the band Sistem, who ranked third, just like Paula Seling and Ovidiu Cernauteanu in 2010.

TENNIS – Romanias best woman tennis player, Simona Halep, no. 8 WTA is today facing Coco Vandeweghe of the US, no. 20 WTA, in the quarter finals of the Madrid tennis tournament with 5.4 million dollars in prize money up for grabs. If she manages to qualify for the semi-finals, Halep will become again no. 4 WTA, after the elimination of Dominika Cibulkova. Also today, the other Romanian player in the competition, Sorana Carstea, no. 83 WTA and holder of a wild-card, will meet in the quarter finals the French player Kristina Mladenovic (France, no. 17 WTA).

11 May 2017
Economic forecast for Romania

The latest economic forecast on Romania’s
economy issued by the European Commission shows the country has registered one
of the fastest growing GDP rates across the European Union. Furthermore,
estimates show this situation will not change throughout the forecast horizon,
2018 included, being backed by fiscal relaxation and pay-rises. Unemployment,
which dropped significantly in 2016, will continue to be at a low level in the
following period of time, whereas inflation, which registered negative values
in 2016, will increase concurrently with the GDP.

According to forecasts, the budget
deficit is likely to increase, following tax cuts and an increase in public
spending. Therefore, the European Commission fears Romania might exceed the
deficit target set by the Romanian Government. Brussels has in fact sent a
letter to Romania on this issue, estimating that Bucharest may see significant
deviations to its medium-term budgetary objectives, with its structural balance likely to
be upset in 2017 and 2018.

Other estimates show, however, that in
the following two years, Romania may see some of the region’s highest levels
both in terms of consumption and economic growth. According to the state budget
endorsed by the Romanian Parliament, the
Government set a budget deficit target below 3% of the GDP, in keeping with the
provisions of the Maastricht Treaty. In an interview on Radio Romania, economic analyst Cristian Păun says we will very soon
find an answer to all these questions, because real figures will soon start to
emerge:

The figures for the first month of the year have already been made
public and they don’t look good. I’m convinced the same will be true of the
figures for the first quarter of the year, because the governing programme lays
emphasis on the redistribution of resources rather than on real measures to
allocate resources. When you redistribute resources in society solely by
raising state sector salaries, you obtain these resources by exerting higher
pressure on the private sector, which can no longer develop at the same pace.
The economic growth of the private sector will slow down, while we will see
higher consumption in the state sector, that is enhanced prosperity thanks to
pay-rises. This is like taking from some people and giving to others. Overall,
the effect is close to zero in terms of economic growth, because we practically
relocate resources to another area within the national economy. This is the
actual effect of redistribution measures.

Other measures taken by the government include increasing the minimum
wage and reducing the level of taxation for small enterprises. Analyst Cristian
Păun:

If taken separately, these measures may be viewed by some as being good
measures. Raising the minimum wage is like a mouthful of oxygen for people with
small salaries and has been supported by many in Romania, particularly trade
unions, and reducing taxation for micro-enterprises has the same effect on
these businesses. In business terms, however, the two measures are
contradictory and the effect is close to zero in the case of a small business.
This means that by increasing the minimum wage and reducing the level of
taxation for small enterprises, we will not see more small enterprises emerging
or developing. Quite the opposite is likely, that is many of these small
enterprises might close, given that, according to statistics, companies’ salary
expenses have increased dangerously in Romania, accounting for 35-40%.

The president of the Fiscal Council in Bucharest,
Ionuţ Dumitru, believes the 5% economic growth rate the 2017 state budget is
based on is very ambitious, and in this respect, budget revenues seem far too
optimistic. The analysis by the European Commission is part of the European
Semester procedure and includes an assessment of the imbalances that still
exist in some member states. According
to these reports, the European Commission identified economic imbalances in 12
EU member states. The situation of these countries will further be monitored,
while Romania only received a formal letter from the Commission that did not
mention any economic imbalances, said the Bucharest authorities.

The Finance Ministry recalls that the Romanian
Government has pledged to implement a governing programme to bring about
sustainable development, ensure investment in infrastructure and create new
jobs, while meeting the budget deficit target of less than 3% of the GDP. This target will be met, the Romanian
authorities give assurances in a letter to the European Commissioners Valdis Dombrovskis and Pierre Moscovici,
despite European Commission estimates that Romania will have a budget deficit
of 3.6% of the GDP in 2017.

17 March 2017
February 14, 2017 UPDATE

SENATE– In a plenary meeting on Tuesday, the Senate of Romania unanimously endorsed an emergency decree that repeals the controversial amendments to the criminal codes, which generated the current political crisis in Bucharest. The draft was sent to the Chamber of Deputies. Amendments can be submitted by Friday, and a plenary session of Parliament is due early next week to vote on the document. The Government building was once again picketed last night by over 1,500 protesters. For two weeks, hundreds of thousands of demonstrators in the country and abroad have been demanding the resignation of the government formed by the Social Democratic Party and the Alliance of Liberals and Democrats in Romania. They accuse the Cabinet of amending the criminal codes in order to exempt influential politicians and local and central administration officers from criminal liability. Concurrently, several hundreds of supporters of the Government request the resignation of President Klaus Iohannis, who they claimed has stepped out of his role as a mediator by joining in the anti-government protests. A referendum regarding the fight against corruption has been initiated by the President, and was approved on Monday by the Senate. Well have more on this after the news.

BUDGET– The President of Romania, Klaus Iohannis, has voiced concern after discussing in Bucharest with PM Sorin Grindeanu and the Finance Minister, Viorel Stefan, about the state budget bill and the social security budget bill, sent to the President for promulgation. The head of state sees the 2017 state budget as problematic, because the budget deficit risks exceeding 3%. In his opinion, the budget bill relies on overestimated revenues and very high expenditure. In exchange, the president of the Social Democratic Party, Liviu Dragnea, said the 2017 state budget is sustainable and it should come into effect without any delays. On Monday, the European Commission estimated that this year Romanias budget deficit would account for 3.6% of the GDP, which might lead to the initiation of the excessive deficit procedure. On the other hand, the economic growth forecast for Romania was improved to 4.4%, which is nonetheless below the 5.2% rate estimated by the Government.

JUSTICE – The High Court of Cassation and Justice in Bucharest has postponed for March 28 the trial of the case in which the Speaker of the Chamber of Deputies and head of the ruling Social Democratic Party, Liviu Dragnea, is charged with instigation of abuse of office. According to the National Anti-corruption Directorate, Dragnea ordered the fictitious employment of two members of his party with the Directorate General for Social Assistance and Child Protection in Teleorman County in the south. The two were paid from public funds although they were actually working for the Social Democratic Party alone. Last year Dragnea received a suspended two-year prison sentence, for having attempted in 2012 to rig a referendum to dismiss then-president Traian Basescu.

FIGHTING EAGLES – The 500 US soldiers of the First Battalion “Fighting Eagles on Tuesday arrived at the Mihail Kogalniceanu airbase in south-eastern Romania. They are equipped with tanks, armoured vehicles and self-propelled mortars. During their nine-month stay in Romania, the US military will take part in the drills, planned jointly with the Romanian Ground Forces. In the opinion of the US ambassador to Bucharest, Hans Klemm, the presence of the US forces in Romania is a confirmation of the strong Strategic Partnership between the two countries. In turn, the Romanian foreign minister, Teodor Melescanu, has said that apart from taking part in missions, the decision to increase defence spending to 2% of the GDP, according to a NATO objective, is further proof of Romanias firm commitment towards its international partners. The deployment of US troops in Romania is meant to strengthen NATOs eastern flank.

TENNIS – Romanias womens tennis team will play against Great Britain at home on April 22 and 23, in the play-offs for Fed Cup World Group II. The drawing was held in London on Tuesday. Last weekend Romania was defeated in Bucharest by Belgium, 3-1, in the first round of World Group II. The national team now has to play to keep its spot in the second group. Fed Cup is the most important international team competition in women’s tennis.(Translated by Ana-Maria Popescu and Diana Vijeu)

14 February 2017
February 12, 2017

RIVAL PROTESTS – Wide-scale antigovernment protests are due in front of the Government offices in Bucharests Victory Square this evening. As of January 31, Romanians have taken to the streets in large numbers, accusing the left-wing Government of trying to amend the criminal law by issuing an emergency decree, partially decriminalising a series of offences to benefit some politicians. The biggest rallies took place last Sunday, when over half a million people took to the streets. On the same day, the cabinet made up of representatives of the Social Democratic Party-The Alliance of Liberals and Democrats repealed the controversial emergency decree. On Thursday, its initiator, justice minister Florin Iordache stepped down. He has been temporarily replaced by Ana Birchall. She announced that on Monday she will have a first meeting with representatives of the Higher Council of Magistracy (CSM), the National Anti-Corruption Directorate (DNA) and the Directorate for Investigating Organised Crime and Terrorism (DIICOT), as well as with all those who have a say in the field of justice. The main aim of the meeting is to find the best solutions in the fight against corruption and in the effort to defend and observe fundamental human rights. For a week, Bucharest has also been the stage of pro-government and anti-presidential protests, but at a smaller scale. President Klaus Iohannis is being reproached for not playing as mediator in the crisis.

FINANCIAL STABILITY– The governor of the National Bank of Romania, Mugur Isarescu, has drawn attention that instability and political tensions in the country have an impact on the monetary and fiscal stability, and might also impact the countrys economic growth this year. The central bank governor has also said the National Bank of Romania forecasts an economic growth rate of 4-5% this year. The National Forecast Commission has recently announced a 5.2% economic growth rate, being more optimistic than the central bank governor.

SOVEREIGN FUND – The Romanian Government has decided to set up the Sovereign Fund for Development and Investment, a new public investment instrument, in compliance with the objectives set by the cabinet under the 2017-2020 governing program. According to the Economy Minister, Alexandru Petrescu, the Fund, which will administer the shares and assets of state-owned companies, will be able to use the income made by profit-making companies, through dividends or by capitalising on non-performing assets, to be traded on the Stock Exchange. The Sovereign Fund for Development and Investment will contribute to both Romanias effort to get the status of emerging market on the local capital market by increasing the level of liquidities on the Stock Exchange and to increase the absorption-rate of non-reimbursable European funds, by providing co-funding for investment projects, the Government announces in a communiqué.

MINIMUM WAGE– On January 1, 2017, Bulgaria and Romania had the lowest national minimum wage level in the European Union. The monthly minimum wage stood at 235 Euros in Bulgaria, and at 275 Euros in Romania, data made public by Eurostat show. 22 of the 28 EU member states have set a national minimum wage, unlike Denmark, Italy, Cyprus, Austria, Finland and Sweden, which have not set such a wage. The highest national minimum wage in the EU is paid in Luxembourg (1,999 Euros), Ireland (1,563 Euro), the Netherlands (1,552 Euro), Belgium (1,532 Euro) and Germany (1,498 Euro). Eurostat says that in 2017, as compared to 2008, the national minimum wage went up in all EU member states, with the exception of Greece, where it decreased by 14%. The highest increase was reported in Bulgaria and Romania, where the minimum wage has actually doubled.(Translated by D. Vijeu)

12 February 2017
February 10, 2017

JUSTICE – Romanias President, Klaus Iohannis, is to make a decision on the proposal made by PM Sorin Grindeanu who nominated the minister delegate for European Affairs, Ana Birchall, for the position of justice minister. The holder of the justice portfolio, Florin Iordache, on Thursday tendered his resignation, although he claimed all initiatives he assumed were legal and constitutional. His decision has been hailed by the opposition parties. We recall that the left wing Romanian Government issued an emergency decree amending the criminal law, according to the proposals made by Florin Iordache. Even if the emergency decree, criticised by the main judicial institutions in the country and by Romanias foreign partners in the EU and NATO, has been repealed by the Government, protests continued on Thursday for the 10th day in a row, in Bucharest and other big cities.

FINANCIAL – The governor of the National Bank of Romania, Mugur Isarescu, has again drawn public attention that instability and political tensions will affect Romanias monetary, financial and even macro-economic stability. The protests staged in recent times, generated by the Governments amending the criminal law by an emergency decree have a significant impact on monetary and financial stability, which will also impact the countrys economic growth this year, the central bank governor warned on Thursday. Mugur Isarescu said the National Bank forecasts an economic growth rate of 4-5% of the GDP this year. The National Forecast Commission has recently announced a 5.2% growth rate this year, being more optimistic than the central banks governor.

ECONOMY – The Romanian coalition Government made up of the Social Democratic Party –the Alliance of Liberals and Democrats on Thursday adopted a memorandum on setting up the Sovereign Fund for Development and Investment. It will be a huge entity bringing together the most significant profit-making state owned companies-approximately 200 of them. Economy minister Alexandru Petrescu has explained the Fund will be a partner for institutional investors, the European Bank for Reconstruction and Development, the European Investment Bank, the World Bank, investment funds as well as other private investors. Well bring you further details after the news.

FRONTEX– The Romanian border police officers this week have rescued to safety over 50 people from the Aegean Sea, as part of a FRONTEX mission. Those rescued – 18 men, 13 women and 21 children-said they originate from such countries as Syria, Iraq, Nigeria and Kuwait. They were on board an overcrowded motor boat, with a high risk of overturning. As of January 1, a team made up of 23 Romanian border police officers is carrying out, for four months, surveillance missions along the EUs external borders, as part of the Joint Operation “EPN POSEIDON SEA, coordinated by FRONTEX. So far, the Romanian policemen have rescued over 330 people.

TENNIS – Romanias Fed Cup team is meeting Belgium at the weekend, in the first round of World Group II. The first two individual tennis matches are scheduled for Saturday, to be followed by the double tennis matches on Sunday. In the absence of Simona Halep, the best ranked Romanian woman tennis player of the moment, no.4 WTA, who sustained an injury, Romanias team is made up of Irina Begu WTA no. 29, Monica Niculescu WTA no. 36, Sorana Carstea WTA no. 62 and Patricia-Maria Tig WTA no. 106. Fed Cup is the womens tennis version of the Davis Cup. (Translated by D. Vijeu)

10 February 2017
Developments in Romanian Trade

In the first three quarters of 2016, Romania registered a deficit in the trade of food and agricultural products, which means that it imported more than it exported, according to data centralized by the Agriculture Ministry in Bucharest. Exports went up by 3% as compared to the first nine months last year, and imports went up by over 9%. The EU remains Romania’s main partner in the trade of food and agricultural products, with imports consisting mainly of fresh and refrigerated pork, bakery products, wheat, sugar and coffee. As regards exports, Romania keeps getting the highest revenues from the delivery of grains inside and outside the EU, especially wheat and meslin flour (a mix of wheat and rye), accounting for 5.2 million tones, worth some 862 million Euro. Cigarillo and cigars come second, followed by rape seeds, corn, sun-flower and barley.

According to an analysis conducted by KeysFin, Romanian e-commerce has registered record results, and in 2016 is likely to exceed 1.4 billion Euro, which is a historic high for Romania. According to the data analyzed, the turnover in the Romanian e-commerce has grown significantly in the past years, from 0.37 billion Euros in 2011 to 1.21 billion Euros in 2015. This growth was registered against the background of a spectacular development of online trade services, currently provided by over 5,300 companies, which is by 2600 more than five years ago. KeysFin statistics show that, as Romanians have become growingly interested in products and services sold online, the profitability of the sector grew from 10.4 million Euro in 2011 to 51.7 million in 2015, and the estimated target for 2016 is some 66.7 million Euro.

The spectacular results of the Black Friday campaign in 2016 are evidence of the fact that Romanian on-line trade is now a national phenomenon. KeysFin analysts have explained that it is not necessarily the discounts, but rather the spectacularly high volume of products sold, which show that Romanians get more and more interested in buying from the so-called ‘virtual malls’. Data show that there are 500 transactions registered per minute, which is twice the maximum level last year, and the biggest transaction was worth some 32.000 Euros, the value of an order sent from Hungary.

(Translated by Mihaela Ignatescu)

19 December 2016
The State of the Romanian Economy

Romanias macroeconomic development has been good, but threats to its financial stability are still severe. Against this background, a careful use of the policy mix is essential. These are conclusions highlighted by the latest report on Romanias financial stability, presented by the National Bank Deputy Governor Liviu Voinea. The main risk is that investors trust in emerging economies might drop fast. There are, however, other risks as well, such as the unpredictability of the financial and banking sector, a lack of clarity as to how the budget is built and concerns about the future of the EU.

Liviu Voinea: “Romania is in a favourable macroeconomic situation, and the risks have diminished. However, there are still many significant threats facing the economy, and that is why the minister in charge of macroeconomic policies should be very careful. As regards the banking sector, it has the ability to cope with unfavourable developments. The solvability rate has remained high, standing at 19% in September 2016, profitability is strong and liquidity is no longer a constraint for banks. All these against the background of a provision coverage rate above the EU average.

According to the Central Bank official, the Romanian economy has registered lately one of the highest growth rates in Europe. Liviu Voinea has explained that the positive dynamics of the economy is sustainable, because most of the surplus demand of the 2011-2016 period has been covered by the domestic supply.

Another conclusion of the report is that the risk posed by legislative instability in the financial-banking sector has lowered, thanks to the decision made by the Constitutional Court regarding the debt discharge bill. In April, the legislative initiatives concerning the discharge of debts and the conversion of loans in Swiss francs were seen as a serious threat.

Liviu Voinea: “Banks will cover their losses in keeping with a multi-year schedule, as a result of the Constitutional Court ruling, and as long as decisions are made on an individual basis, the two laws can no longer be considered loss-incurring events, for the purposes of the European regulations regarding provisions.

Under the debt discharge law, clients who have contracted mortgage loans of maximum 250,000 Euros and can no longer make their payments to banks, may choose to no longer pay the instalments and give up property rights over the respective asset. As regards loans in Swiss francs, they can be repaid in the Romanian currency, at the exchange rate valid on the date on which the contract was signed.

14 December 2016
November 16, 2016 UPDATE

ARREST — The former head of the Permanent Electoral Authority in Romania, Ana Maria Patru, on Wednesday was taken into custody, pending trial, in a file in which she is accused of influence peddling and money laundering. According to the anti-corruption prosecutors, she allegedly demanded and received over 200,000 euros in bribe, in exchange for implementing IT procurement contracts with a particular company, and tried to conceal the source of the money by setting up a fictitious circuit. Ana Maria Patru announced her resignation as head of the Permanent Electoral Authority.

VERDICT — The ex-MEP Adrian Severin on Wednesday was sentenced to four-year imprisonment, in a final ruling issued by the High Court of Cassation and Justice in Bucharest. Anti-corruption prosecutors requested penalties of 6 and a half years for bribe taking and 5 years for influence peddling. Adrian Severin was accused of having accepted the 100,000 euros per year promised by two journalists from “The Sunday Times”, who were running an undercover investigation, in exchange for submitting amendments in the specialised committees of the European Parliament. Two other MEPs, from Slovenia and Austria, also accepted to sell their services to The Sunday Times journalists. Unlike Adrian Severin, they resigned following this corruption scandal.

ECONOMY – In Romania, the hard-won macroeconomic balance must be preserved, the governor of the National Bank of Romania Mugur Isarescu warned once again. The central bank official says that in spite of Romania’s economic growth, encouraging demand and consumption has created jobs in other countries rather than in Romania, given that the demand has been primarily met by imports, which are going up at a much faster rate than exports. Financial-banking analysts estimate that Romania needs a 5% annual growth rate for a long period if it is to recover its development delays compared to Western Europe.

DIPLOMACY — US acting president, Democrat Barack Obama, on Wednesday reiterated the United States’ commitments to its European allies, amidst fears that his successor, right-wing populist Donald Trump, is a threat to democracy, international news agencies report. In a speech delivered in Athens, President Barack Obama said he and President-elect Donald Trump “could not be more different” but he added that American democracy is bigger than any one person. He also said that now, more than ever, the world needs a democratic Europe. In the following days, Obama will meet German chancellor Angela Merkel, French president, Francois Hollande, and the Prime Ministers of Great Britain and Italy, Theresa May and Matteo Renzi, respectively. Afterwards, Obama will travel to Peru, to attend the Asia-Pacific Cooperation Summit. His successor at the White House, Donald Trump, will take over his mandate on January 20, 2017.

INVESTIGATION — Romania’s technocratic PM, Dacian Ciolos, on Wednesday sacked state secretary Adrian Sanda, the head of the Secretariat for recognising the merits of the fighters against the communist regime, in the 1945-1989 period. Also on Wednesday, prosecutors and police conducted more than 20 house searches in several counties in Romania, in a case concerning the status of fighter with a determining role in the 1989 Revolution. The investigation is conducted by the Prosecutor’s Office attached to the High Court of Cassation and Justice, and targets offences like aggravated abuse of office, influence peddling, and forgery of private documents. According to official statistics, in the December 1989 anti-communist revolution, 1,100 people died and over 3,000 were wounded.

SURVEY – 29% of the Romanian household owners choose to give bribe in order to have easier access to public services, this being the highest percentage registered in the whole of the EU, a report issued by Transparency International shows. According to the survey, young people in Romania are mainly requesting a social organisation of the public and business environments, so that access to services and careers no longer be conditioned by the existence of a mechanism of relations. In another move, the report also underlines that public institutions and private companies do not generate a real integrity environment. Civil society in Romania should move on to a new type of approach, in order to enjoy the support of the public at large in the fight against corruption, the report also shows.

BOOK FAIR — Bucharest is hosting until Sunday the 23rd Gaudeamus International Book and Education Fair, the longest-lived and most dynamic book fair in Romania, organised by Radio Romania. The highlights of this year’s fair include events devoted to the Romanian film industry, attended by the directors Cristian Mungiu and Radu Jude, and some of the most recent international releases launched in their Romanian version. This year’s guest of honour is China. During its 96 editions in various Romanian cities in 20 years of existence, the fair has brought together more than 2,600,000 visitors and some 10,500 special events. (Translated by D. Vijeu)

16 November 2016
German investments in Romania

German finance minister, Wolfgang Schäuble, recommends to Romania to step up the process of making investments, also by using European funds and to try to access the Investment Plan for Europe launched by Jean-Claude Juncker, in order to catch up with other European states, relative to this issue. Schäuble travelled to Bucharest for a conference on the business opportunities provided by Romania and met with high-ranking officials here. The German minister said two-way trade exchanges are on the rise and hailed the way in which the Romanian economy is developing.

Wolfgang Schäuble: “Romania has one of the most dynamic economic growth rates in the European Union, which is extremely significant at such difficult moments. It is also worth noting that the indebting rate stands below 40% of the Gross Domestic Product, which is a very important element for a finance minister. I advise you to maintain this level and not put it into jeopardy by taking careless measures”

The German minister said the Romanian authorities should prevent the emergence of conflicts between local and foreign investors, as well as between big companies and SMEs. He also mentioned the relatively low unemployment rate in Romania, pointing however to the fact that, just like in many other European countries, young people are the most affected category from this point of view. He called on the relevant authorities to make use of the so-called dual professional education system, in the effort to solve this issue.

During the talks with Romania’s President, Klaus Iohannis, the German official tackled the EU’s current challenges, among which migration and Great Britain’s leaving the community bloc. Another issue on the agenda of the talks between the two officials was the possibility to reduce the gaps between the EU member states.

The German finance minister also held talks in Bucharest with Romanian Prime Minister Dacian Ciolos, on the prospect of fresh German investments being made in Romania.

According to the Romanian Foreign Ministry, Romania and Germany have jointly built complex and lasting bilateral relations, based on common membership to the EU and NATO. In political and economic terms, bilateral relations have followed an upward trend in recent times, particularly after Romania joined the EU.

An essential role in consolidating bilateral ties is played by the German ethnic minority in Romania, as well as by the ethnic Germans and Romanians who emigrated to Germany and who create a solid bridge between the two countries, at social, cultural, economic and political level.

German President Joachim Gauck paid a visit to Romania in June 2016 and Romanian President Klaus Iohannis travelled to Berlin in February 2015 and September 2016.

Germany is Romania’s largest trade partner, bilateral trade accounting for one fifth of Romania’s foreign trade. Also, Germany is the third largest investor in the Romanian economy (after the Netherlands and Austria), with 4.5 billion Euro, the equivalent of 11.5% of the total volume of investments. (Translated by D. Vijeu)

27 October 2016
October 10, 2016

OFFICIAL VISIT– The President of Slovakia, Andrej Kiska, is on a 2-day official visit to Romania. The agenda includes talks with President Klaus Iohannis, as well as a meeting in the western Romanian village of Nădlac with representatives of the Slovakian minority in Romania. Klaus Iohannis will discuss with his Slovakian counterpart the main topics on the European agenda, given that Slovakia is currently holding the six-month rotating presidency of the EU Council. The two heads of state will exchange opinions on the EU enlargement policy and the eastern neighbourhood, as well as on the reflection on the future of the Union launched at the informal summit held last month in Bratislava. With respect to cooperation within NATO, the Romanian President will reiterate the need for the Alliance to maintain its focus on the Black Sea region, a major component of Euro-Atlantic security, particularly in the context of the current security challenges in the region.

HOLOCAUST COMMEMORATION – The Jewish and Roma victims in Nazi extermination camps are commemorated today at the Holocaust Memorial in Bucharest. The National Holocaust Victim Commemoration Day is celebrated on October 9 in Romania. On this day in 1941, the deportation to Transdniester of the Jewish population of Bukovina and Bessarabia began. The Romanian authorities officially accepted responsibility for the Holocaust in Romania in 2004, based on the conclusions of a commission headed by Nobel Peace Prize winner, Ellie Wiesel.

NOBEL PRIZE – The Royal Swedish Academy of Sciences has announced today the names of the winners of the Nobel Prize in Economic Sciences. Professor Oliver Hart and Professor Bengt Holmstrom of the Massachusets Institute of Technology were awarded the prize, for their insights into how best to write contracts. Their work paved the way for institutions and policies in many fields, from bankruptcy legislation to constitutional policies, the jury explained. The winner of the 2015 Nobel Prize in Economic Sciences was the American professor Angus Deaton, for his analysis of consumption, poverty and welfare. The Nobel prize for Economic Sciences has been awarded since 1968 by the Central Bank of Sweden, unlike the other prizes which are financed by the Nobel Foundation. The 2016 Nobel Prize season concludes this week with the award for literature.

US ELECTION – The nominees of the Republican and Democratic parties in the US election, Donald Trump and Hillary Clinton, Sunday night clashed in the second presidential debate. According to a CNN poll, 57% of the American viewers believe the debate was won by Hillary Clinton, while 34% say the winner was Trump. Also, 39% of the respondents said Hillary Clinton did better than in the first debate. Donald Trump attacked ex-President Bill Clinton, Hillarys husband, and accused her of having “deleted 35,000 emails that had allegedly ruined peoples lives. In turn, Hillary Clinton claimed Russia was getting involved in the US election in order to have Donald Trump win the race. The two candidates also disagreed over the way to handle the crisis in Syria, but according to commentators none of them suggested a concrete solution.

FOOTBALL – Romanias football team is playing on Tuesday in Astana against the national team of Kazakhstan, in its third preliminary game in the 2018 World Cup in Russia. On Saturday, in Erevan, Romania defeated Armenia, 5-0. In the same group E, Poland won 3-2 against Denmark, and Montenegro beat Kazakhstan 5-0. With 4 points each, Romania, Montenegro and Poland top the group table. Last month the national team drew at home against Montenegro, 1-1, in the first game with the German Cristoph Daum as the first foreign manager of the Romanian team. This autumn Romania is to also play at home against Poland, on November 11.

TENNIS – The best ranking Romanian tennis player, Simona Halep, is as of Monday no. 4 in the WTA standings, one place up since last week. Halep is already qualified into the WTA Finals, a tournament that brings together the best 8 players of the world and held this year in Singapore, between October 23 and 30. Angelique Kerber, of Germany, is the WTA leader, followed by American Serena Williams and Polands Agnieskza Radwanska. Four other Romanian players are in the WTA Top 100: Irina Camelia Begu (no. 28), Monica Niculescu (no. 50), and Sorana Carstea (no. 83).

(translated by: Ana-Maria Popescu)

10 October 2016
October 4, 2016 UPDATE

ECONOMIC GROWTH – The International Monetary Fund has updated its estimates on Romanias economic growth rate from 4.2% in April to 5% in its latest report, released on Tuesday. According to the IMF forecast, this year Romania will have the highest economic growth rate in Europe, followed by Ireland with 4.9%. IMF experts warn that this years peak growth will be followed by a slow-down to 3.8% in 2017, slightly over the 3.6% rate estimated in April, but even so, next year as well Romania is expected to see the highest growth pace in Europe.

COUNTRY PROJECT – The country project will be a strategic document, a “brief, clear, easy to understand text outlining the broad directions of development for Romania, President Klaus Iohannis said on Tuesday, at the end of the first meeting of the Presidential Committee tasked with drawing up the project. President Iohannis came up with the idea of setting up this task force after consultations with political leaders regarding Brexit revealed the need for a country project in the new European context. The committee, made up of two representatives of each parliamentary party and a representative of the government, is coordinated by two presidential advisers. Eleven specialists in various expert fields, well connected to European realities, are also part of the committee.

TENNIS – The Romanian Simona Halep (no. 5 WTA), seeded fourth, Tuesday qualified into the eighth-finals of the WTA tournament in Beijing, after defeating the Belgian Yanina Wickmayer (no. 56 WTA), 6-2, 6-2. Halep and Wickmayer had played 4 other times against each other, with the Belgian player winning three of the games. China Open has 5.4 million USD in total prize money.

4 October 2016
September 8, 2016 UPDATE

THE STATE OF THE ECONOMY– Romanias technocratic Prime Minister, Dacian Ciolos, will go to Parliament to present the economic situation of the country, the government spokesperson, Liviu Iolu announced on Thursday. The spokesman said the Prime Minister is thus answering the request made on Thursday, too, in an open letter, by the president of the leftist Social Democratic Party, Liviu Dragnea. The Social Democrats leader claims, among others, it is high time the cabinet presented its official stand on such measures as establishing a ceiling for child rearing benefits and increasing taxes on incomes from independent activities.

ANTI-CORRUPTION – Romanias president Klaus Iohannis on Thursday approved a request by the National Anti-corruption Directorate to start prosecuting former interior minister Petre Toba. The latter is suspected of aiding some of his staff accused of embezzlement. As a result of the scandal, Toba resigned and was replaced by Dragos Tudorache. The priorities of the new minister include the good organisation of the parliamentary elections on December 11.

DIPLOMACY – Romanian foreign minister, Lazar Comanescu, on Thursday met in Bucharest with Turkish deputy prime minister, Veysi Kaynak. On this occasion, Comanescu reiterated Romanias openness towards boosting bilateral ties, particularly trade relations. In another move, the Romanian foreign minister reiterated Romanias interest in maintaining stability in Turkey, a NATO member and a key partner of the EU. Comanescu also gave assurances that Romania would like Turkey to join the EU. According to the Romanian Foreign Ministry, the visit by the Turkish deputy prime minister is proof of the dynamic and fast pace of the political dialogue between the two countries.

ROMANIAN-UKRAINIAN RELATIONS – Romania is one of the most important supporters of Ukraines independence, sovereignty and territorial integrity, said the Ukrainian charge daffaires in Bucharest, Teofil Rendiuk at a reception to celebrate Ukraines National Day. Rendiuk also said Romania may become Ukraines new strategic partner and that the two countries have an excellent dialogue adapted to the current geopolitical and geostrategic situation. Bucharest was a firm critic of Russias annexation of the Crimean peninsula and voiced its support for Ukraines sovereignty, independence and territorial integrity within this countrys internationally recognised borders.

REP. OF MOLDOVA – Nicolae Timofti, the president of the ex-Soviet Republic of Moldova, with a majority Romanian-speaking population, has refused to travel to the meeting of heads of state of the Commonwealth of Independent States to be held next week in the capital of Kyrgyzstan. The Moldovan delegation may thus be headed by Prime Minister Pavel Filip. Moldovas pro-western president Nicolae Timofti, who is nearing the end of his term in office, did not attend the summit last year, either, following a tough exchange with his Russian counterpart Vladimir Putin in 2014 most likely over Moldovas signing the association agreement with the European Union and Russias embargo as a result.

CHRISTIAN HOLY DAY – Christians across the world, including the majority Orthodox Romania, on Thursday celebrated the Feast of the Nativity of Mary, which is known as Little Mary in the traditional calendar. According to Christian tradition, Mary, the mother of Jesus, was born through a miracle. She is believed to be the greatest of all saints and is dedicated four days in the Christian calendar: Nativity, Entry into the Temple, Annunciation and Assumption. Around 2.2 million people are named after Mary in Romania.

SAILING – An international regatta of large sailboats began on Thursday in the Romanian port of Constanta. 13 sailboats from five different countries will be docked for four days in the passenger harbour, where they can be visited free of charge. Romania is represented in the race by the Mircea training ship and the countrys largest civilian sailboat, Adornate. Romanian navy personnel will take part in various sports competitions and a crew parade on Friday. (Translated by D. Vijeu)

8 September 2016