Tag: excessive deficit procedure

  • May 25, 2023 UPDATE

    May 25, 2023 UPDATE

    Strike — The strike in the education system in Romania continues, after the unions rejected the latest offer made by the government, which they consider offensive. The teachers were to receive 2,500 lei this year, in two installments, and the non-teaching staff 1,000 lei. The money would have been granted on a “professional career card”. The trade unions are asking for a rise in incomes of 25% and a law under which the salary of a beginner teacher should be the equivalent of the average gross salary. A new round of negotiations took place on Thursday in Bucharest. Employees in the pre-university education system started an all-out strike on May 22, dissatisfied with the level of salaries and working conditions. The union leaders have stated that they will not give up the protest until their demands are resolved.



    Deficit – The European Commission Executive Vice-President, Valdis Dombrovskis on Wednesday called on the member states to more effectively apply their plans of recovery and resilience, to make investments and cut on spending. The European Commission has again drawn attention to the economic situation in Romania, the only EU country for which the excessive deficit procedure has been activated. According to Brussels, Romania spends more money than it has and must cut its deficit under 3% by the next year. According to the Romanian government, the budget deficit is expected to go down under 4.4% of the GDP this year and 2.9% next year.



    Visit — Currently, “a real war is going on in Europe” said, on Thursday, in Sibiu (center), the president of the Federal Republic of Germany, Frank-Walter Steinmeier, who reiterated the call for unity in this context. ‘Since the beginning of Russia’s war of aggression against Ukraine, we have considerably strengthened NATOs Eastern Flank and have considerably expanded our cooperation in the field of security policy. Both within the European Union and within NATO, our countries collaborate closely, based on trust’, the German official emphasized. Romania’s President, Klaus Iohannis, stated, in turn, that the Romanian-German friendship, with an old tradition, has now reached an unprecedented point of development. The two met with the representatives of the German community in Romania and visited the “Samuel von Brukenthal” National College, with tuition in German, a school attested in documents almost 650 years ago. The German president is on a state visit to Romania until Friday.



    Football – Sepsi OSK Sfantu Gheorghe won Romanias football cup after a 5-4 win against Universitatea Cluj in the shootouts on Wednesday evening. 120 minutes into the game, the score was nil-all. The hero of Sepsi was its goalkeeper, Roland Niczuly, a former player of Universitatea Cluj. Niczuly managed to save three shots, after Universitatea had got the upper hand but wasted two chances. Sepsi has won the trophy for the second time in a row. We recall that this ambitious football side from central Romania, lost the finals of the aforementioned competition in 2020. Universitatea Cluj was left with the trophy they won in 1965, losing the Romanian Cup finals for the fifth time.



    Moldova – Less than 0.5% of the citizens of the Republic of Moldova who spent their holiday abroad last year chose the Commonwealth of Independent States – CIS as their destination – reveals a study published in Chişinău. The research appeared in the context in which the Moldovan government made the decision to withdraw from the CIS, given the fact that one of its founding members, Russia, attacked another founding member, Ukraine. 40% of the citizens of the Republic of Moldova would, however, like the country to remain in the CIS, and Moscow claims that, by leaving the organization, the Republic of Moldova risks losing economic advantages. Official statistics show, however, that the commercial relations of the Republic of Moldova are currently mainly oriented towards the European Union. The Republic of Moldova wants to join the European Union “as soon as possible” in order to protect itself from the Russian threat and hopes for a decision “in the next few months” regarding the opening of negotiations, President Maia Sandu had previously said.



    Banks – The banks in Romania will have to issue new repayment schedules, where the amount of the principal on the loan will be paid by consumers in equal installments over the entire loan term, said the general director of the National Authority for Consumer Protection, Paul Anghel. Also, the president of the institution, Horia Constantinescu, pointed out that he had already signed the orders to stop these deceptive practices for 11 banks that were previously fined because the installments was mainly composed of interests in the first years of repayment. The Authority for Consumer Protection announced on Thursday that eight other banks were sanctioned for the way in which they calculate loan rates. Moreover, the Authority notified the Competition Council over what it called the cartel attitude of some banking institutions. However, the Romanian Association of Banks contradicted the Authority and showed that this calculation method was included in the Romanian legislation since the setting-up of regulations on lending activity. (LS)

  • European Commission cautions Romania

    European Commission cautions Romania

    The European
    Commission has again referred to the economic situation in Romania, at present
    the only EU Member State targeted by the excessive deficit procedure (EDP)
    based on evolutions prior to the pandemic. The warning comes as the Commission
    has published a set of general fiscal, financial and economic recommendations
    for each Member State. Brussels does not want to take other similar actions in
    the upcoming period, Commission vice-president Valdis Dombrovskis says, arguing
    that a re-assessment of criteria to meet debt and deficit targets will be made
    this autumn and next year in spring. In particular, the Commission wants Member
    States to comply with recommendations in the European semester, vice-president
    Dombrovskis also pointed out, adding that investments should be doubled by a
    very firm control of current spending.

    As regards Romania, the European
    official said our country’s budget deficit for 2022 complies with the EU
    Council recommendations, which is why the EDP is kept in standby. But since
    there are substantially larger risks for the current year, more efforts are
    needed to attain the set targets, Valdis Dombrovskis went on to say. According
    to European officials, Romania is overspending at present, and needs to bring
    the budget deficit below 3% by 2024. The Commission’s recommendation is that
    the government should cut support measures in the energy sector, which are
    currently in place until the end of 2023, and use the resulting savings to
    curtail the deficit. Another recommendation is to ensure efficient governance
    and consolidate administrative capabilities so as to allow for a continuous,
    swift and constant implementation of the recovery and resilience plan. Romania
    was given six months to solve all the issues signaled by the Commission with
    respect to certain milestones or targets in the National Recovery and
    Resilience Plan, which it has not properly fulfilled. State Secretary with the
    Ministry of Investments and European Projects, Carmen Moraru explained that
    only the funds earmarked to these projects can be suspended, not the entire
    €2.8 bln representing the second installment disbursed to Romania. Referring to
    the current phase of its implementation, Carmen Moraru said the plan stipulates
    funding contracts worth €26 bln, addressing the ministries of development,
    transports, education and the environment, which launched major projects. (VP)