Radio România Internațional

Tag: inflation

  • Economic Forecasts for Romania

    Economic Forecasts for Romania

     

    Romania no longer leads the EU ranking in terms of the highest average annual inflation rate, but remains among the top 3 countries, the EU Statistics Office reports.

     

    After 10 months of unwanted leadership of this ranking for our country, in January 2025 Hungary climbed to first place, with 5.7%, followed by Romania, with 5.3% and Croatia, with 5 percent.

     

    The average rate of consumer price increase is calculated over the last 12 months, and in this case it compares the figures reported in February 2024 – January 2025 with the period February 2023 – January 2024.

     

    In the European Union, this indicator reached 2.8% last month, from 2.7% in December 2024, while in the Eurozone it rose to 2.5% in January, from 2.4% in December. The European Central Bank has set a 2% inflation target, which it views as healthy for economic growth in the EU.

     

    In Romania, according to data released by the National Statistics Institute, the year-on-year inflation rate dropped from 5.14% in December to 4.95% in January 2025, as food prices rose by 4.54%, non-food prices by 4.60%, and prices for services by 6.54%.

     

    Last week, the National Bank of Romania adjusted the inflation forecast for the end of this year from 3.5% to 3.8%. The Governor of the National Bank of Romania, Mugur Isărescu, said that inflation would be fluctuating in the first half of this year, then it would stay on a slight downward trend, but it would not fall below 3.5% until the first quarter of 2026. He expects Romania to see a period of lower deficit, which is good for inflation, but could affect economic growth:

     

    Mugur Isărescu: “The country enters a period of decreased demand, so let’s see how it works. The important thing is for this new situation, combined with the fiscal policy, the monetary policy, not to lead to recession. If economic growth is based mainly on investments and especially on EU fund absorption, we believe this can be avoided and we can have decreasing inflation. We are talking about economic growth—not great, but growth nonetheless.”

     

    The central bank governor also explained that in the future as well, inflation remains marked by risks and uncertainties, both domestic and foreign. Among the domestic elements affecting inflation, Isărescu listed the electoral year marked by political and social tensions, while for external elements he mentioned a possible trade war between the United States of America and the European Union, which he said could have significant negative effects on Romania.

     

    In this context, Mugur Isărescu appreciated the decision of the Romanian government to declare the absorption of EU funds as a top priority, and emphasised that revitalising investments is important. For the end of 2026, the central bank of Romania predicts a 3.1% annual inflation rate. (AMP)

  • February 17, 2025

    February 17, 2025

    Energy – The Romanian government is to make a decision this week regarding the continuation of the current compensation-capping scheme for electricity and natural gas prices for domestic consumers. The energy minister, Sebastian Burduja, said however that he supported a better targeting of this support to those vulnerable consumers for whom the payment of utilities represents too big a burden. A government decision is to be implemented through an emergency ordinance.

     

    Inflation – The National Bank of Romania (BNR) Governor, Mugur Isărescu, presents, today, the Quarterly Report on Inflation. According to a National Bank statement sent to AGERPRES on Friday, the annual inflation rate will record a pronounced fluctuation in the first semester of 2025, and in the second semester it will decrease on a higher trajectory than the one in the previous projection. Based on the evaluations and available data, as well as in the context of high uncertainties, the BNR Board of Directors decided to maintain the monetary policy interest rate at the level of 6.50% per year. Also, the BNR decided to maintain the current levels of the mandatory minimum reserve ratio for liabilities in lei and in foreign currency of credit institutions.

     

    Paris – The leaders of the main European powers are having an emergency meeting, today, in Paris, to discuss European security and the war in Ukraine. Participating are the prime ministers of Germany, Great Britain, Italy, Poland, Spain, the Netherlands and Denmark, the president of the European Council, the president of the European Commission and the NATO secretary general, the French presidency announced. Today’s talks could later be expanded into other formats, with the aim of bringing together all partners interested in peace and security in Europe. The meeting in Paris takes place at a particularly delicate moment in the relationship between the European Union and the United States, after the initiatives taken in recent days by American President Donald Trump and his team to negotiate peace in Europe directly with Vladimir Putin, the European countries and Ukraine being excluded from decision-making, Radio Romania’s correspondent reports. On the other hand, the US Secretary of State, Marco Rubio, stated that Ukraine and Europe would be involved in ‘real negotiations’ for peace. According to Reuters, Rubio’s statement suggests that the meeting between the U.S. and Russian representatives, which will take place in the next few days in Saudi Arabia, is just a move for Washington to feel the pulse and see if Moscow is really willing to negotiate. The Russian-American talks will begin on Tuesday in the capital of Saudi Arabia, Riyadh, the BBC reports.

     

    Germany – Germany is getting ready for Sunday’s parliamentary elections, in a more polarized climate than ever over immigration, further inflamed by the Trump administration’s open support for the far right, AFP reports. According to surveys, the nationalist anti-immigration movement AfD will take second place in the legislative elections, with at least 20% of the votes, behind the conservatives, who are rated at 30-32%. In a speech delivered at the Munich Security Conference, the U.S. Vice President J.D. Vance urged the traditional parties in Germany, and the classical right in particular, to give up the ‘protective wall’ or ‘sanitary cordon’ that they established after the Second World War to refuse to govern with the extreme right. I refuse such interference in the German parliamentary elections and in the formation of the government that will follow in Germany. I will not let an American vice-president tell me who I should talk to here in Germany’, said the leader of the Christian Democrats, Friedrich Merz, a favorite in the polls to become the next chancellor. In turn, the social-democratic chancellor, Olaf Scholz, described the intervention of the American vice-president as unacceptable. Instead, AfD leader Alice Weidel welcomed J.D. Vance’s statements and emphasized the similarities between her program and that of the Trump administration.

     

    Motion – The motion of censure aimed at Romania’s coalition government led by the social democrat Marcel Ciolacu will no longer be submitted to Parliament today, the president of the opposition Alliance for the Union of Romanians (AUR), George Simion announced. In a Facebook post, he said that he expected all the opposition MPs, including those from the Save Romania Union (USR) and the Young People’s Party (POT), to join the initiative. The AUR leader added that he expected a reaction from them by Friday. The motion of censure, signed by 125 elected representatives from S.O.S. Romania and AUR, had to be submitted in Parliament today. At the moment of gathering the signatures, the USR president, Elena Lasconi, advised her colleagues not to support the initiative, on the grounds that Romania needs calm and stability. (LS)

  • Budget for 2025, promulgated

    Budget for 2025, promulgated

     

    The outgoing president Klaus Iohannis signed the decrees promulgating the 2025 state budget and social security budget laws. The two bills had been quickly endorsed last week in the joint plenary meeting of the Romanian parliament. MPs in the opposition—AUR, Save Romania Union, SOS Romania and the Young People’s Party—submitted thousands of amendments, but these were dismissed one by one by the vote of the ruling coalition, comprising the Social Democratic Party, the National Liberal Party and the Democratic Union of Ethnic Hungarians in Romania.

     

    The opposition claimed that many amendments were rushed away without careful consideration. The budgets of ministries, on the other hand, were adopted as received from the reporting committees, and one of the few amendments to pass concerned an increase in the funding of the health ministry. Another amendment scrapped the approx. EUR 140,000 originally earmarked to the Constitutional Court of Romania for covering medical prescription claims for employees and retired judges.

     

    The draft budget for 2025 was passed by the government on February 1 and is based on a 2.5% economic growth rate and a budget deficit of 7% of GDP. The 2025 budget will enable the country’s development process to continue, PM Marcel Ciolacu said. He emphasised that higher amounts have been earmarked for the health ministry, for motorways and railways, as well as for education, and he dismissed the idea of ​​an austerity budget.

     

    In turn, the finance minister Tanczos Barna described the state budget for 2025 as “modest” and based on a prudent increase in revenues, “without exaggeration.” He claimed that there is “enough money for salaries, pensions and social benefits”.

     

    The budget was criticised not only by the opposition, but also by employers and trade unions, while Fiscal Council experts said that revenues were overestimated.

     

    The 2025 budget was finalised after late last week an IMF delegation completed its talks in Bucharest with the main institutions responsible for Romania’s monetary and fiscal policies. It was not an assessment mission, but only a fact-finding one, and PM Marcel Ciolacu assured the IMF of the government’s determination to comply with the budget deficit target of 7% of the GDP and to implement the reforms undertaken in the National Recovery and Resilience Plan.

     

    The IMF made public its latest forecasts regarding the Romanian economy last autumn, when it estimated a 7% deficit for the end of 2025, the same as predicted by the Government. The IMF estimates are, however, more optimistic both in terms of the economic growth rate (3.3%, compared to only 2.5% forecast by Bucharest) and inflation (3.6%, below the 4.4% target set by the government). (AMP)

  • January 14, 2025 UPDATE

    January 14, 2025 UPDATE

    Meeting – The Romanian Prime Minister Marcel Ciolacu on Tuesday had talks in Bucharest with the US Deputy Secretary of State for Europe and Eurasia, James O’Brien, about the progress made in deepening the bilateral strategic partnership in the fields of security, economy and the Visa Waiver. During the meeting with the Foreign Minister, Emil Hurezeanu, the American official showed confidence in the solidity of the Romania – US Strategic Partnership and in its capacity for further development based on ongoing bilateral projects. In turn, the Romanian minister appreciated the US contribution to the security and defense of NATO’s Eastern Flank, as well as to the development of the strategic approach regarding the Black Sea region. The Defense Minister, Angel Tîlvăr, also highlighted, during the meeting with the US official, the crucial role of the Black Sea region in ensuring European and transatlantic security, in the context of the continuation of the Russian Federation’s war of aggression in Ukraine. Angel Tîlvăr emphasized Romania’s firm commitment to NATO’s collective security and appreciated the substantial contribution of the US in ensuring the security of the Alliance’s Eastern Flank. On Monday, James O’Brien was in Chisinau, where he declared that the development of the transport infrastructure in Romania, the Republic of Moldova and Ukraine will create a new opportunity for the economic development of the three states.

     

    Energy – Romania has no problems in terms of energy supply for the entire cold season, the energy minister Sebastian Burduja gave assurances again, on Tuesday, after the Winter Energy Command meeting. He specified that the measures established to increase domestic production, including coal-based production, were applied. According to him, energy production from gas is still the main source of electricity production during the cold season, except for days when the wind blows and wind power plants are the first source of production in Romania.  The Energy Minister also emphasized that the domestic demand for natural gas is not affected by daily exports to the Republic of Moldova.

     

    Gas – Half of the electricity consumed in the Republic of Moldova (ex-Soviet state with a majority Romanian-speaking population), on the right bank of the Dniester River, comes from internal sources, including renewable energy, and the other half comes from imports from Romania, the Moldovan president, Maia Sandu said on Tuesday, in a press conference. She convened a meeting of the Supreme Security Council which tackled the situation in the energy sector and assistance measures for the population. On the other hand, Maia Sandu says, the energy and humanitarian crisis in the separatist region of Transdniester is caused by the Russian Federation with the aim of destabilizing the political situation in the Republic of Moldova. We remind you that since January 1, the Transdniester region has no longer received natural gas from Russia.

     

    Inflation – The annual inflation rate went up to 5.14% in December 2024 from 5.11% the previous month, amidst a 5.09% increase in the price of foodstuffs, 4.38% in the price for non-foods and 7.10% in the cost of services, according to National Statistics Institute data made public on Tuesday. Compared to 2023, the annual inflation rate in December last year stood at 5.5%. The National Bank of Romania upgraded its inflation forecast for the end of 2024, from 4% previously to 4.9%, and estimates the inflation rate will go down to 3.5% at the end of 2025.

     

    Tennis – The Romanian tennis player Gabriela Ruse, coming from the qualifications, defeated another Romanian player, Irina Begu, 6-4, 6-0 in the opening round at the Australian Open tennis tournament on Tuesday. In the next round, Ruse will take on Madison Keys of the United States, who knocked out Ann Li of the USA in the first round. This is the second time Gabriela Ruse reaches the main draw in Melbourne after in 2022 she reached the second round. Another Romanian player, Jaqueline Cristian, is playing Lucia Bronzetti of Italy in the second round. (LS)

     

  • December 30, 2024 UPDATE

    December 30, 2024 UPDATE

    GOVERNMENT On Monday, during its last meeting this year, the government of Romania passed an emergency order cutting down public sector spending in 2025. The bill agreed on by the leaders of the ruling coalition (comprising the Social Democratic Party, the National Liberal Party and the Democratic Union of Ethnic Hungarians in Romania) includes measures such as suspending public sector employment or freezing pensions and salaries of public sector employees at the 2024 level. In addition, overtime will no longer be paid and no bonuses or premiums will be granted. The government claims that these measures are aimed at reducing public spending by almost EUR 4 billion, i.e. 1% of GDP. To this end, the Cabinet has set up a department made up of experts working pro bono to increase the efficiency of the government’s work. The state budget law for next year will be passed by the government in January and sent to Parliament for endorsement in a special session.

     

    PROTESTS Penitentiary police Monday picketed the Government headquarters in Bucharest, protesting the measures to reduce public expenses. They claim they would lose up to 30% of their salaries because of the enforcement of the new provisions. Also on Monday, several trade union and employer organisations in Romania issued statements criticising the measures designed to cut expenditure in the public system. Trade unions in the education sector are against the salary freeze, while the largest trade union federation in public administration and social assistance, Columna, complains that the order had been drafted without social dialogue. The energy sector employers federation also cites the lack of consultations, criticising the introduction of a tax on special constructions. The Romalimenta Employers’ Federation warns that the food industry is receiving another blow with the cancellation of tax facilities benefitting employees in the sector. In turn, representatives of small and medium-sized enterprises say that lowering the tax threshold for SMEs and increasing the tax on dividend will have catastrophic effects for Romanian entrepreneurs. The American Chamber of Commerce in Romania also voiced concerns about the fiscal measures adopted by the Government, which, it believes, put the business environment in a difficult situation and further affect economic predictability and investor confidence.

     

    PRICE HIKES Romanians will be paying more for petrol and diesel as of January 1, due to a 6% rise in the fuel excises, according to a document released recently by the Finance Ministry. A litre of petrol will cost 3 Eurocents more, and diesel will have almost the same price. Excises on alcohol beverages will also grow by 4.4% as of January 1. Local taxes and duties will be adjusted to the inflation rate, but the decision in this respect is going to be made by city halls. The Bucharest General Council has decided to raise these taxes by 10.4%.

     

    UNEMPLOYMENT The unemployment rate in Romania was 3.28% at the end of November 2024, with the total number of unemployed people reaching 261,511, the National Employment Agency announced. At the end of October, the national unemployment rate was 3.20%. Unemployment in rural areas is almost 3 times higher than in cities. The 40-49 age bracket and men have the highest share among the unemployed. Middle school graduates account for 33.56% of the total registered number of unemployed people, while those with university degrees only account for 4.56%.

     

    BORDERS The Romanian Border Police is ready to join the Schengen area with land borders as of January 1, 2025, when border controls will be eliminated at 40 road, rail and port checkpoints. According to a statement issued by the Border Police General Inspectorate, as of next year travelling to and from other Schengen member states will be similar to a trip within the country. However, people who intend to travel to the territory of another Schengen state must have a valid travel document, namely a passport or identity card, because Romanian border police will carry out random checks, the statement also reads.

     

    DIPLOMACY Romania’s foreign ministry Sunday night said that on December 18 the Romanian ambassador to NATO conveyed Romania’s disapproval over the distribution of a geographic atlas comprising maps featuring the so-called, ‘greater Hungary’. “The atlas is of an inflammatory nature with respect to the strategic partnership between Romania and Hungary and their capacity as NATO allies. The foreign ministry in Bucharest reiterates the view it has consistently conveyed to the Hungarian authorities, that any provoking statement and gesture is not likely to help consolidate the partnership relations between Romania and Hungary. The shared history must remain a subject for historians to study,” Bucharest says. Dismantled at the end of World War I, the so-called ‘greater Hungary’ included territories occupied by Budapest, which today belong to Romania, Slovakia, Croatia and Slovenia. (AMP)

  • The Week in Review

    The Week in Review

    A look at the headline-grabbing events of the past week.

     

     Schengen members, at last

     

    The good news of the week, officially confirmed on Thursday, has been Romania’s full accession, alongside with Bulgaria, to the European ​​free movement area. At the end of March, the European partners had agreed to welcome the two states into Schengen with air and sea borders. After the Netherlands and especially Austria decided to no longer oppose, the Justice and Home Affairs Council unanimously approved on Thursday the accession of Romania and Bulgaria with land borders to the Schengen area, as of January 1. Starting with this date, there will be no more checks except at Romania’s borders with Serbia, the Republic of Moldova and Ukraine. However, in the first six months after accession, there will still be alternative or random checks, a security measure to see how the free movement works. Such temporary checks have also been initiated on various internal borders in Schengen, amid an increase in illegal migrants. The authorities in Bucharest welcomed the country’s acceptance into Schengen, emphasizing that the decision translates into faster movement for citizens, lower logistics costs for companies, increased competitiveness of Romanian products and services on the European market as well as business opportunities and jobs.

     

     

    Unfinished election marathon

     

    At the beginning of the week that is ending, Romanians should have known the name of their next president. The second round of the presidential elections had been scheduled for December 8, and should have marked the end of the electoral marathon that began in June with the local and European parliamentary elections. On December 6, however, the Constitutional Court cancelled the election for president, after finding that the electoral process was flawed by multiple irregularities and violations of the electoral legislation. The direct beneficiary of this electoral process, hijacked by Russia’s hybrid attacks, according to intelligence services, would have been the winner of the first round, the independent candidate Călin Georgescu, a pro-Russian extremist, who is also anti-West and an admirer of the fascist leaders of the Romanian interwar period. The Prosecutor’s Office is now investigating two of his close associates, former mercenaries. One of them, suspected of planning to cause unrest in the capital Bucharest, is being investigated for failing to comply with the arms and ammunition laws, operations with pyrotechnic objects and public incitement, and the other for using legionary symbols, which had been used by the anti-Semitic and criminal extreme right of the 1930s. The Financial Times carries the opinion of analysts, according to whom the attractiveness of paramilitary groups in Romania, with very “macho” visions, which combine religion with ultra-nationalism, has increased because the authorities have not intervened.

     

     

    Pro-Europeans in the future Parliament negotiate on a joint government

     

    President Klaus Iohannis, whose mandate will be extended until the election of his successor, convened the new Parliament on December 20. Four pro-European parties, PSD, PNL, USR, UDMR and three self-proclaimed sovereignists, AUR, SOS Romania and POT, will be part the future Parliament, following the December 1st elections. With almost two-thirds of the mandates, the pro-Europeans, joined by the deputies of national minorities, other than the Hungarian one, have began negotiations this week for a broad coalition government. We recall that, before the second round of the presidential elections, PSD, PNL, USR, UDMR and the group of national minorities had signed the pact for a pro-European and Euro-Atlantic coalition. The document was aimed at blocking Călin Georgescu’s access to the highest position within the state. After the election was cancelled, the signatories of that document renewed their commitment and now promise a governing program focused on development and reforms, which will take into account the priorities of citizens. They agreed that a clear plan is needed to streamline and reduce public spending and bureaucracy in public administration. They also agreed to increase the current pace of investments and reforms under the National Recovery and Resilience Plan.

     

     

    Inflation, the never-ending problem

     

    The future executive in Bucharest will face a number of challenges, including restoring trust in the political class and reforming state institutions and, last but not least, economic problems. One of the latter is generated by inflation. Fueled by price increases in postal services, fresh fruit and margarine, the inflation rate increased again compared to the previous month. The annual inflation, reported in November 2024 in comparison with the one November 2023, increased again for the second consecutive month, reaching 5.11% from 4.67% in October. One of the causes of the increase in inflation is the high budget deficit, which the Government is struggling to finance, analysts explain. The latest forecast of the Central Bank shows that inflation will fall below 3.5% per year only in 2026.

     

     

    Sports week

     

    Romania’s football champion, FCSB (Bucharest), drew an equal score with the German team Hoffenheim, on Thursday evening, away, in the 6th round of the Europa League. The Bucharest team is ranked 10th in the group and is very close to qualifying for the European spring. They still have two matches to play in January, the last of which is at home against the famous English team Manchester United. In handball, the Romanian women’s national team ranked 11th at the European Championship hosted by Austria, Hungary and Switzerland.

  • Inflation on the rise again

    Inflation on the rise again

    Postal services, fresh fruit or margarine were among the most expensive items in Romania in November this year, show data published by the National Institute of Statistics, according to which the annual inflation rate increased, again, compared to the previous month. More precisely, it reached 5.11% of the Gross Domestic Product, from 4.67% in October. It thus reached a level similar to that recorded in August, and also to that recorded in May. It shows the oscillating trajectory that the indicator followed in 2024, after it decreased from 6.61%, as it had been in December 2023. Romanians had to take more money out of their pockets, especially for fresh fruits, over 6.5% and also for electricity, approximately 3.4%. On the other hand, in November compared to October, air transport services recorded a decrease of over 8.2%, followed by thermal energy almost 5%.

     

    Statistics for the last 12 months reveal price increases for postal services, with average increases of almost 18%, followed by fresh fruit with over 17% and margarine, with approximately 16%. Compared to November 2023, the prices of foods increased, on average, by 5%, and of services by 7.5%.

     

    Financial analyst Adrian Codirlaşu, president of CFA Romania, an association that brings together investment professionals is here with details: ʺAs to the services component, if we look at all the monthly reports, we see that it remains consistently at high levels. We have had successive increases in the minimum wage. Most of the workers, paid with the minimum wage, are in this services component, and therefore, on the services side, we had an increase in cost, which is then reflected in prices, as is normal. Hence this slight increase in inflation. We also have a high budget deficit. The high budget deficit is inflationary. Why? Because the action of the Government, when issuing debt to finance it, is practically the equivalent of printing money, money that seeks to buy goods and services, so it increases demand and automatically prices.”

     

    For 2025, analysts anticipate an inflation rate around 5%, with a higher value being possible at the beginning of the year. The National Bank of Romania has revised upward, to 4.9%, the inflation forecast for the end of 2024 and anticipates that it will reach 3.5% only at the end of next year. But nothing is certain! Fiscal policy and salary increase at the national level, as well as, externally, the evolution of the European economies, the dynamics of the oil price or the conflicts in Ukraine and the Middle East generate uncertainties. (LS)

  • December 12, 2024

    December 12, 2024

     

    SCHENGEN The EU interior ministers convening in the Justice and Home Affairs Council have decided to lift controls at internal land borders with and between Bulgaria and Romania, starting with 1 January 2025. “Through the coordinated efforts of Romanian authorities, through steps at political and diplomatic level, we can finally enjoy a well-deserved right, legitimately acquired by Romania”, president Klaus Iohannis said, welcoming the decision announced in Brussels. “The advantages of our membership in the free movement area are multiple and have a direct impact on citizens, on the economy and on the image of our country. Scrapping border controls means faster and simpler movement for those who travel, the time spent at the borders will be considerably reduced, and logistics costs for companies will decrease, which will rapidly increase the competitiveness of Romanian products and services on the European market. Romania’s attractiveness to foreign investors will also increase considerably”, the head of state also said. “It is a historic decision, a victory for justice and national dignity and a clear signal that we will never accept being second-class citizens in Europe,” PM Marcel Ciolacu also stressed. “It is, above all, a triumph of all Romanians, regardless of their political choice or social situation, a victory for teamwork,” the PM added. The European Commission welcomed the unanimous decision of the JHA Council, noting that “The full accession of both countries not only strengthens the Schengen Area, but will further consolidate the internal market, increase travel, trade and tourism. A solid Schengen Area strengthens the unity of the EU and makes the EU stronger on a global scale.”

     

    GOVERNMENT Negotiations continue in Parliament to define a government programme for the pro-European coalition. The talks are taking place between the Social Democratic Party, the National Liberal Party, the Save Romania Union and the Democratic Union of Ethnic Hungarians in Romania, as well as the ethnic minorities group. According to the negotiations so far, the new cabinet would have only 15 or 16 ministers at most, and a small number of state secretaries. The distribution of these positions among the coalition parties is yet to be decided. The structure of the new government should be finalised by the end of the week. In addition, the coalition party leaders are also to decide on the new parliamentary majority will operate and who will take over the leadership of the two chambers. The new parliament is due to convene next Friday for a first session, in which the new senators and deputies will be validated.

     

    SALARIES In Romania, net average wages per month in October reached around EUR 1,050, up 12.3% compared to the corresponding month in 2023, the National Statistics Institute announced on Thursday. The highest values ​​were reported in the IT&C sector, and the lowest in the textile industry. According to the Institute, average net earnings increased in October compared to September in most economic sectors. In the public sector, in October, salary increases were operated in education and public administration. In healthcare and social assistance, average net earnings decreased slightly compared to the previous month.

     

    INFLATION The annual inflation rate in Romania rose to 5.11% in November, as against 4.67% in October. Compared to November 2023, food prices rose by 5%, and services by over 7.5%, according to the National Statistics Institute. The National Bank of Romania has revised upwards its inflation forecast for the end of the year, to 4.9%.

     

    FOOTBALL The Romanian football champions, FCSB, are taking on the German side Hoffenheim tonight in Sinsheim, in the 6th round of the Europa League group stage. With three wins, a draw and a defeat, FCSB has 10 points and is in 10th place. The Romanian champions hope for another victory, which will improve their chances to rank among the top 8 teams qualified straight into the round of 16. Hoffenheim has 5 points, with one win, two draws and two defeats, and is in 25th place, one place below the play-off qualification zone. (AMP)

  • December 11, 2024

    December 11, 2024

    Schengen – The full accession of Romania and Bulgaria to the Schengen area from January 1 will be on the agenda of Thursday’s meeting of the EU Justice and Home Affairs Council. Austria has recently announced that it will give up its right of veto that blocked the Schengen accession of the two countries with land borders as well. The argument was that the Austrian authorities’ insistence on combating illegal immigration led to a decrease in the number of migrants intercepted near the border of Austria with Hungary, the most frequent entry route into the country. The only uncertain thing is the maintenance, after January 1, of controls at the land borders between Hungary and Romania and between Romania and Bulgaria for a period of at least six months. These controls would be necessary to mitigate a possible change in migratory routes and to prevent any serious threat to public order or internal security. We remind you that Romania and Bulgaria partially joined Schengen with air and sea borders at the end of March.

     

    Inflation – The annual inflation rate rose, in November, to 5.11%, from 4.67% in October, as the price of foods and non-foods rose by over 5%, and services by over 7%, show data published by the National Institute of Statistics. The National Bank of Romania has revised upward, to 4.9%, from 4% previously, the inflation forecast for the end of 2024. The national bank also anticipates that inflation will reach 3.5% at the end of 2025.

     

    Stock exchange – The Bucharest Stock Exchange closed Tuesday’s session with all indices rising for the third consecutive day. The main index, BET, which includes the 20 most traded listed companies, grew by almost 1%. The Bucharest Stock Exchange has announced that it is exploring the options of establishing a stock exchange in Chişinău, in order to build a robust capital market in the neighboring state. Thus, the aim is to stimulate bilateral cooperation and a wider access to financing for companies from the Republic of Moldova, which, together with those from Romania, will become regional leaders over time.

     

    Negotiations – In Romania, the Social Democratic Party – PSD and the National Liberal Party – PNL (in the current governing coalition), Save Romania Union – USR, the Democratic Union of Ethnic Hungarians in Romania – UDMR and the group of national minorities have agreed to jointly form a government and a pro-European parliamentary majority. The four parties and the national minorities, which together hold about two-thirds of the Legislature, will work on a common governing program based on development and reforms aimed at reducing public expenses and bureaucracy in the administration. They also agreed to increase the current pace of investments and reforms from the National Recovery and Resilience Plan. Regarding the presidential election, the pro-European parties have pledged to support a possible common candidate.

     

    NATO – Romania remains firmly committed to the assumed Euro-Atlantic path, and the decision to make our own contribution to strengthening security in the region remains solid, the Romanian Defense Minister, Angel Tîlvăr, said. Together with the ambassador of the United States in Romania, Kathleen Kavalec, he visited the Mihail Kogălniceanu air base (south-east), where he met with a delegation made up of defense attachés from NATO member countries, accredited in Bucharest, and with the allied military who carry out their activity there. (LS)

  • November 19, 2024

    November 19, 2024

    A roundup of local and international news.

     

    MESSAGE – Despite 1,000 days of terrible warfare, Ukraine stands unbowed, the US Ambassador in Bucharest, Kathleen Kavalec has said today in a statement, marking 1000 days since Russia’s full-scale invasion of Ukraine. She also said that, according to the UN, Russian forces have killed more than 11,000 Ukrainian civilians, including more than 600 children, and continue to engage in shocking war crimes, including torture of civilians and prisoners of war. At the same time, Russian bombs have obliterated schools, hospitals, and treasured sites of Ukrainian history, culture, and memory. According to the American diplomat, Ukraine has shown remarkable courage and resolve in defense of its sovereignty, territorial integrity and independence, helped by the enduring support of its friends and allies around the world. Romania has shown true leadership in support of Ukraine and its citizens and, as strategic partners and NATO allies, the United States and Romania stand together to counter the threats posed by Russia in Ukraine and in Europe, Kathleen Kavalec also said.

     

    RUSSIA – Moscow continued to criticize Joe Biden’s decision to allow Ukraine to use American long-range missiles to attack Russia. Deputy National Security Adviser for the Biden Administration, John Final, emphasized the fact that Russia is waging a war of aggression. However, Joe Biden’s decision was criticized by President-elect Donald Trump’s team members. They accuse Biden of escalating the conflict two months before leaving office. On the other hand, on Monday, Ukraine marked 1,000 days since Russia’s large scale invasion of its territory. The invasion led to the destruction of numerous Ukrainian towns and cities, and 6 million people were forced to flee the country. Thousands of civilians were killed during the bombings. On the battlefield, losses are described by Reuters as catastrophic and estimated at hundreds of thousands of dead and wounded on both sides.

     

    ELECTIONS – These are the last days of the election campaign for the first round of the presidential elections in Romania, scheduled for Sunday, November 24. There are 13 candidates for the position of head of state, nine proposed by political parties and four independents. The head of the Permanent Election Authority, Toni Greblă, says that it is possible that, by late Monday, November 25, the official results of the election be announced. The second round of the presidential elections is scheduled for December 8.

     

    INFLATION – The annual inflation rate in the European Union rose to 2.3% in October, from 2.1% in September, and Romania is, for the eighth month in a row, the country with the highest inflation rate in the community bloc, with an annual price increase of 5%, according to data published on Tuesday by the European Statistical Office (Eurostat). Last month, the lowest annual inflation rates in the EU were recorded in Slovenia (0.0%), Lithuania and Ireland (each 0.1%), while the highest were in Romania (5%), Belgium and Estonia (each 4.5%). The National Bank of Romania has revised upwards, to 4.9%, from 4% previously, the inflation forecast for the end of 2024 and estimates that it will reach 3.5% at the end of 2025, according to data presented on Monday by the Governor of the National Bank of Romania, Mugur Isărescu.

     

    FOOTBALL – The Romanian national football team defeated Cyprus 4-1 on Monday night at home in its last match in Group C2 of the Nations League. The Romanians thus won their fifth victory in the group and advanced to the competition’s League B. Romania still has to wait for UEFA’s decision for the match against Kosovo on Friday in Bucharest, abandoned by the guests with only a few tens of seconds before the end, at a goalless score, when they heard pro-Serbian chants from the host fans. The Kosovo Football Federation denounced what it saw as an “unacceptable and unsafe atmosphere”. The Romanian Football Federation rejected the accusations as unfounded.

  • November 12, 2024 UPDATE

    November 12, 2024 UPDATE

     

    VISIT Romania’s PM Marcel Ciolacu is on official visit to the UK on Tuesday and Wednesday, where he has meetings with the British Prime Minister Keir Starmer, the Speaker of the House of Commons, Sir Lindsay Hoyle, and the Lord Mayor of London, Alastair King. According to a Government press release, PM Marcel Ciolacu will also attend the Romania-UK Economic Forum, and will meet with members of the Romanian community. “The government is interested in consolidating the Strategic Partnership with the United Kingdom of Great Britain and Northern Ireland, in all fields of bilateral interest, responding to changing challenges and opportunities. The Romanian community in the UK is big, and fostering the rights of our compatriots is a key pillar of bilateral cooperation”, PM Marcel Ciolacu said. This is the first visit of a Romanian Prime Minister to the UK in 17 years.

     

    EC Roxana Mînzatu, nominated by Romania for European commissioner, said during her interview by the European Parliament’s specialist committees that Europeans will face many challenges in the coming years, and they need to be prepared for this, which is the first pillar of her programme. The second pillar, which she described as a key one, concerns quality jobs. The third element of her term in office is social justice. Roxana Mînzatu, nominated for executive vice-president of the EC for people, skills and preparedness, has been interviewed by the members of the Committee on Employment and Social Affairs and the Committee on Culture and Education. Roxana Mînzatu, 44, was a state secretary with the Ministry for European Funds in March-September 2015. In 2016-2020, she was a member of the Romanian Parliament, and in 2019 she also served as Minister for European Funds. In June this year she was also elected MEP, backed by the Social Democratic Party. Roxana Mînzatu has a Bachelor’s degree in political sciences and a Master’s degree in European integration.

     

    ELECTION Some 200 postal votes for the parliamentary and presidential election in Romania have already arrived from Romanians living abroad and will be counted together with the other votes, the chairman of the Permanent Election Authority (AEP), Toni Greblă, has said. 6,650 citizens have requested to vote by post and must send their options no later than two days before the start of the vote in the country. The first round of the presidential election is slated for November 24, the second round for December 8, while the parliamentary election will take place on December 1.

     

     

    INFLATION The annual inflation rate climbed from 4.62% in September to 4.67% in October, the National Statistics Institute reports. Food prices went up by 4.75%, while prices for non-food products also increased by 3.45%. Service prices also went up 7.66%. The National Bank of Romania has adjusted its inflation estimate for the end of 2024, from 4% previously to 4.9%. The Bank expects the inflation rate to go down to 3.5% at the end of 2025, according to a report made public by Governor Mugur Isărescu this Monday. On the other hand, Romania’s trade deficit went up 15% in the first 9 months of 2024, reaching some EUR 23.5 bln, the National Statistics Institute reports. Exports have exceeded EUR 69 bln, a 1.4% drop, while imports totaled nearly EUR 93 bln, accounting for a 2.3% increase.

     

    GOTECH WORLD Officials and representatives of the business sector took part in the opening of GoTech World 2024, an event hosted by Bucharest over November 12-13. This year’s edition of B2B Expo brings together over 120 experts from the sector and nearly 100 exhibitors. Organizers expect a turnover of some 15,000 guests. GoTech World (previously known as Internet & Mobile World) is the biggest conference and expo in Central and Eastern Europe, as well as a regional hub for digital economy, providing professionals in the region with access to B2B tech solutions, insights into various digital fields and networking opportunities. (VP, AMP)

  • October 11, 2024

    October 11, 2024

    Inflation – The inflation rate in Romania dropped, in September, to 4.62%, after, in August, it had registered a value of 5.1%. This is the official data of the National Institute of Statistics published today. The prices for foodstuffs have increased, on average, by 0.8%, and for services by approximately 0.4%. Spectacular price hikes were recorded in the case of citrus fruits and other exotic fruits, approximately 7.5%. Prices of vegetables and canned food also went up by over 5%. Significantly increased prices were also recorded for beans and other legumes. Potatoes, on the other hand, became cheaper by approximately 5.23%, and other products by less than 2%. In the case of services, postal rates increased by 17.8%, air transport by 17.2%, and non-foods such as detergents by 14.7%. The prices for water supply and sanitation services also recorded a 12.6% increase.

     

    Commissioner – The designated European Commissioner of Romania, Roxana Mînzatu, will be heard, on Saturday, by the committees of the European Parliament. MEPs from the Committee on Employment and Social Affairs and from the Committee on Culture and Education will participate in the hearings. Another two committees, the one on women’s rights and gender equality and the Committee on civil liberties, justice and home affairs will have a guest status, in the sense that they will have the right to ask the commissioner proposed by Romania a written question. Roxana Mînzatu was appointed executive vice-president of the European Commission and could hold, in the next five years, the portfolio on employment, social affairs and education.

     

    Concert season – “Ode to Joy ” was scheduled to open, this evening, the new concert season of Radio Romania’s orchestras and choirs. The show at the Radio Hall, conducted by the Austrian Sascha Goetzel, is designed around one of the most famous works in the history of music, the Symphony No. 9 by Ludwig van Beethoven. At the absolute premiere in Vienna, on May 7, 1824, Beethoven was turned to face the audience to see the applause which he could no longer hear at all, due to his total hearing loss. “Ode to Joy” is the first musical score included in the UNESCO world heritage.

     

    Nobel – The Japanese Nihon Hidankyo movement won, on Friday, the Nobel Peace Prize for the year 2024, for “its efforts to reach a world without nuclear weapons”, the Norwegian Nobel Committee announced, according to international press agencies. The Nobel Peace Prize is the only one awarded in Oslo, the prizes for the other categories being awarded in Stockholm. The Norwegian Nobel Institute registered 286 candidacies for this year’s award, including 197 individuals and 89 organizations. Last year, the Nobel Peace Prize was awarded to the Iranian Narges Mohammadi “for her fight against the oppression of women in Iran and her fight to promote human rights and freedom for all”.

     

    Schengen – Austria continues to oppose the admission of Romania and Bulgaria to the Schengen Area with land borders. The problem was discussed, on Thursday, in Luxembourg, at the meeting of the European Ministers of Justice and Home Affairs. Although the European Commission and the European Parliament say that both countries meet all the conditions for accession, Austrian Minister Gerhard Karner claims that there is still a lot to be done. The European Commissioner for Home Affairs Ylva Johansson expressed optimism that the Council of the EU will decide to remove border checks at the Bulgarian and Romanian Schengen borders before her term ends. She added that the accession of Romania and Bulgaria would be discussed again during the Council meeting in December.

     

    Elections – 14 candidates will be registered on the ballots in the first round of Romania’s presidential election on November 24 – 10 supported by political parties and 4 independents. On Thursday evening, the Central Electoral Bureau established, by drawing of lots, the order in which the candidates will appear on the ballot, but one of the candidates announced the intention to challenge the procedure. The deadline for Romanian citizens domiciled or residing abroad to register to vote by mail in the presidential elections expired at midnight. According to the data of the Permanent Electoral Authority, less than 7,000 people registered on the votstrainatate.ro platform. The second round of the presidential election will take place on December 8. (LS)

  • Government made its first budget revision this year

    Government made its first budget revision this year

    The Bucharest Government approved the first budget revision of this year, which will trigger an increase in the budget deficit. According to Prime Minister Marcel Ciolacu, the revision is sustainable, because 84% of the deficit represents expenses for investments, and the money will return multiplied to the budget state. The correction is positive and is based on the increase in revenues and the increase in the deficit to 6.9%. The Prime Minister pointed out the fact that investments and not consumption would continue to be supported. He gave as an example the highways, which will bring back eight times more money than was spent on their construction.

     

    Marcel Ciolacu: “It is natural for the state to first transfer the money to the Minister of Transport, Sorin Grindeanu, who gives it to the companies, they finish our highways, which we have been waiting for for 30 years, and, with a delay of a month or two, taxes return to the state. Moreover, in the next period, at least what it is invested in the infrastructure multiplies in the economy up to eight times. You put in one euro, you get 6 or 8 euros back, in the area where we have directed a lot of investments at the moment.”

     

    The Prime Minister also said that the reduction of unnecessary public expenditure would continue. In his opinion, the budget deficit must be an exclusively general investment deficit. Following the revision, health, transport and education receive additional funds.

     

    Social insurance budgets are also being increased for the payment of recalculated pensions, which have increased since September 1, but also for unemployment allowances and related social insurance contributions. The Ministries of Health, Internal Affairs, European Projects, Agriculture and Energy will also receive additional funds.

     

    On the other hand, other main authorizing officers will have smaller budgets. These include the General Secretariat of the Government, the Ministry of Economy, the Senate and the Chamber of Deputies, the Special Telecommunications Service, but also the Ministry of Development. The budget revision proposal is based on the increase in revenues and expenses, which have gone up significantly. According to specialists, this will lead to a deficit of 2% above the authorities’ estimate of 5% at the beginning of this year. All these in the context of a revised downward economic growth forecast, from 3.4 to 2.8% of GDP. The National Strategy and Forecast Commission (CNSP) estimates a GDP growth of 3.5% for 2025, and 3.7% for 2026. Inflation at the end of the year is forecast at 4.5%, above the Central Bank target of 4%, to decrease to 3.8% next year and to 2.9% in 2026. The trade deficit will increase, according to the Forecast Commission, to 32.7 billion euros this year, from 28.9 billion euros last year, after an advance in exports (1.8%) and imports (4.5%). The average exchange rate is projected at 4.98 lei/euro for this year, and the average net monthly salary could rise by 14.8% in 2024, to 5,066 lei (approx. 1020 euros).

  • September 11, 2024

    September 11, 2024

    Legislation – The defense committee of the Romanian Senate is meeting today, with Defense Ministry representatives being expected to join, most likely to discuss the legislation in the field, in the context of the entry into the Romanian airspace of some Russian drones launched against neighboring Ukraine. In the night of Saturday to Sunday, residents of Tulcea and Constanţa counties (south-east) were warned by RO-Alert messages about the possibility of objects falling from the airspace. Later, the army identified fragments of a drone of Russian origin in uninhabited areas near the town of Periprava. The Romanian Defense Ministry sent a firm message to condemn these Russian attacks against Ukrainian civil infrastructure targets and elements, which are unjustified and in serious contradiction with the international law. The Romanian diplomacy reiterated its firm protest against the violation, once again, of Romania’s airspace and categorically demanded the cessation of the repeated attacks against the Ukrainian population and civil infrastructure.

     

    Inflation – The annual inflation rate in Romania dropped, in August 2024, to 5.1%, from 5.42% in July, in the context in which foodstuffs prices rose by 4.25%, non-foods prices by 4.35%, and the price of services by 8.60%, according to data published on Wednesday by the National Institute of Statistics (INS). The National Bank of Romania (BNR) revised downwards the inflation forecast for the end of 2024 to 4%, from the previous 4.9%, and anticipates that it will reach 3.4% at the end of 2025, according to the data presented in August by Governor Mugur Isărescu.

     

    Decorations – The Romanian athletes who won medals at the Olympic and Paralympic Games in Paris will be decorated, this evening, by President Klaus Iohannis, according to an announcement on the Facebook page of the Romanian Olympic and Sports Committee (COSR). At the Paris Games, both Olympic and Paralympic, Romania obtained a total of four gold, four silver and three bronze medals. Visually impaired Florin-Alexandru Bologa, 28, won a gold medal in para judo, in the men’s -73kg J1 category. Camelia Ciripana won the bronze in para table tennis, the women’s singles. In the Olympics Games, Romanian athletes won three gold, four silver and two bronze medals. The gold medal was obtained in swimming by David Popovici, in the 200 m freestyle event, in rowing, the double sculls event, by Andrei Sebastian Cornea and Marian Florian Enache, and in the women’s eight plus one event by the crew made up of Maria Magdalena Rusu, Roxana Iuliana Anghel, Nicoleta Ancuţa Bodnar, Maria Lehaci, Adriana Adam, Amalia Bereş, Ioana Vrînceanu, Simona Geanina Radiş and Victoria Ştefania Petreanu. The silver was won by Mihaela Valentina Cambei in weightlifting – 49 kg, Gianina Elena van Groningen and Ionela Livia Cozmiuc in the women’s lightweight double sculls, Ioana Vrînceanu and Roxana Iuliana Anghel, in the women’s pair and Simona Geanina Radiş and Nicoleta Ancuța Bodnar, in the women’s double sculls. David Popovici won bronze in swimming, in the 100 m freestyle, and Ana Maria Bărbosu, in artistic gymnastics, in the floor event.

     

    Elections – The electoral period for the presidential election in Romania begins on Thursday, with the establishment of the Central Electoral Bureau (BEC), according to the timetable approved by the Romanian Government. The BEC members will be appointed by drawing of lots, and a day later the president of the bureau will be elected by secret ballot. Next, candidacies must be submitted by October 5 at the latest and the election campaign will begin on October 25. Romanian citizens with their domicile or residence abroad can vote by mail, and the deadline for submitting requests in this regard is September 24. The first round of the election for the highest office in the Romanian state will take place on November 24, and the second on December 8. Also, Romanians will be called to the polls on December 1, on the National Day, for the general elections to elect their representatives in the Romanian Parliament.

     

    Law – The Romanian Senate adopted a draft law to amend the Criminal Code that provides for a similar legal practice for human trafficking and pimping carried out by coercion. At present, pimps can escape prison sentences, in some cases, if, for example, the victims declare that they were not forced to have sex for money. All parliamentary groups supported the initiative. This amendment to the Criminal Code must also receive a favorable vote in the Chamber of Deputies to become law. On the other hand, the list of prohibited psychoactive substances in Romania has been recently updated. 14 new names were added to the list of narcotics. 13 fall into the category of very high-risk drugs, and one into the category of high-risk drugs.

     

    Music – The 12th edition of the Bucharest Music Film Festival event will take place between September 14-22, in George Enescu Square in the center of Bucharest. According to the organizers, the festival is relaunching in a new concept and offers the public evenings of concerts in a variety of musical styles, from the classical repertoire to jazz, from film music to pop fusion, bringing to the fore hundreds of artists and renowned orchestras. The event is organized by the Capital City Hall, through ARCUB – the Cultural Center of the City of Bucharest and is held under the auspices of Bucharest Days, thus marking 565 years since the first documentary attestation of the city. Public access is free. (LS)

  • August 20, 2024 UPDATE

    August 20, 2024 UPDATE

     

    CANDIDACY The leader of the Social Democratic Party, PM Marcel Ciolacu, will run for president of Romania. Just days ahead of the party congress, he announced his fellow party members of his decision. “I am confident that together we will manage to once again win a presidential election, after 20 years. Romania needs stability and balance,” Ciolacu said.

     

    CSP10 The geopolitical environment is marred by mistrust and disrespect for the international order, which leads to the escalation of regional conflicts and a new arms race, said the Romanian Foreign Minister, Luminiţa Odobescu. The head of Romanian diplomacy is taking part until Friday in the Conference of States Parties (CSP10) to the Arms Trade Treaty (ATT), which is being held in Geneva, under the presidency of Romania. In her address, the Romanian minister highlighted the celebration of 10 years since the entry into force of the Arms Trade Treaty, underlining its essential role in the current geopolitical context, as well as the importance of cooperation between all actors involved in reducing human suffering, promoting peace, security and international stability. Also, Luminiţa Odobescu pointed out the priorities of the Romanian Presidency of the CSP10, which ends on 23 August, 2024. Romania’s priorities included encouraging a dynamic dialogue between member states regarding the effective implementation of the Treaty, universalisation activities and measures to increase the transparency of conventional arms exports and imports.

     

    AGRICULTURE Romania is safe in terms of food security, even if this year was a dry one, the Agriculture Minister, Florin Barbu, said on Tuesday in a specialised conference. According to him, Romania produced almost 1.7 million tons of wheat more than last year, and it will have a very good corn crop. Florin Barbu also pointed out that the agriculture ministry must take urgent measures, because this year, due to climate change and drought, more than two million hectares have been affected throughout the country. He also mentioned the importance of investments in the irrigation system in Romania, stating that currently over 1.6 million hectares of land are rehabilitated and irrigated. According to the National Institute of Statistics, last year Romania’s wheat output was over 9.6 million tons, on an area of ​​2.2 million hectares, while the corn kernel output was over 8.5 million tons on almost 2.4 million hectares.

     

    INFLATION The annual inflation rate in the European Union went up to 2.8% in July, from 2.6% in June, according to data released on Tuesday by the EU statistical office, Eurostat. The EU members with the highest inflation rates last year were Romania (5.8%), Belgium (5.4%) and Hungary (4.1%). The EU countries with the lowest inflation rates were Finland (0.5%), Latvia (0.8%), and Denmark (1%).  As compared to the month of June, the inflation rate went down in 9 EU members, remained stable in 4 countries and grew in 14 other. In July Romania reported an inflation rate of 5.8%, from 5.3% the previous month.

     

    VISIT The Romanian Defense Minister, Angel Tîlvăr, Monday received the Minister of Defense Pål Jonson and the Minister of Civil Defense Carl-Oskar Bohlin from the Kingdom of Sweden. High on the agenda of talks were the security situation in the Black Sea and Baltic Sea regions, against the backdrop of Russia’s war of aggression against Ukraine, cooperation within NATO, the implementation of the decisions of the Washington Summit, the evolution of projects developed within the European Union, as well as participation in missions and operations under the EU aegis. “Sweden has a significant contribution to Euro-Atlantic security, once it has joined NATO. We act together to promote and implement Allied measures on the entire eastern flank of the North Atlantic Alliance and to strengthen bilateral cooperation, including in terms of preparing our armies for the challenges of the future”, said Angel Tîlvăr. The officials reiterated their constant support for Ukraine, as well as for the Republic of Moldova, and highlighted the importance of maintaining a constant political and military dialogue, in order to streamline and harmonise joint efforts in the field of defence. (AMP)