Radio România Internațional

Tag: National Bank of Romania

  • November 12, 2024

    November 12, 2024

    VISIT – Romania’s Prime Minister, Marcel Ciolacu, is paying an official visit to the UK on Tuesday and Wednesday, where he is expected to meet 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, Prime Minister Marcel Ciolacu will also attend the Romania-UK Economic Forum, and will meet with representatives 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 the 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”, Prime Minister Marcel Ciolacu said. This is the first visit of a Romanian Prime Minister to the UK in 17 years.

     

    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 demanded to vote by post and must send their options no later than two days before the start of the voting process proper. 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 in October to 4.67% from 4.62% in September, the National Statistics Institute reports. Foods prices went up by 4.75%, while prices for non-food products also increased by 3.45%. Services also went up 7.66%. The National Bank of Romania has upgraded 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 nine months of 2024, reaching some 23.5 bln EUR, the National Statistics Institute reports. Exports have exceeded 69 bln EUR, a 1.4% drop. Imports totaled nearly 93 bln EUR, accounting for a 2.3% increase.

     

    GOTECH WORLD – Officials and representatives of the business sector are attending 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 from the region with access B2B tech solutions, insight into various digital fields and networking opportunities.

     

    ENESCU – For the first time in the history of Romania, all four violins owned by composer George Enescu will be on the same stage in November 2024, as part of a national tour. The violins are currently in the collection of the “George Enescu” Museum in Bucharest and are classified as “national treasures”. The tour kicks off on November 12 at the Culture Palace in Iași (northeast).  Gabriel Croitoru will be performing on the 1731 “Cathedral” Guarnieri del Gesù violin, Simina Croitoru on the 1931 Paul Klaul violin, Paul Răducanu on the 1930 Paul Klaul and Mircea Dumitrescu on the 1835 Frères Pierre and Hippolyte Silvestre. The tour will then  travel to other cities across the country, before moving to Bologna (Italy). The four violins were donated to the Romanian state by George Enescu’s wife, Maria Cantacuzino-Enescu, upon the foundation of the Museum in 1956.

     

    HEARING – The remaining six European Commissioners, designated for the positions of European Commission executive vice-presidents, including Romania’s nomination, Roxana Mînzatu, are today taking part in hearings before the European Parliament’s special committees. Designated European Commission Executive Vice-President for People, Skills and Preparedness, will appear before the Committee for Labor and Social Affairs, and before the Committee on Culture and Education. According to Agerpres, Romanian MPs from various political groups say EU Commissioners will pass today’s hearings with little effort.  (VP)

  • November 8, 2024 UPDATE

    November 8, 2024 UPDATE

    SALARIES – The average annual adjusted salary of a Romanian full-time employee is the fourth lowest in the European Union. Eurostat data show an annual increase of approximately 2,500 euros for 2023, but the total value remains less than half of the EU average. On the other hand, the data published by the National Institute of Statistics show that most of the unemployed in Romania are adults between the ages of 25 and 74. The NIS draws attention to the level of unemployment among young people, those aged between 15 and 24, which exceeds 23%. In September, the national unemployment rate stood at 5.5%, similar to that of August, which had, however, increased slightly compared to the previous month.

     

    EPC – On the sidelines of the European Political Community summit held in Budapest, EU leaders called on US president-elect Donald Trump to avoid trade wars, to maintain support for Ukraine and to refrain from disrupting global order. On Friday, talks focused on increasing EU competitiveness, with leaders adopting a joint declaration reflecting a number of goals designed to boost competitiveness, which will guide the activity of EU institutions over the coming period. The president of Romania, Klaus Iohannis, warned that migration remains an important challenge at European level, which requires a common and comprehensive response. Talks during the plenary session stressed the significant impact of the Russian aggression against Ukraine on the entire continent, but also at global level. They emphasized the need for coordinated action at European level to support Kyiv. At the meeting on supporting the Republic of Moldova, the European leaders also pledged to keep providing the necessary support so that the state can continue the reforms and the fight against external interference.

     

    INFLATION – The annual inflation rate will go up slightly in the final months of the current year and will see a heightened fluctuation in the first semester of 2025, remaining above the target range and the previously anticipated values, the Central Bank reports. Major uncertainties and risks arise from the impact of fiscal and revenue policies, considering the fiscal and budgetary measures that might be implemented starting next year for the purpose of budgetary consolidation. Labor market conditions and wage dynamics also remain a source of uncertainty and risk. At the same time, significant uncertainty continues to be associated with the evolution of energy and food prices, as well as the future trajectory of the price for crude oil, against the backdrop of geopolitical tensions. The National Bank’s board of directors on Friday decided to maintain the monetary policy interest rate 6.50% per year. The Bank is closely watching developments on the domestic and international levels and is prepared to use the instruments at its disposal in order to fulfill the fundamental goal of ensuring price stability in the medium term, with a view to preserving financial stability.

     

    FLOODS – Madrid authorities announced 78 people are still missing, 10 days after the most devastating storms that occurred in the last century in this country. The most severely affected region was Valencia. The official death toll stands at 219. In Valencia alone, 211 bodies have been recovered so far, the other eight victims being discovered in the neighboring regions of Castilla–La Mancha and Andalusia. Other regions of Spain were subsequently hit by further episodes of severe weather. The clean-up operation is in full swing, but some of the 75 affected towns and villages are still covered in mud. Many buildings are still inaccessible or difficult to access, as the entrances are partially blocked by vehicle debris and household items. (MI&VP)

  • Mugur Isărescu is re-elected governor of the National Bank of Romania

    Mugur Isărescu is re-elected governor of the National Bank of Romania

    The National Bank of Romania needs continuity of leadership, as well as the transition to a younger generation of specialists, the Bank’s current and future governor Mugur Isărescu told Parliament on Tuesday. Aged 75, he has led the Bank almost uninterruptedly since 1990. He only stepped down for one year, between 22nd December 1998 and 28th December 2000, to serve as prime minister of Romania. After interviews with the specialist committees, Parliament again entrusted him with a new mandate to head the National Bank, making him the longest-serving governor of a central bank in the world. For his new term, Isărescu promised his institution would cut the inflation rate without causing recession and ensure price stability without discouraging long-term economic growth:

    “It’s a well-known fact that amid relatively stable prices and a reasonable growth target, in our case 2.5%, give or take 1%, the economy does better. There is a big chance that we may have both macroeconomic stability and sustainable economic growth. Like in the past, we will seek to ensure price stability without disrupting financial stability”.

    Leonardo Badea, as first deputy governor, Florin Georgescu and Cosmin Marinescu, as deputy governors and representatives of the Social Democratic Party, the National Liberal Party and the Democratic Union of Ethnic Hungarians in Romania were also given the green light by Parliament to form the Board of Directors. The Save Romania Union criticised the fact that no one from the opposition is part of the Bank’s executive leadership. MP Claudiu Năsui:

    “The fundamental objective of the National Bank should be to ensure price stability, not something like helping the government at key moments by setting lower interest rates and easier debts.”

    The Liberal MP Florin Roman responded:

    “If your proposals had been fair and right, I believe they would have got our vote. So, let’s not be hypocrites and stop electioneering.”

    The leader of the Alliance for the Union of Romanians George Simion criticised the MPs’ lack of professionalism:

    “We could, for example, look closely at the CVs of those proposed by you for the National Bank and see if everything is all right, if they really have the qualifications for their comfortable and well-paid jobs.”

    The term of the leadership team for the National Bank is 5 years.

  • October 1, 2024

    October 1, 2024

    A roundup of local and international news.

     

     

    NATO – A ceremony marking the transition to the new NATO Secretary General is being held in Brussels, in which Jens Soltenberg hands over the mandate to the new chief of the Alliance, Mark Rutte, the former Prime Minister of the Netherlands. With 10 years at the helm of NATO, Jens Stoltenberg is the second longest-serving Secretary-General of the Alliance, since its establishment 75 years ago. His mandate began in the context of the annexation of Crimea by Russia, then went through the withdrawal of allies from Afghanistan, the COVID crisis, and now through the war started by Russia. NATO  expanded to 32 members, after the accession of Montenegro, North Macedonia, Finland and Sweden.

     

    VISA WAIVER – Romania formally meets all technical criteria in order to be included in the Visa Waiver program, the Romanian ambassador to the United States, Andrei Muraru, announced on a social network. The fiscal year in the United States ended on Monday, and the last condition that Romania had to fulfill was satisfied. We are waiting for a confirmation from the American partners in the upcoming period, but our assessment, based on the number of visa applications this year, as well as the strong downward trend in recent years, is that Romania has dropped below the 3% rejection rate, Muraru explained. According to the ambassador, the first Romanians will most likely be able to travel without visas to the United States, in the first part of next year.

     

    LAW – The head of the European Public Prosecutor’s Office, the Romanian Laura Codruţa Kövesi, has called on the European Parliament to change the institution’s regulations, to allocate a bigger budget and for a better collaboration with the member states. She says that the number of cases of cross-border financial fraud has doubled year on year, and the information collected about organized crime exceeds the analytical power of the Prosecutor’s Office and even Europol. Last year, following the investigations of the European Public Prosecutor’s Office, court sentences were given for the recovery of 1.7 billion euros, and 600 million euros have already been returned to the member states, Kövesi explained. At the moment, over 2,000 cases are under investigation, with damages estimated at 23 billion euros. Romania was involved in 260 cases, with a damage of almost 2 billion euros.

     

    INVESTMENT – The net flow of direct foreign investments in Romania in 2023 was almost 6.75 billion euros, down by 36.3% compared to the record value recorded in the previous year, the National Bank of Romania (BNR) has announced. BNR experts say that this development is part of the current international context, marked by economic risks and geopolitical tensions. The main sectors that attracted foreign money in Romania were industry, financial intermediation, insurance and trade.

     

    PARLIAMENT – Convened in joint session, the Romanian deputies and senators are appointing, today, the members of the Board of Directors of the National Bank of Romania. According to political sources, the current governor Mugur Isărescu, who has been holding this position since 1990, is supported for a new mandate at the helm of BNR. Also today, the Parliament submits for approval two requests from President Klaus Iohannis – the participation of the Romanian Army in the NATO Security Assistance and Training Mission for Ukraine and the establishment, on the Romania territory, of a maritime training facility for the Ukrainian personnel. The two Parliament chambers will be informed, on the other hand, about the approval of the transit, through Romania, of equipment and material goods donated by Sweden to Ukraine, but also about the presence on the Romanian territory, for a period of two years, of an American contingent of naval forces for special operations.

     

    ISRAEL – The Israeli military launched a ground operation in a number of villages in southern Lebanon, saying it focused on clearing out militant infrastructure prepared by the elite force of the Hezbollah for the invasion of Israeli territory. The invasion was being supported by the Israeli air force, which targeted the southern suburbs of Beirut, an area considered the stronghold of the Shiite movement. Israeli Defense Minister Yoav Gallant had previously indicated that the army was ready for a ground operation, telling troops near the border with Lebanon that Israel was ready to use air, sea and land forces against Hezbollah targets. In turn, the deputy leader of the Hezbollah said that his militants are prepared for any Israeli operation in Lebanon.

     

     

     

  • August 7, 2024

    August 7, 2024

    INTEREST RATE – The Central Bank board is today analyzing the possibility of further reducing the monetary policy interest rate, currently standing at 6.75%. According to an internal analysis, consumer loans continue to go up amidst the reduction of interest rates for new loans and the relaxation of loaning terms due to growing competitiveness among banks. According to Eurostat, Romania reported the biggest increase of retail sales at EU level in June 2024 compared to the same period of last year.

     

    NATO – A detachment of the Spanish Air Forces will conduct enhanced air policing missions under NATO command, in partnership with the Romanian Air Forces. Spanish pilots are thus taking over command of the operation from their British and Finnish counterparts at the Air Base in Mihail Kogălniceanu (southeast). For four months, they will be overflying the Black Sea region to ensure the security of Romanian and NATO air space. This is the third rotation for the Spanish Air Forces in Romania, where NATO deployed allied troops in 2014 following the illegal annexation of Crimea, to ensure the security of the Black Sea region, an area facing complex threats in the wake of Russia’s invasion of Ukraine.

     

    MIDDLE EAST – The world’s diplomats are working around the clock to prevent an attack from Iran and its allies on Israel. The United States have called on countries in the region to convince Teheran an attack would not serve its best interests. Foreign Ministers of the Organization for Islamic Cooperation (OIC) are today convening in Teheran to discuss the matter. The situation remains tense, with Israeli authorities on high alert after Iran promised a swift retaliation in response to the recent assassination of Hamas leader, Ismail Haniyeh.

     

    AID FOR UKRAINE – The EU Council has disbursed the first installment worth 4.2 bln EUR as part of the Ukraine Facility financial assistance plan. Kyiv is bound to receive 50 bln EUR in grants and loans to finance the state budget and stimulate investment. According to Radio Romania’s Brussels correspondent, Ukraine must implement reforms in public finance management, the functioning of state-owned enterprises, the business sector and energy, as part of the Ukraine Facility Plan agreed with the European Commission. Economic recovery, reconstruction and modernization in the wake of the Russian aggression are also key points in the Plan.

     

    UNTOLD – The 9th edition of the Untold Music Festival kicks off on Thursday in Cluj-Napoca (west). Some 250 Romanian and international artists will be holding concerts during the four days, including renowned artists and DJs such as Lenny Kravitz, Salvatore Ganacci, Sam Smith and Burna Boy. The latter is the only African artist with two consecutive sold-out events on London Stadium. Burna Boy will perform on the last day of the festival. Untold is the biggest and most popular music festival in Romania, attracting fans from all over the world every year.

     

    OLYMPICS – Romanian athletes are today competing in athletics, weightlifting, canoeing and wrestling at the Paris Olympics. So far, Romania ranks 16th in the medal standings, with 3 gold, 3 silver and 1 bronze. On Tuesday, the Romanian Gymnastics Federation announced it has submitted a notification to the International Gymnastics Federation, calling for an investigation into the faulty examination of Sabrina Voinea’s floor routine in the Olympic gymnastics event. Federation officials have also submitted notifications to the Court of Arbitration for Sport (TAS) to restore Sabrina Voinea’s bronze medal, who went to Jordan Chiles of the USA following an inquiry at the end of her routine. Voinea’s routine was rated with a penalty deduction due to the gymnast allegedly stepping out of bounds, something video footage fail to confirm, the Romanian Olympic and Sports Committee wrote. In turn, Prime Minister Marcel Ciolacu expressed outrage at the whole affair, announcing he would not attend the closing ceremony as a sign of protest.

     

    FOOTBALL – FCSB and Sparta Prague were tied 1-1 on Tuesday evening in the first leg of the Champions League third preliminary round, played in Prague. The return leg is slated for August 13 in Bucharest. In case of a win, FCSB will play the winner of the match pitting Malmö FF of Sweden against PAOK Thessaloniki of Greece. In case of a loss, FCSB will continue in Europa League, playing against LASK Linz of Austria. (VP)

  • Updated inflation forecast

    Updated inflation forecast

    The National Bank of Romania has increased its estimate on the inflation rate in Romania for the end of 2024, from 4.7% to 4.9%. At the same time, the Bank maintained the inflation forecast for the end of next year at 3.5%. Central Bank Governor Mugur Isărescu on Wednesday presented an updated inflation report, explaining why the level of the inflation rate will exceed the original estimates at the end of the year. Inflation will continue its downward trajectory, although at a slower pace than expected, Isărescu said. The Central Bank is trying to lower inflation, without however triggering a recession, he added. The Governor of the Central Bank claims that returning the inflation rate to the reference target range will depend a lot on the timing the Bank decides to reduce the reference interest rate, but also on its level. At the start of the week, the Central Bank Board of Directors decided to maintain the monetary policy interest rate, also known as the “reference interest rate”, at the level of 7% per year.

     

     

    The Governor of the National Bank also said that a favorable evolution of the inflation rate this month could prompt the Board of Directors to decide to reduce the reference interest rate, which influences all interest rates charged by commercial banks. Such a decision, however, depends on the entire evolution of the local economy, as well as on international developments. However, Mugur Isărescu does not exclude the possibility that the decision will be postponed to the second half of the year or even be ruled out entirely for 2024. On the other hand, the Central Bank Governor said that revenues increase much more than productivity overall, which will have a significant impact on inflation, adding that he expects to see productivity increase as well. Mugur Isărescu referred to the latest statistical data, which confirms that the average net salary exceeded the equivalent of 1,000 EUR in March. The main uncertainties and risks regarding the evolution of the inflation rate continue to be related to fiscal and budget policies, being linked to the high budget deficit, the salary dynamics and the additional fiscal-budgetary measures that could be implemented in order to continue the budget consolidation. Other elements, such as the potential effects of the wars in Ukraine and the Middle East, also impact the evolution of the inflation rate.

     

     

    The annual inflation rate continued to decrease and reached 5.9% in April compared to 6.61% in March, the National Institute of Statistics announced this week. Prices for foodstuffs and services reported slight increases, below 1%. In contrast, prices for non-food products went down. According to the European Commission’s spring forecast, Romania’s economic growth remains one of the most robust in the EU, 3.3% per year. On the downside, Romania has the highest inflation rate at community level, almost 6%, nearly twice the European average. (VP)

  • THE WEEK IN REVIEW

    THE WEEK IN REVIEW

    The Prime Minister of Romania visits Italy

    Romania and Italy are entering a new stage of development of their consolidated strategic partnership, Prime Minister Marcel Ciolacu said on Thursday in Rome. He pointed out that the joint statement he signed with Prime Minister Giorgia Meloni lays the foundations for an action plan that will strengthen relations between the two states at another level. “I appreciated the openness of Ms. President Meloni regarding the intensification of economic cooperation, but also for the valorization of the Romanian diaspora living in Italy, as well as the Italian community in our country,” said Ciolacu, in joint statements made alongside his Italian counterpart. Marcel Ciolacu conveyed to the Romanians in Italy that the authorities in Bucharest are at their disposal, and thanked the Italian Prime Minister and the Ministry of Labor and Social Policies of this country for unblocking the situation regarding the settlement of the pension files of the Romanians who worked in the Peninsula. At the same time, the head of the Government expressed his hope that Prime Minister Meloni will also support the steps to complete the negotiations on the agreement between the Romanian Orthodox Bishopric and the Italian Cabinet, started in 2012, regarding the status of Romanian Orthodox clergy, in the context in which the Orthodox Bishopric provides essential support for Romanians in Italy. During the joint meeting of the two Governments, the main topic was related to the economic dimension, given the fact that bilateral trade exceeded 20 billion euros in 2023, a new record. “Italy is Romania’s second trade partner. At the same time, I notice, with satisfaction, that the Romanians over here have reached the second place in a ranking of foreigners who open businesses in Italy, with tens of thousands of companies and individual enterprises”, highlighted Ciolacu. He also launched a call to Italian companies to invest in Romania. On the other hand, the meeting of the Cabinets from Bucharest and Rome also provided the opportunity to discuss topics on the European and international agenda. Also on Thursday, Prime Minister Ciolacu was received at the Vatican, in a private audience, by Pope Francis, and then he discussed with the Secretary of State of the Holy See, Cardinal Pietro Parolin. The visit of the Romanian delegation to Italy ended with an Italian-Romanian economic forum. On Wednesday, on the first day of his visit to Italy, the head of the Bucharest executive had a meeting with the mayor of Rome and representatives of the Romanian community in the Peninsula.

    Economic forecasts

    The National Bank of Romania has slightly lowered its inflation forecast at the end of this year to 4.7%, and anticipates a value of 3.5% for the end of 2025. The Governor of the National Bank of Romania, Mugur Isărescu, says that there are, however, a number of internal and external factors that can leave their mark on the evolution of inflation, among the most important being the conduct of fiscal policy, as well as the developments related to the two unfolding military conflicts. On the other hand, the Central Bank does not rule out a decrease in the monetary policy interest rate, after recently deciding that this indicator should remain at 7% per year. According to the governor of the NBR, Mugur Isărescu, the reduction of the reference interest rate, taken into account by any bank when granting loans to clients, individuals or companies, can only take place after two consecutive months of falling inflation. For its part, the National Institute of Statistics shows that Romania’s economy grew by 2% in 2023. The increase is above the level recorded both in the EU and in the euro zone, where the gross domestic product grew by only 0.5 percent.

    Cyber attack on hospitals in Romania

    26 hospitals in Romania, including Bucharest, were affected, this week, by a cyber attack that encrypted the data from the servers of these units, announced the National Cyber Security Directorate. Most of the affected medical units, however, had backups. The Minister of Health, Alexandru Rafila, stated for Radio Romania that some of the affected units managed to fix their problems, and the competent institutions will develop a new technical standard aimed at preventing such actions that destabilize the medical system. The national organized crime division has opened a criminal case, in which criminal investigations are carried out in rem, in connection with the cyber attack. In the past, computer attacks have also targeted public institutions in Romania.

    Gold and bronze medals for Romanian athletes

    Mihaela Valentina Cambei was awarded the title of the best European weightlifter of the year 2023, on Monday, in Sofia, Bulgaria, after winning three gold medals in the 49 kg category, at the European Championships, announced the Romanian Weightlifting Federation on its Facebook page. On the other hand, on Thursday, Romanian athlete Andreea Beatrice Ana won the gold medal in the 55 kg category, at the European Wrestling Championships for seniors in Bucharest, after defeating Mariana Drăguţan from the Republic of Moldova in the finals . Also on Thursday, Romanian athlete Cătălin Preda won the bronze medal in the men’s high jump event (27 meters), at the World Swimming Championships in Doha, Qatar. Romanian Constantin Popovici, the holder of the world title, ranked only eighth. At the World Championships in Fukuoka, last year, Popovici won the gold, and Preda took the silver. Popovici also won gold at the 2022 European Championships, where Preda also took the silver.

  • The Central Bank and the Romanian Treasure in Moscow

    The Central Bank and the Romanian Treasure in Moscow








    The National Bank of
    Romania (BNR) will launch several events meant to reaffirm that Romania has a
    fully valid right of claim from a historical and legal point of view over the
    Romanian treasure sent for safe-keeping to Moscow. The project starts from the
    observation that abroad, even among the European decision-makers, the issue of
    the Romanian treasure is largely
    unknown, therefore, a first step will be to inform the members of the European
    Parliament and bring this topic to the attention of the international community.
    The Central Bank has consistently implemented, since 1991, a strategy regarding
    the presentation to the domestic and foreign public opinion of the issue of the
    treasure sent to Moscow during the First World War and then seized by the
    Soviet Union, stated the governor of the BNR, Mugur Isărescu, at a seminar on
    this topic organized, recently, at the headquarters of the Central Bank. He
    added that, this year, when it is 107 years since the evacuation of Romania’s
    treasure to Moscow, the BNR proposes to relaunch the process of
    internationalization of issues related to this theme.


    Mugur Isarescu: The treasure of the National Bank of
    Romania, the gold treasure sent to Moscow for safe-keeping, therefore deposited
    in an allied country, accompanied by the necessary documents and under an
    international agreement recognized and validated by history, remains the only
    case in which the gold treasure of a country is entrusted with proper documents
    and the depository’s guarantees that it will be returned at
    any time, at the request of the owner, in which
    subsequently these assumed obligations, according to all international
    norms and customs, are not observed.




    The Central Bank Governor has
    stressed that the National Bank of Romania has continuously taken actions towards
    the recovery of the treasure, which culminated in the recognition, within the
    joint Romanian-Russian commission dedicated to discussing this topic, of the
    fact that the documents presented by the Romanian side represent authentic
    documents, with the value of an international treaty, which certifies the
    deposit by Romania in Russia, in Moscow, of the assets of its treasury,
    including that of the BNR. The Central Bank has a file, since 1922, containing
    all the original documents related to the evacuation of the Romanian treasury,
    a file handed over time from one governor to another, including during the
    communist period. During the First World War, due to the difficult situation at
    the front, the BNR took measures to keep its treasure safe.




    According to official
    documents, in total, in December 1916 and July 1917, the BNR deposited in
    Moscow 91.48 tons of fine gold, as well as Queen Marie’s jewels. In October
    1917, the Bolsheviks led by V. I. Lenin seized power and, in January 1918, the
    Council of People’s Commissars announced the severance of diplomatic relations
    with Romania, the arrest of the Romanian minister in Petrograd and the confiscation
    of Romania’s treasure deposited in Moscow. The current reserve of the Central
    Bank is only slightly larger than the Romanian gold in Moscow, namely 103.6
    tons, at an estimated value of 5.6 billion euros. (MI)

  • A higher monetary policy rate in Romania

    A higher monetary policy rate in Romania

    The National Bank of Romania made several important decisions on Tuesday. The first concerns the increase in the monetary policy interest rate to 6.75% per year, from 6.25%. The Central Bank also increased the interest rate for the lending facility, as well as the deposit facility interest rate. The Central Bank decided to maintain a firm control over the liquidity on the monetary market and to maintain the current levels of the mandatory minimum reserve rates for liabilities in lei and in foreign currency of lending institutions. At the beginning of this year, the key interest rate was standing at the level of 2% per year.



    The increase is explained by the fact that the increasingly expensive electricity and food raised inflation, in September, to almost 16%, above the forecast level, says the National Bank. Inflation is expected to increase towards the end of this year again, to then take a gradual downward trajectory. It will drop below 10% only in the first semester of 2024, Central Bank experts predict.



    The Central Bank increased the monetary policy interest rate by 0.5 percentage points, taking into account the increase in inflation and the regional context, according to economic analyst Constantin Rudniţchi:


    I think that the situation in Central and Eastern Europe was also taken into account. Many central banks in neighboring states have already increased the interest rate more than Romania and, of course, if you have a higher interest rate, that national currency is more attractive. And here I am thinking about Poland, Hungary and, of course, the global context is not to be neglected at all, because it is clear that you cannot stay out of this game if, as it happens, interest rates are rising all over the world, from the United States to the Eurozone and then the National Bank also joins this trend and obviously it’s normal to do that.



    On the other hand, there is also good news, in Rudniţchi’s opinion, namely that the new increase in the key interest rate will not produce major effects in terms of interest rates in the interbank market, which are already above the level announced by the Central Bank. Constantin Rudniţchi believes that the current increasing interest rate trend does not benefit at all people or companies who have credits or who want to take out a loan.




    The evolution of inflation is marked by high uncertainties associated with schemes for capping and compensating energy and fuel prices, the escalation of the war in Ukraine and the associated increasingly severe sanctions. The inflation equation also includes, according to the NBR, the level of absorption of European funds, especially from the NRRP, and the fiscal policy, against the background of the excessive deficit procedure and the general tendency to increase the cost of financing. In its estimates, the Central Bank reconfirms the significantly higher than expected increase in economic activity in Romania in the second quarter of this year, but indicates a quasi-stagnation in the last two quarters of 2022. (MI)



  • Record-high inflation in Romania 12/05/2022

    Record-high inflation in Romania 12/05/2022


    After countries all over the world reported record-high inflation rates last week, Romania too is confronted with the highest annual inflation rate in the last 18 years – nearly 14%, way above the Central Banks estimates. Natural gas reported the highest increase in April, by over 85%, potatoes and cooking oil by nearly 40%, and fuel by over 35%. 20% price hikes were also reported for heat, electricity, air transport, postal services, water, sewerage and sanitation utilities. Prices for fresh and canned vegetables also went up, as well as for grains and flour products, including bread, thus reducing Romanians purchase power considerably. According to the National Statistics Institute, most general consumption products did not report any decrease. Only the prices for rail transport and telephone services leveled out.




    The Central Bank estimates the inflation will continue to exceed the original forecast and is expected stay above 10% in the first half of next year as well and go below this mark only in the second half of 2023. To help the economy, the Bank has increased the monetary policy interest rate, which is a reference for setting loan rates. According to the National Bank, the energy price hikes cannot be kept in check by the reference rate, although it can influence the general evolution of prices. Against the backdrop of price hikes across the board, the business sector believes inflation is the main threat right now. The factors that impact the current evolution are expected to continue, experts say, estimating the inflation will continue to rise until summer. Specialists also argue the more tangible effects of price hikes on Romanian consumers will appear in the second half of the year, because consumption prices will continue to go up, also under the influence of the negative fallout of the war in Ukraine and the related sanctions.



    In this context, the government is looking for solutions to ease the pressure on the population, and has already adopted two measures as part of a support package. The first is a 50-Euro social voucher that will be provided every two months to individuals with low income, while the second measure will adjust material prices for ongoing construction projects using European funds. Besides, the government is also discussing an emergency decree that will allow the Competition Council and the Consumer Protection Agency to intervene more quickly when operators increase prices without due justification, which the authorities have noticed on numerous occasions of late. (VP)




  • September 22, 2020

    September 22, 2020

    Covid-19 RO. The Covid-19 epidemic is currently growing stronger in Romania. For the first time, more than 9,000 new cases were reported in one week. The rate of positive results against the total number of tests performed increased and the transmissibility index is higher than 1. The most recent report indicates 1059 new cases of infection in the past 24 hours. The total number of deaths, from the end of February until now, has reached 4,503. There are currently 496 patients in intensive care, out of a total of over 7,200 in hospitals. However, authorities say that if measures are taken to prevent the virus from spreading, the number might drop from mid next month. On the other hand, one week after the start of the school year, cases of students and teachers diagnosed with Covid-19 have already been reported. Data published by the Ministry of Education show, though, that the number of schools that offer courses exclusively online has decreased and that of the units in which the courses are held in a hybrid system has increased. We remind you that schools in Romania operate on the basis of three scenarios: green, which involves the physical presence in school, yellow, which combines classical and online education, and red – distance learning.



    Pandemic. The number of cases of Covid-19, globally, is close to 31.5 million, and the number of deaths stands at 970 thousand. More than 23.1 million people have been cured, according to the latest data published on the worldometers.info platform. The British Prime Minister Boris Johnson is addressing the nation today to announce new measures to counteract the coronavirus after the alert level for COVID-19 has risen from 3 to 4, which means that the transmission is growing exponentially. In Spain, which reports about 3,000 new cases a day, travel restrictions apply in several localities and much of the capital this week to limit the spread of the coronavirus. Italy has decided to introduce tests to detect the infection with coronavirus for all citizens coming from the red zones of France. US President Donald Trump has said that the coronavirus pandemic, which has claimed nearly 200,000 lives in the United States, does not affect young people, but only the elderly who suffer from heart disease or other ailments, which has been contradicted by data provided by health experts. On the other hand, the World Health Organization has announced that it wants to have 2 billion doses of vaccine available by the end of next year. The goal is for most people in all countries to be vaccinated, not all people in just a few countries, says WHO chief Tedros Ghebreyesus. More than 60 rich countries, including neither China nor the United States, have joined a WHO-implemented device to facilitate poor countries access to a vaccine against the new coronavirus.



    Budget. The Romanian Parliament gathers today to debate and vote on the budget adjustment bill, a draft that differs substantially from the one submitted by the government, after, in committees, the main opposition party, the Social Democratic Party, introduced amendments with a considerable budgetary impact and which the Liberal executive said could not be sustained by the economy. The amendments adopted by the joint budget committees aim to increase the pension point by 40% from 1 September, and not by 12%, as proposed by the government. The Social Democrats also voted to increase teachers salaries this year and allocate additional money to local authorities. The Social Democrats believe that the sums for raising pensions can be found in measures that the government can take in the future, including by creating new jobs or recovering arrears. Instead, Prime Minister Ludovic Orban explained that the changes adopted in the committees run counter to Romanias interests. These involve a total expenditure surplus of 6.3% of the GDP, the prime minister said, adding that all available constitutional and legal instruments will be used, including a new adjustment, to prevent them from entering into force. Moreover, he has stated that the budget “can no longer afford to increase spending at the moment” and called on all political forces not to support in Parliament the report of the specialized committees on budget adjustment.



    Central Bank. The National Bank of Romania has issued a warning about the risks of a 40% increase in pensions. According to the Convergence Analysis Report, published on the NBR website, this measure would increase the budget deficit next year to over 11% of the GDP. A high systemic risk is possible by worsening the state of the public budget, followed by a reaction of the financial markets that could seriously affect the economy, making it difficult to return in 2021, Central Bank specialists say. “Instead of an orderly correction over several years, we would be forced to a disorderly correction, which will be very costly economically and socially” , the report also reads.



    Open Skies. A joint mission of Romania, France and Germany is conducting an observation flight in Russia until Friday, part of the “Open Skies” agreement with Moscow. The flight is performed on board a Romanian specialized aircraft Antonov 30, unarmed and equipped with aerial photography equipment. The plane and equipment were certified internationally, including with the participation of Russian specialists, which excludes their use for purposes other than those provided. During the flight, whose route is agreed with the Russian side, Russian specialists will be on board the plane, who will control the observance of the mission parameters and the use of the equipment. The Open Skies Agreement was signed in 1992, after the end of the Cold War, by 23 OSCE member states, as a measure to increase confidence in arms control and compliance with disarmament agreements. In recent years, Russia and the United States have accused each other of violating the agreement, so that in May this year the United States announced its withdrawal from the agreement within six months. The decision has been criticized by a majority of European NATO members, while Russia has said it will remain part of the agreement.



    Tennis. Romanian Simona Halep consolidated her second position in the world ranking of professional tennis players (WTA), announced on Monday, after winning the title at the Premier 5 tournament in Rome. It is the third tournament won by Simona Halep this year, after those in Dubai and Prague. Halep is now less than 1,500 points behind leader Ashleigh Barty, who will not be taking part in the Roland Garros tournament, so the Romanian could return to the first position. Four other Romanians are in the top 100, Patricia Ţig, who remains on 58th , Irina Begu, who climbed five places and is 72nd, Sorana Cîrstea, who went down one step to 83rd, and Ana Bogdan, on 93rd position. (M. Ignatescu)


  • February 11, 2020 UPDATE

    February 11, 2020 UPDATE

    EARLY ELECTIONS – The investiture vote for the new Cabinet will be held in Parliament on February 24. Ministers will appear before the specialist committees starting next week. Prime Minister designate Ludovic Orban said he wants to trigger early elections, by enabling citizens to elect a new Parliament, which should be fairer, more honest and more representative. Ludovic Orban is holding talks with parliamentary party officials, in an attempt to garner support for the organization of early elections. Snap elections may only be called if 2 Cabinet nominations are rejected by Parliament within 2 months. Orban, whose Liberal Cabinet was recently dismissed under a no-confidence motion, Monday sent to Parliament a list of ministers, with no changes whatsoever from the previous team, and a slightly updated government programme. The main party in Parliament, the Social Democrats, announced they will not take part in the talks with the Liberals. The Social Democratic Party filed a challenge with the Constitutional Court, arguing that the President designating a prime minister who has already been dismissed comes against the will of Parliament. The idea of early elections is mainly supported by the National Liberal Party and Save Romania Union. Regular general elections are scheduled for this autumn.

    JUDICIARY – The incumbent Justice Minister Cătălin Predoiu on Tuesday presented European Commission experts with a bill on dismantling the special division investigating magistrate offences as well as the progress of debates on this topic. In its latest Cooperation and Verification Mechanism report the Commission criticized the establishment and the activity of this division, which it said was an instrument of political pressure. The latest report under the Mechanism was released in October 2019, and suggested the extension of verification on the Romanian judiciary, on grounds that in 2019 Romania backslid in terms of the fight against corruption and the independence of the justice system. A team of European Commission experts met in Bucharest with members of Parliament’s judicial committees. According to the chairman of the judicial committee in the Chamber of Deputies, talks focused on identifying the best solutions regarding the criminal and criminal procedure codes and appointing chief prosecutors.

    INFLATION – The central bank has lowered Romania’s 2020 inflation forecast from 3.1% to 3%, Governor Mugur Isărescu announced on Tuesday. For next year the National Bank expects a 3.2% inflation rate. A number of elements have been taken into account, which might lead to a decrease of the inflation rate from the forecast value. These elements include developments in the Eurozone economy, including geopolitical tensions and weaknesses in emerging markets, a possible escalation of trade conflicts, the completion of Brexit, as well as the accommodating monetary policies of the European Central Bank and the Fed. On the other hand, liberalization of the electricity and natural gas markets may push inflation higher than expected, as do the problems in the labor market, such as the shortage of labor and the mismatch between demand and supply in this respect.

    COVID-19 – China announced that the novel coronavirus has already killed more than 1,000 people, and the number of cases exceeds 42,000. In the last 24 hours alone, over 100 deaths have been reported, which is the largest number of victims in just one day since the epidemic broke out. Most deaths were reported in the Hubei province. A team of physicians with the World Health Organization has arrived in China to help in the research. Meanwhile, the WHO organizes a 2-day meeting in Geneva, with renowned physicians, public healthcare experts and scientists, in an attempt to encourage a better response of the international community to the new coronavirus outbreak. On opening the meeting, the WHO director general Tedros Adhanom Ghebreyesus said the coronavirus epidemic was a major threat, and called on scientists to work together to develop vaccines or medication to fight the virus. The official code name for the virus is Covid-19. In Romania, several people, including Chinese nationals, are under house monitoring, and the authorities continue to take measures to prepare for possible infection cases. A special unit was set up in Bucharest for the Romanians who return from China and have to be quarantined for 14 days.

    TENNIS – Romania’s Fed Cup team will take on Italy in a playoff match that will decide which team remains in the World Group, according to Tuesday’s draw held in London. The match will be played in Romania over April 17-18. Romania last weekend lost 3-2 to Russia at home, counting towards the final tournament. Simona Halep, world no. 2, did not represent Romania. Italy currently leads 2-1 in matches against Romania.

    (translated by V. Palcu)

  • January 29, 2019 UPDATE

    January 29, 2019 UPDATE

    DIPLOMACY – President Klaus Iohannis has said, at a meeting with the heads of diplomatic missions in Bucharest, that he will do everything in his power to ensure that the values of the rule of law, of liberal democracy and of an independent and efficient judiciary are not affected. The president vowed that, regardless of the very dynamic domestic political situation, all decision makers will join efforts to ensure the proper fulfilment of Romania’s role as holder of the presidency of the EU Council in the first half of 2019. He reiterated that Schengen accession remains a priority for Romania. Also, according to the head of state, Bucharest’s candidacy for a non-permanent seat in the UN Security Council is quite strong. As for strengthening the strategic partnership with the US, Klaus Iohannis said this remains a foreign policy priority for Romania.



    EUROPEAN AFFAIRS — The Romanian Foreign Minister, Teodor Meleşcanu, said in an interview with the France Press News Agency made public on Tuesday that there shouldn’t be any relation between European funds and the rule of law. Whereas Brussels and Washington have criticized the legislative overhaul in the Romanian justice system over the past two years, which- in their opinion — poses a threat on democratic institutions, Teodor Meleşcanu has referred to a reform carried out transparently. The Romanian Foreign Minister also gave assurances that Romania is a stable and solid democracy. On January 16, the European Parliament debated and voted on rules to reduce pre-financing or suspend EU budget payments to member states which interfere with courts or which do not tackle fraud and corruption. This proposal, launched by the European Commission will be a point on the agenda of negotiations with the Council of the European Union. Romania is currently holding the rotating presidency of this Council.



    BREXIT — Romanian PM Viorica Dăncilă and the British ambassador to Bucharest, Andrew Noble, held talks in Bucharest on Tuesday on Great Britain’s leaving the EU, against the backdrop of Romania’s holding the Presidency of the Council of the European Union. Viorica Dăncilă and Andrew Noble underlined the very good stage of bilateral relations, the common role in securing and defending Europe, as well as the tighter economic and social ties between the two countries. The Romanian Prime Minister reiterated that Romania pays special heed to the need to protect the rights of the Romanian citizens living in the UK, and, in her turn, she gave assurances that Bucharest will make everything necessary at domestic level for the protection of the rights of British citizens in Romania.



    CORRUPTION -Transparency International Tuesday presented its annual Corruption Perceptions Index, which ranks 180 countries by their public sector corruption levels as decided by consulting experts and business communities. According to the 2018 report, Romania ranks 61st in the world, with 47 points, down 2 places since 2017. Transparency International’s index uses a 0 to 100 scale, with 0 standing for extremely high corruption and 100 for no corruption at all. Out of the 28 EU member states, Romania is 24th. The top positions in the global ranking are held by Denmark, New Zealand, Finland, Singapore, Sweden and Switzerland.



    FINANCIAL — The Governor of the National Bank of Romania, Mugur Isărescu, on Tuesday declined the invitation for hearings in the Economic Committee of the Romanian Senate on the way in which the “Romanian Interbank Offer Rate” ROBOR is set and on the severe depreciation of the Romanian national currency, the leu, in recent times. The invitation to answer some questions in Parliament has been extended to Mugur Isărescu against the backdrop of accusations levelled very more and more often by the ruling parties as well as by some experts and journalists, according to whom the ROBOR index is allegedly set following an illegal understanding between the commercial banks, which the National Bank knows of, without intervening on the market. The central bank is also accused of doing nothing to defend the national currency. The Spokesperson for the National Bank of Romania, Dan Suciu, has said it is important that talks in the Economic Committee of the Senate do not to start from ungrounded, fake news.



    EURO 2020 — The City Hall of Bucharest on Tuesday marked the countdown to EURO 2020 which kicks off in 500 days time, by mounting an exhibition with the T-shirts worn by prominent Romanian footballers such as Gheorghe Popescu, Gheorghe Hagi, Ioan Andone, Dudu Georgescu, Helmuth Dukadam, Miodrag Belodedici and Bogdan Stelea. Romania has been chosen to organise four matches on the National Arena in Bucharest. The capital city will host three Group C matches and a match in the eighth finals. Consequently, the National Arena will venue these matches on June 14, 18, 22 and 29, 2020. (Translated by AM Popescu and D. Vijeu)

  • National Bank report on economy

    National Bank report on economy

    The National Bank of Romania will
    meet its 2 goals for this year, namely price stability and financial stability,
    the central bank governor Mugur Isarescu said on Monday, when he presented a
    Report on Financial Stability. He explained that the consumer price index would
    get within the 2.5% range forecast by the National Bank.


    On the other hand, Mugur Isarescu
    said that the switch to the euro is a major goal, which may act as a catalyst
    of positive changes in the country. The National Bank official added that the
    GDP gap between Romania and other EU member countries has narrowed
    considerably. Thus, the purchasing power parity GDP per capita has increased
    from 40% of the EU average in 2007 to over 60%. But, according to Mugur
    Isarescu, although Romania has made some progress, it still has a long way to
    go to a smooth integration in the circuit of European values:


    Nearly 12 years since Romania
    joined the European Union, the progress made by the Romanian society is utterly
    remarkable. It is the fastest real convergence pace among the newer EU member
    states. This is a remarkable performance, but it must carry on at the same high
    pace, which requires more precision and also superior quality in public
    administration in general. We need a lot of things, substantial investments in
    infrastructure, and adoption of the high standards of administrative practice
    that are at work in the other EU countries.


    In turn, the deputy governor of the
    central bank, Liviu Voinea, said the main positive occurrence is the lower risk
    of economy overheating. He added that the inflation rate is returning to the
    target range, and estimated that it will reach 3.5% by year end and 2.9% in
    2019. At the same time, government debt has dropped by 1% compared to the end
    of 2017, to 34.1% of the GDP at the end of June this year, against the backdrop
    of solid economic growth, and remains under the critical threshold for the
    European Commission’s monitoring procedure, which is 60% of GDP.


    According to the same report, the
    unemployment rate stays on a downward course, reaching 4.2% in the 3rd
    quarter of this year, while the employment rate has followed the same positive
    trend of the previous period, going up to 70% in the second quarter of 2018.
    The banking sector remains healthy. The report also mentions some weaknesses of
    the Romanian economy, including the demographic decline.