News

Daily Newsletter - 24 November 2017

Summary

Macroeconomic News (4)

The absorption rate of European funds for agriculture and rural development reached 33%. Payments worth over 2.3bn euros were made through PNDR 2014-2020 (Source: zf.ro; Date: 2017-11-23; Author: Unspecified)

The absorption rate of European funds in the National Rural Development Program 2014-2020 reached 33% at present, the Ministry of Agriculture and Rural Development paying 2.3bn euros, out of an overall allotted ceiling worth more than 8.1bn euros, according to Cornel Stefan, the director of the National Rural Development Network and Rural Infrastructure Directorate from the Ministry of Agriculture.

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Romania's economic gap with the EU countries is lower, but the ratio between the gross national income and GDP deteriorated - NBR (Source: economica.net; Date: 2017-11-23; Author: Unspecified)

Romania's economic gap with the EU countries is lower, but the ratio between the gross national income and GDP deteriorated, in the past 17 years, it emerges from a presentation of the vice governor of the National Bank of Romania (NBR), Florin Georgescu. "In the past 17 years, in Romania, GDP per capita convergence cumulated 33% (from 26% of the EU average in 2000 to 59% of the EU average in 2016), being the second highest in the former communist states after Lithuania (+38%). The ratio between the gross national income, which is the added value achieved by Romanians in the country and abroad, and GDP, which expresses the gross added value obtained in the country by Romanians and foreigners, dropped by 1.8%, from 99.3% in 2000 to 97.5% in 2015", the document shows.

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This is a Romanian paradox! Record economic growth from drops on the basic sectors (Source: cursdeguvernare.ro; Date: 2017-11-23; Author: Unspecified)

According to a Eurostat communication of 17 November 2017, Romania ranks first in the states recording the highest falls in production volume in September this year compared to one year before in constructions sector (-4.6% in Romania, compared to -3.8% in Hungary and -2.4% in Slovakia, with a +0.1% reference in EU28 average, seasonally adjusted values). Compared to the same month of last year, the situation is even worse, with the record decrease of -13.5% for Romania, at a great distance from the UK (-1.4%) and Belgium (-0.4%).

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NBR analysis: Romania's economic gap with the EU countries decreased in the past 17 years (Source: bursa.ro; Date: 2017-11-23; Author: Unspecified)

Convergence in Romania, expressed in GDP per capita terms cumulated 33% in the past 17 years (from 26% of the EU average in 2000 to 59% of the EU average in 2016), being the second highest in the former communist states after Lithuania, an analysis of the prime vice governor of the National Bank of Romania (NBR), Florin Georgescu, shows. On the other hand, the ratio between the gross national income, which is the added value achieved by Romanians in the country and abroad, and GDP, which expresses the gross added value obtained in the country by Romanians and foreigners, dropped by 1.8%, from 99.3% in 2000 to 97.5% in 2016.

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Financial News (4)

Romania needs a road map for at least five years for joining the euro. It will not happen sooner than 2023 (Source: economica.net; Date: 2017-11-23; Author: Unspecified)

The latest discussions held in the banking environment shows that in order to join the euro, Romania would need minimum five years, as of 2018. Moreover, a realistic road map to establish all the stages that must be fulfilled until joining the euro and a "powerful political grip" are needed. The road map may be made by a specialist group in various fields, assembled or not in the Committee for preparing the shift to euro.

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LUCIAN ISAR: "Euro can be RON 4 tomorrow, if NBR wants" (Source: bursa.ro; Date: 2017-11-23; Author: Unspecified)

EUR/RON exchange rate is manipulated and/or administered by the National Bank of Romania, the former banker, Lucian Isar, stated yesterday. He explained: "The reserve is large enough for the exchange rate to reach, anytime, even tomorrow, RON 4/euro, and not RON 4.65/euro, if NBR decides so. There is a small oscillation around an upward trend announced publicly by Isarescu, in the personal negotiation campaign with politicians".

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NBR contends it makes non-bank lending, which came off cheap with the capital requirements, more responsible through regulation: In the UK, the interest is limited at 0.8% (Source: profit.ro; Date: 2017-11-23; Author: Unspecified)

The National Bank of Romania entered the non-banking financial institutions (NBFIs) market and increased the capital requirements for those which grant loans with high effective interests and obliges them to a reporting regime similar to that of banks. The central bank contends the move will make the credit firms more responsible, provided that there is an acute problem among low-income people, who appeal to such loans, which led to the emergence of some laws such as the giving in payment and the freeze of the exchange rate for loans in Swiss francs, which targeted banks more. While some NBFI representatives agree with NBR requirements, others challenge them and say they will take more Romanians to pawnbrokers.

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Banca Transilvania becomes the second cheapest issuer in the first stock league in PER after the results in nine months (Source: zf.ro; Date: 2017-11-23; Author: Unspecified)

Banca Transilvania has a 6.96 level of PER (price earning ratio) index calculated for the current prices, the second lowest after Transgaz (6.89). Banca Transilvania (TLV) became the second cheapest issuer in the 13 composing the stock reference BET in PER value, the most used index to characterize the efficiency of equity funds, after it published its results for nine months.

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Investment News (1)

The American giant Intel opens a research and software development center in Timisoara (Source: profit.ro; Date: 2017-11-23; Author: Unspecified)

The American giant Intel will open a research and software development center in a building of Openville complex, Timisoara, next month. About 130 people will work in Intel center, the company intending to supplement the staff scheme to 200 employees over the next 3 years. Intel came to Timisoara in the autumn of last year, by taking over the American startup Movidius, manufacturing media content processors, which had an office in this city too.

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Legislative News (1)

Tudose: We will approve an emergency ordinance for wages in the IT field not to drop (Source: news.ro; Date: 2017-11-23; Author: Unspecified)

Prime minister Mihai Tudose announced Thursday, within the debates in the Parliament on the motion of no confidence, that the Government is to approve an emergency ordinance so that the wages of IT employees would not decrease. "The sole real problem, still in process of settlement, next week, is that with IT employees, who are exempted from tax. We will draft an ordinance for this category to balance the things, so that no IT employee will have his salary lower", Mihai Tudose stated.

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Politics (2)

USR asks for the demission of the justice minister, Tudorel Toader: He was Dragnea's lawyer at CCR (Source: news.ro; Date: 2017-11-23; Author: Unspecified)

USR announced Thursday that it welcomes the decision of the Constitutional Court (CCR) in Belina file and asks for the demission of the justice minister Tudorel Toader, accusing him of having been Liviu Dragnea's lawyer before the constitutional judges. "In the debate of the notification initiated by Calin Poescu Tariceanu, minister Tudorel Toader challenged DNA's competence of appreciating the legality of a government decision. Practically, Tudorel Toader turned into Calin Popescu Tariceanu's lawyer, and indirectly the lawyer of Liviu Dragnea and Tel Drum at the Constitutional Court. Previously, the justice minister made some public statements contending that prosecutors should not investigate the Government Decision allowing the illegal transfer of Belina lake and Pavel arm of Danube to the County Council Teleorman and later to Tel Drum firm", a press release sent by USR shows.

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The motion of no confidence failed, the same as the belief of a part of PSD that there is "a parallel state" (Source: cursdeguvernare.ro; Date: 2017-11-23; Author: Unspecified)

The motion of no confidence "PSDragnea, in campaign mother, in the Government plague", initiated by PNL, was rejected Thursday, 159 votes for being recorded, much below the minimum of 233 favorable votes necessary for the adoption. 317 parliamentarians were present at the debate of the motion and 185 of them voted. 159 votes for, 3 against and 23 abstentions were recorded.

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Social (1)

Save the Children: The draft law amending the legislation on associations and foundations takes children's rights outside the national priorities (Source: adevarul.ro; Date: 2017-11-23; Author: Unspecified)

Save the Children organization expresses its deep concern regarding the content of the draft law amending the rules followed by associations and foundations. The legislative initiative of social democrats Liviu Plesoianu and Serban Nicolae was adopted tacitly by the Senate. Provided that this legislative initiative toughening the operating conditions of NGOs was adopted tacitly by the plenary of the Senate Monday, Save the Children organization expresses its deep concern regarding the content of the draft law amending the rules followed by associations and foundations.

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