News

Daily Newsletter - 13 August 2019

Summary

Macroeconomic News (4)

Industry business down in June

The aggregated turnover of industry companies dropped 0.2% in June, compared to the corresponding month of 2017, according to data released by the National Statistics Institute (INS) on Monday. The drop came on the heels of a healthy 7.6% growth rate in May.

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Economic expansion could begin slowing down in 2020

The economic expansion could begin to slow down in 2020, which indicates that the economy will continue to grow significantly above potential this year and moderately above potential in 2020, according to the minutes of the monetary policy meeting held by the National Bank of Romania's (BNR) board.

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Cabinet adopts budget revision

The Cabinet adopted the budget revision, featuring a RON 4.4 billion increase in allocations to the local authorities. The Ministry of Education lost RON 1 billion, the Ministry of European Funds lost RON 681.9 million, while the Ministry of Research and Innovation lost RON 369.1 million.

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Inflation back above 4%

The annualized consumer price index was up 4.12%, even though prices dropped by 0.20% in June. The base effect of June, 2018, had been -0.48%. The decisive role was played by the volatile prices of fresh and canned vegetables, which fell almost 7%.

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Financial News (3)

ING Bank Romania posted RON 385 million in H1 earnings

ING Bank Romania has logged RON 385 million in earnings for the first half of this year, up 12% compared to the corresponding period of 2018. The gross earnings amounted to RON 451 million, up 16% year-on-year, while revenues jumped 15% to RON 1 billion, thanks to growing demand and positive margin trends.

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OTP Bank posts RON 54 million in H1 earnings

OTP Bank reported almost RON 54 million in earnings for the first six months of this year, up 2.6 times on an annual basis. The bank's profitability was boosted by an increase in operating revenues, especially interest revenue, as well as improvements in the quality of its loan portfolio, which led to a drop in provisions for liabilities.

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Radu Ghetea nominated for Libra Bank board chairman

Radu Ghetea will join Libra Internet Bank as a board member in the coming months, according to an official press release. "I think my experience, accumulated while working for various finance and banking companies, coupled with the successful entrepreneurial spirit of Libra Internet Bank, could have a crucial contribution to the bank's fast and safe development, both in its traditional domains and in areas that will soon be explored," said Ghetea.

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Investment News (1)

Apex Alliance opens Hilton Garden Inn Bucharest Airport

The Apex Alliance group has opened the Hilton Garden Inn Bucharest Airport, the first hotel located at the Henri Coanda Airport. The EUR 19 million location belongs to the focused hotels business of the Hilton chain, boasting 218 rooms. The hotel is only 150 meters from the airport's Departures Terminal.

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Legislative News (1)

Sugary drinks excise to be discussed with business community

The excise on drinks with high sugar content will be approved by the Cabinet only after extended talks between the Ministry of Health and the business community, according to assurances given by the Minister of Finance, Eugen Teodorovici. The other measures in the Cabinet's plan, including the 50% reduction in state secretary positions and the state hiring freeze, will be discussed within the ruling coalition.

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Politics (2)

Ruling coalition survives negotiations

Prime Minister Viorica Dancila stated on Monday, after the PSD Executive Committee meeting, that the Social Democrats would continue to cooperate with ALDE. The party also rejected the idea of bringing PRO Romania within the ruling coalition and the Cabinet. The Prime Minister added that the PSD does not accept ultimatums and that there would be no cabinet restructuring.

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ALDE sets terms

ALDE told Prime Minister Viorica Dancila that it expects a new governing program and a restructured cabinet by August 20. A press release was issued 2 hours before the PSD Executive Committee meeting, discussing the relationship between ALDE and PSD. The press release made no mention of bringing Pro Romania into the ruling coalition.

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Social (1)

Demographic decline worsened

Romania's population continued to shrink because of demographic reasons. In June, the population dropped by 5,365 residents, compared to a loss of 2,636 in the corresponding month of 2018. The main reason is the fall in birth rates, according to data released by the National Statistics Institute (INS).

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