News

Daily Newsletter - 8 June 2017

Summary

Macroeconomic News (5)

Romania overtakes Greece 

The latest data released by Eurostat indicate that Romania's adjusted GDP exceeded that of Greece in the first quarter of this year, which makes Romania the biggest economy in the Balkans, excluding Turkey. This is the first time that Greece loses its top regional economy status in four decades.

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Net investment in national economy down 3.1% in Q1 

Net investment in the national economy reached RON 12.83 billion in the first quarter of this year, down 3.1% year-on-year, according to the National Statistics Institute (INS). Although new construction activity increased by 5% to RON 5.51 billion, investment in equipment and machinery dropped 6.5% to RON 6.16 billion.

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INS confirms GDP growth rate 

The National Statistics Institute (INS) confirmed on Wednesday the first quarter GDP growth estimates released in mid-May and provided details regarding the contribution of various sectors to the economic growth. The main drives of the national economy were the IT&C, services, retail and manufacturing sectors.

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Underground economy contributed EUR 38 billion to national GDP 

Romania's underground economy accounted for 22.4% of the GDP last year, the equivalent of EUR 38 billion, according to calculations based on the National Statistics Institute's (INS) figures. The national economy grew 4.8% in 2016, the highest growth rate since 2008.

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Aurelian Dochia, economic analyst: "The national production cannot keep up with the consumption growth rate" 

The national production cannot keep up with the consumption growth rate and Romania is forced to rely on imports, according to economic analyst Aurelian Dochia. "We need to invest in the national production system in order to cover the demand with our own products," said Dochia.

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Financial News (4)

Ministry of Trade says teaming up with banks is necessary 

Secretary of state Ilan Laufer, from the Ministry of Trade, stated that the Ministry would soon begin the process of selecting the partner banks of the Start-up Nation program. Laufer sees the involvement of banks as necessary for a smooth implementation of this program.

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Number of bad debtors down 

The number of private individuals who are more than 30 days behind in payments to the banks and NBFIs dropped 0.8% in April, compared to the previous month, according to data released by the National Bank of Romania (BNR). The combined bad debts of the country's 668,82 debtors amounted to more than RON 8 billion.

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BCR stopped taking Prima Casa applications 

BCR depleted its Prima Casa guarantee budget in March and has stopped taking applications from prospective clients, according to executive vice president Dana Demetrian. The average age of Prima Casa applicants is 30-35, compared to the 40-45 average age of standard mortgage applicants.

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IFC loans Alpha Bank EUR 50 million 

The International Finance Corporation has granted a EUR 50 million loan to Alpha Bank in order to support the bank's mortgage lending business in Romania. "The additional funds will allow us to provide more support to our clients' needs in a market that keeps growing every year," said executive vice president Periklis Voulgaris.

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Legislative News (2)

Senate brings back political control 

The Senate passed on Tuesday the amendment to the corporate governance decree in order to exempt certain state-owned companies from the private management rules. The Save Romania Union (USR) was the only party opposing the amendment.

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51% law to encourage partnership 

Law 321/2009, which makes it mandatory for retailers to source at least 51% of their food products from Romania, will encourage the formation of partnerships between producers and retailers. "The short chain is to be defined as a partnership between producers and retailers. It's a more accurate definition," said Aurel Popescu, president of employer group Rompan.

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Politics (2)

USR organization refuses to validate Nicusor Dan's resignation 

Nicusor Dan's resignation from the Save Romania Union (USR) must be validated by the Sixth District Organization (Bucharest), to which Dan belongs. However, party sources say the organization's leadership would not meet in the next two weeks in an attempt to leave the approval up to the Political Council.

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Former PNL leader against unified payroll bill challenges 

Senator Alina Gorghiu said that she would advise the National Liberal Party (PNL), whose former leader she is, to refrain from taking the unified payroll bill to the Constitutional Court because the bill "is the exclusive responsibility of the Social Democratic Party (PSD)".

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