The Foreign Investors Council (FIC) appreciates the Government’s efforts to reduce spending, but believes that the Ordinance adopted by the Government on 30 December 2024, which includes new tax increases, did not provide the necessary time for a careful analysis by the business environment and the failure to respect the deadlines for public consultation within the legislative process is a negative signal that increases the degree of uncertainty for the future of investments in Romania. Moreover, the adoption of tax measures at the end of the year with immediate application from 1 January disrupts the business plans and budgets prepared by companies for next year, increasing unpredictability and reducing the appetite for future investments. The organization recalls that Romania has been facing a difficult budgetary context ever since 2019 and that it had warned, ever since the beginning of this year that a balanced approach by the authorities was necessary to ensure that the deficit assumed for 2024 was maintained.
Alexandru Reff, Country Managing Partner of Deloitte Romania and Moldova, spoke, in an interview, about his professional activity. He said that he liked to believe that aspirations defined people even more than accomplishments and he very much wanted to be a good person, with a positive influence on others and a valuable and lasting impact on the projects and communities he gets involved in. Alexandru Reff has been Country Managing Partner of Deloitte Romania and Moldova since 2017. He has solid experience in assisting foreign investors in various fields, as well as a broad understanding of the legislation and tax environment. Over the years, he has been involved in projects touching various important business topics such as financing, risk management, governance, sustainability, technology and management.
Electrode manufacturer Electrocarbon Slatina SA and Elsid Titu, in collaboration with the Energy Employers’ Federation (FPE), have criticized the reintroduction of the "pole tax" by the Government, which imposes a 1% tax burden on the value of industrial buildings. Energy industry representatives have warned that the tax will lead to significant increases in energy prices and discourage strategic investments in critical infrastructure such as renewable energy and natural gas production.
Romania could face the risk of a sharp fiscal deterioration in 2025 fueled by rising global bond yields, a scenario that threatens both economic stability and investor confidence, according to an iBanFirst analysis. By data, Romania’s deficit is forecast to reach 7% of GDP in 2025 and could increase as a result of a 12.1% pension hike from 1 January 2025. This measure, combined with the political uncertainty generated by the elections, may lead to a higher risk premium for Romanian bonds and higher borrowing costs.
The Ministry of Energy has announced that the volume of natural gas exported from the Neptun Deep perimeter to Germany will represent less than 1% of the total estimated production of the Black Sea deposit, which has estimated reserves of over 100 billion cubic meters of natural gas. OMV Group has concluded an agreement with Uniper to supply 15 terawatt-hour of natural gas from the Neptun Deep project starting from 2027, following the suspension of Russian supplies via Ukraine and the reduction in Russian energy purchases.
The "Chain" Ordinance, assumed by the Government in the last days of 2024, contains several economic measures aimed at regulating budget spending and reducing the budget deficit, which has reached 7.9% of GDP, almost double the level recorded at the end of 2023. The ordinance brings certain changes that may also affect the lending market. For example, the elimination of tax breaks for certain sectors (IT, construction, and agriculture) and the increase in some taxes (e.g. dividend tax) may reduce the population’s disposable incomes.
Bucharest City Hall (PMB) has signed a RON 295.7 million loan contract with Banca Comercială Română (BCR) and UniCredit Bank Romania, to refinance local public debt due in 2025. UniCredit won one lot of the tender, for RON 116.853 million, while BCR won two other lots totaling RON 178.834 million. The City Hall will pay RON 111.31 million total interest, estimating RON 111.994 million total costs over the ten-year crediting period, according to the tender specifications.
Development Minister Cseke Attila has announced that the Casino in Constanta is now one step closer to reopening. The casino’s rehabilitation was financed from the state budget, implemented by the Ministry of Development, Public Works and Administration, through the National Investment Company, and the delivery-acceptance process is expected to be finalized in the first half of February, after the verification of the works carried out, the testing of the restored installations, as well as the training of the staff who will maintain the building and the technical systems.
A new factory where plastic components for the automotive industry will be manufactured is to be built on a plot of land at the entrance to the city of Hunedoara. Works on this investment will be completed in the autumn of 2025 so that production can start at the end of the year, the local administration indicated on Wednesday, 8 January. Forty new jobs will be created here, but company representatives told the local administration that the project targeted a subsequent increase in production capacity, which will lead to a doubling of the number of jobs.
German aviation giant Lufthansa Group is set to take a stake in Italian state-owned airline ITA Airways on 13 January, following years of negotiations over a deal, dpa has learnt. Lufthansa is to initially acquire a minority 41% stake in ITA for a capital contribution of EUR 325 million. Under the agreement with the Italian Ministry of Economy and Finance, the German company can take over the Italian airline entirely in two further steps by 2033, possibly for another EUR 830 million currently under discussion.
Young people will be able to complete two years of studies in one school year in pre-university education, according to an order published in the Official Gazette of Romania on Wednesday, 8 January. Completion of two years of studies in one school year is achieved by attending at least 50% of classes corresponding to the current year and at least 40% of classes for the second year of study, according to the personalized study plan developed by the monitoring committee, individual study, consultations/tutorials provided by the primary school teachers/teachers of the second year of study. The students will be evaluated in each subject/module included in the educational framework-plan of the two years.
Romanians will be able to travel to the United States for tourism or business purposes without the need to obtain a visa, Romanian media reported on Wednesday. Romania’s entry into the US Visa Waiver Program will be marked by a ceremony in Washington on Friday, according to a press release by the Romanian embassy. US Homeland Security Secretary Alejandro Mayorkas and the Romanian Ambassador Andrei Muraru will meet to formalize Romania’s admission and announce the exact date from which Romanians will no longer need visas. The Visa Waiver Program allows for travel to the US without a visa for up to 90 days, for tourism or business. Once joined, Romanian citizens will be able to register online for travel authorization at a cost of USD 21 (EUR 20), valid for a period of two years.
The Romanian National Post Company (CNPR) announced, in a press release, that it would start distributing pensions for January on Friday, 10 January 2025, in accordance with the agreement concluded with the National House of Public Pensions. More than 14,000 employees of the Romanian Post Company will be mobilized daily in this process, over 10,000 of them being postal couriers. The Romanian National Post Company is the national postal services operator and is owned by the Romanian state, which holds 93.52% of the shares, while Fondul Proprietatea has a 6.48% stake.
Romanians are forced to look for alternatives to supplement their incomes amid the increasingly unstable economic climate, with rising inflation and tax changes reducing purchasing power. According to a survey conducted by jobs platform DeLucru.ro, the number of people looking for a second job has increased by 51.89% in the past 7 days alone, the percentage representing new users. The measures included in Chain Ordinance 156/2024 have led to a reduction of net incomes, the new taxes being the main cause for the change in people’s professional behavior, as indicated by 30% of those surveyed.