Daily Newsletter - 21 March 2019

Romania's productivity leap biggest in EU

Labor productivity per hour has increased in Romania by around 50% since the country's accession to the European Union, the fastest growth rate in the EU, and is now very close to a group of states posting lower growth rates (or even declining productivity). The group includes Poland, Hungary, Croatia and Greece, according to public data.

Massive imports wipe out gains

The current account of the balance of payments showed a deficit of EUR 114 million for the first month of this year, the equivalent of 0.05% of the estimated GDP. This situation is the result of a massive increase in the deficit shown by the goods and services balance.

ANAF returns RON 2.6 billion

The National Fiscal Administration Agency (ANAF) will reimburse RON 2.6 billion worth of VAT this month, according to a press release. All these reimbursements are subject to decisions registered before January 19.

Government's economic forecast not credible

Representatives of Mercer Marsh Benefits, part of Marsh Romania, the biggest corporate insurance broker in the country, expect the national economy to grow 3.4% this year, 2.1 pp below the Cabinet's forecast, which was used to draft the state budget.

BT to spend RON 1.2 billion on rewarding investors

Banca Transilvania, the biggest lender in the country, is planning to reward investors with dividends bearing an 8% yield, and to increase its share capital by RON 400.8 million. Investors will receive one free share for every 12 BT shares they hold.

Banker says Decree 114 is complex

Decree 114 is a complex product and every details needs to be understood before proposals are made, while the change in the calculation method of the ROBOR index is a delicate point of the negotiations, said the Executive President of the Romanian Banking Association (ARB), Florin Dănescu, on Wednesday, after the discussions with the Ministry of Finance.

Market share could determine asset tax

The financial asset tax will fall to 0.4% for banks with market shares of more than 1% and to 0.2% for the other banks, according to a proposal put forward at Wednesday's talks between the Ministry of Finance and the bankers.

MFP proposes changes to Decree 114

The Ministry of Finance (MFP) presented the banks with its latest proposal to amend the financial asset tax introduced by Decree 114. A series of assets are exempt from the tax, the tax rates are lower and banks can apply for an additional reduction.

Senate passes two highway bills

The Senate passed on Wednesday three road infrastructure investment bills focusing on the Bucharest-Brasov, Brasov-Bacau and Northern highways. The initiatives came five days after Romanians from across the country protested because of the lack of highways, as well as one day after Prime Minister Viorica Dancila called for "everyone to support the construction of highways." The Chamber of Deputies is the decision-making chamber on the three projects

Cabinet considers legalization of medical cannabis

The Minister of Finance, Eugen Teodorovici, announced on Wednesday that the authorities are considering the legalization of cannabis consumption for medical purposes. The Minister noted that the Ministry of Health is already looking into methods for making medical cannabis available to cancer patients.

President Iohannis attends Brussels meetings

President Klaus Iohannis will attend the European Council meeting in Brussels, on Thursday and Friday. The President will also be at the annual transatlantic conference organized by AmCham EU.

Confidence in country direction plunged

Only 16.9% of Romanians were convinced that the country was heading in the right direction in January and February, compared to 36.6% in July, 2017, according to a national survey conducted by INSCOP Research. The survey was commissioned by the Konrad Adenauer Foundation.