Daily Newsletter - 1 March 2023


Macroeconomic (4)
Financial (4)
Investment (3)
Legislative (4)
European News (1)
Social (2)
The Macroeconomic Confidence Indicator grew in January
CFA Romania’s Macroeconomic Confidence Indicator grew by 5.4 points, to 43.3 points, according to a press release. This was due on the one hand to a 6.3-point increase in the current conditions component, and on the other hand to a 5.0-point increase in the expectations component. The expected inflation rate for the 12-month horizon fell by one figure, to an average of 9.18%. For 2023, the expected value of real GDP growth rose slightly against the previous year, to 1.9%. Public debt as a share of GDP is expected to grow to 57% within the next 12 months, the press release added.
Confidence in Romanian economy improved in February
The economic confidence indicator resumed its upward trend in February after two consecutive months of decline. However, only the services sector recovered, while other sectors, such as industry, continued to decrease. The confidence indicator points to a contraction or at best stagnation of gross domestic product in the first quarter of this year compared to the last quarter of 2022, some analysts believe. The Economic Confidence Indicator (ESI) grew to 101.7 points in February, from 100.6 points in January, but remains below December’s 102-point level and below the post-pandemic peak of 105.2 points reached in November.
Managers expect a sharp increase in prices in retail trade until April
Managers expect a sharp increase in prices in retail trade until April, as well as relative stability in constructions, retail trade and services, as well as in the number of employees in all activity sectors, according to data published by the National Institute of Statistics (INS) on Tuesday. According to February 2023 estimates, demand for services (turnover) will remain relatively stable over the next three months (cyclical balance +4%).
The annual decline of global trade volume accelerated in December 2022
The annual decline of global trade volume accelerated in December 2022, to 3%, the highest rate in two and a half years, from 1% in the previous month, according to the latest World Trade Monitor report drawn up by the Dutch institute CPB. The negative annual dynamics was driven by three consecutive monthly declines, bringing the quarterly decline to 2.1%, following a 1.3% increase in Q3/2022. Global imports accelerated their annual decline to 3.1%, from 0.9%, amid a 0.6% monthly decrease, and exports fell at an annual rate of 2.8%, following a 1.1% decline, amid a further 1.2% monthly fall.
Romanians can buy Tezaur government bonds in March
Romanians can invest in TEZAUR government securities with one-, two- and three-year maturities and annual interest rates of 7.20%, 7.50% and 8% respectively as of Wednesday, 1 March. The government bonds have a nominal value of RON 1 and are available in dematerialized form. Moreover, the income obtained from investing in the savings offer launched by the Ministry of Finance is not taxable.
Raiffeisen Bank listed a RON 369 million bonds issue on BSE
Raiffeisen Bank, one of the biggest bank in Romania, listed a RON 369 million bonds issue on Bucharest Stock Exchange (BSE) on 28 February, below the minimum own funds and eligible liabilities criteria, BSE has indicated. The issue has five-year maturity and an interest rate of 8.817% per year. The bonds were sold to qualified investors with a nominal value of RON 525,000. Such instruments, the same as those issued by other banks such as CEC, BCR, are not extensively traded on BSE and usually remain in investors’ portfolios until maturity.
Austrian group Erste ended 2022 with a EUR 5.95 billion net interest income
Austrian group Erste, owner of BCR, ended 2022 with a EUR 5.95 billion net interest income, up by 19.6% year-on-year, while its net profit attributable to owners of the parent-company rose 12.5%, to EUR 2.16 billion, according to the financial report published on the institution’s website on Tuesday. On 31 December 2022, the group’s total assets stood at EUR 323.8 billion, up 5.3% year-on-year.
BCR announces a net profit of RON 1.74 billion in 2022
Banca Comercială Română (BCR), controlled by the Austrian Erste Group, recorded a RON 1.74 billion (EUR 354 million) net profit in 2022, up by 23.8% against the RON 1.4 billion (EUR 286.5 million) result reported for 2021, thanks to an improved operational performance, supported by continued lending growth. In parallel, the operating result improved by 29%, to RON 2.73 billion (EUR 554.7 million), from RON 2.12 billion (EUR 430.8 million) in 2021, amid higher operating income, partly offset by higher operating expenses, according to the bank’s financial report.
Road company’s infrastructure investment expenditure doubled in 2022
The National Company for Road Infrastructure Administration (CNAIR)’s investments budget has been almost RON 40 billion in the past ten years, of which RON 8.4 billion was spent in 2022 alone, a record year for investments in road construction and maintenance. However, the average number of kilometres of highway inaugurated in the same period was only 30 km/year, while a large part of the road company’s investments must go towards the rehabilitation or maintenance of the existing network.
TeraSteel wants to expand with a new factory near Bucharest
TeraSteel, part of the Irish Kingspan group, wants to expand with a new plant near Bucharest, with construction works due to start in the coming months. The company will thus enter the market with a surplus of about 1.8 million square metres of sandwich panels, which it will sell not only in Romania but also for export. The plant will be finalized in the second or third quarter of 2024. The new plant will join the two units TeraSteel already owns in Bistrita and the one it opened in 2017 in Leskovac, Serbia.
Opus Land Development to invest EUR 50 million for development of Cosmopolis complex
Opus Land Development is to invest around EUR 50 million in 2023 for the construction of about 500 new residences in Cosmopolis complex, according to a press release. Total investments in Cosmopolis will thus exceed EUR 400 million. This is one of the biggest investments in a real estate project in Romania, regardless of the market segment or the area. According to the cited source, the around EUR 50 million investment budgeted for this year in the development of Cosmopolis is the biggest annual investment made by Opus Land since construction works started on the project in 2007.
Draft law on the tax regime for digital nomads has been adopted
The Chamber of Deputies has adopted, as a decision-making body, a draft law co-initiated by Save Romania Union (USR) MP Diana Buzoianu, which will allow foreigners who come to Romania for a longer period of time and work remotely for a non-EU company to benefit from tax facilities. The law will be sent to promulgation. The draft law aims to encourage specific activities carried out by digital nomads in Romania by establishing the applicable tax regime, namely exemption from income tax, social security contributions and health insurance contributions.
Chamber of Deputies adopted a draft law establishing ANDIS
On Tuesday, the Chamber of Deputies adopted a draft law providing for the establishment of the National Agency for the Development of Healthcare Infrastructure (ANDIS) as a specialized body of the central public administration. The law will be sent to promulgation. ANDIS’s role is to develop the healthcare infrastructure by preparing, implementing and completing investment projects of considerable importance in healthcare infrastructure.
Chamber of Deputies adopted a draft law amending Law 487/2002
Deputies have adopted, as a decision-making body, a draft law amending Law 487/2002 on mental health and protection of people with mental disorders and establishing the "Postpartum Depression Awareness Week" Program, which will be marked every year one week before 1 October - the European Depression Day. The normative act will be sent for promulgation.
Deputies adopted a draft law amending the law on adoption procedure
The Chamber of Deputies has adopted, as a decision-making body, a draft law amending an article of Law 273/2004 regarding the adoption procedure, by extending the duration of the accommodation leave from maximum one year to maximum two years, which includes the child’s placement for adoption, as well as a monthly allowance. The normative act will be sent to promulgation.
European News 
EU aiming for "targeted" reform of electricity market, energy chief says
The European Commission will present "targeted" proposals by mid-March to overhaul the EU’s electricity market, the bloc’s energy chief said on Monday (27 February), adding that the reform will focus on long-term power contracts for industry to mitigate price volatility. The EU’s electricity market "has not been able to protect consumers from the gas market crisis", which fueled a surge in power prices over the past two years, said EU Energy Commissioner Kadri Simson.
Seven out of ten women do household chores alone
Around 70% of women who live with their partner say they are also responsible for most household chores, such as preparing meals, washing dishes, washing and ironing clothes, as well as preparing children for various activities, according to a survey conducted by a BestJobs platform. For a third of women, "housework" takes up more than four hours, the equivalent of a part-time job.
Unemployment rate at national level reached 3.09% in January 2023
Unemployment rate at national level reached 3.09% in January 2023, up by 0.04% compared to the last month of 2022, according to data published by the National Employment Agency (ANOFM). The total number of unemployed recorded in the aforementioned period was 242,063 people, up by 2,999 against the end of the previous month.