Romania still has a lot to offer to foreign investors. Foreign direct
investments grew by more than 21% and the number of new foreign-capital
companies increased by over 35% in H1/2022 year-on-year. Romania can
take advantage of the current geopolitical and economic conditions, as
there is major pressure on companies to bring their suppliers closer to
home in order to attract investments. Daniel Anghel, Board member and
Chair of the FDI Task Force within the Foreign Investors’ Council
(FIC), stated that “Romania can benefit from the current geopolitical
and economic context, which puts a lot of pressure on companies to
bring their suppliers closer to their production sites in order to
attract investment. As a result, many companies are targeting Central
and Eastern European countries (Romania, Poland, Hungary, the Czech
Republic) at the expense of Asia.”
The government expects Romania’s economy to grow by 4.6% in 2022 and by
2.8% in 2023, despite inflation, the energy crisis in Europe or the
looming recession in the euro area, according to the National
Commission for Strategy and Prognosis (CNSP)’s autumn forecast, which
the budget adjustment in November will be based on. The government’s
forecasts are still below those of the International Monetary Fund or
the World Bank, but inflation remains a heavy burden, which has
generated over 25% price increases in the past two years.
Euro area inflation is expected to be 10.7% in October, up from 9.9% in
September, according to a flash estimate from Eurostat. Differences
among countries are significant. Inflation in Lithuania is expected to
reach 22% (the same as in Latvia), France has a 7.1% estimated
inflation rate for October and Spain - 7.3%. In Romania, the latest
data showed inflation was getting close to 16%. The rising inflation is
mainly generated by the increase in energy and food prices, Eurostat
also indicates.
Revenues from taxes and social contributions in the European Union
member states grew by EUR 520 billion, to EUR 6,058 billion, in 2021,
according to data published by Eurostat on Monday, 31 October. The
overall tax-to-GDP ratio stood at 41.7% in the EU in 2021, up from
41.1% in 2020. Eurostat data show that the tax-to-GDP ratio varied
significantly among EU member states. The highest shares of taxes and
social contributions as a percentage of GDP were recorded in Denmark
(48.8%), France (47%) and Belgium (46%). At the opposite end of the
scale, Ireland (21.9%) and Romania (27.3%) registered the lowest
ratios.
iBanFirst’s study on 2023 foreign exchange market presents a
macroeconomic overview for the coming year and the potential impact
that the evolution of the main currencies could have on Romanian
companies that process international payments and that should adopt a
policy of hedging against currency risk. iBanFirst experts argue that
economy is in an unprecedented situation and that a recession has
rarely been forecast so far in advance. Several economies are on the
verge of collapse: the euro area, Great Britain and countries where the
housing bubble has grown considerably over the past few years, such as
Canada and Australia.
The number of employees in the National Bank of Romania (NBR), the
institution that regulates and supervises the activity of commercial
banks in Romania, has grown by more than 8% over the past decade, i.e.
by 152 people, while the Romanian banking system has seen a 16.4%
decrease in staff, more than 10,000 bankers having left credit
institutions between 2012 and 2021. After an oscillating evolution in
the last decade, with a mainly upward trend in the number of employees,
but also with years of slight decreases, the number of employees in NBR
reached 2,018 at the end of 2021, compared to 1,866 employees in 2012,
according to data from NBR’s annual reports.
UniCredit Bank has extended the availability of the Mobile Banking app
for Huawei mobile phone owners, via the App Gallery app store. The app
offers individual clients access to information regarding their
accounts, cards, loans and savings products with UniCredit and allows
them to perform operations more rapidly and easily (balance checks,
instant card blocking/unblocking operations, changes in cash withdrawal
limits for POSs, ATMs or online payments by card, repayments for credit
cards and loans at UniCredit Bank, currency exchanges, term deposits or
savings accounts, the possibility to update their identity card data by
uploading the document onto the app directly, etc.).
Aegon Romania ended the first half of 2022 with an 8.2% increase in
gross written premiums (GWP), i.e. RON 76.7 million (compared to RON
70.4 million in H1/2021) and with a 4.3% market share on the life
insurance segment, according to the information transmitted by the
insurer. The advance is in line with the evolution of the local
insurance market, the positive results having also been driven by the
current context, marked by two overlapping crises (the pandemic and the
war in Ukraine), which made Romanians place greater importance on their
safety and health, as well as on protection solutions in case of
unforeseen situations.
Cluj County Council has approved the technical-economic indicators for
the construction of the passage in the Tetarom III Park area in Jucu
locality, a RON 78.1 million (EUR 15.8 million) investment supported
with funds from the National Recovery and Resilience Plan (PNRR). The
passage will link DN1C national road to Tetarom III Industrial Park,
over the railway, according to a press release issued by Cluj County
Council.
Nusco Group is moving forward with the Nusco City project in Pipera and
plans to build an office component alongside a commercial one and a
two-lane boulevard and a tram line following some talks with the
Mayor’s Office of Sector 2 in Bucharest. Demand for offices is
prompting investors to launch new projects on the market that will be
finalized after 2025, especially considering that deliveries will slow
down over the next two years amid the lack of building permits in the
capital city of Romania.
Inflation and the recent changes in the Fiscal Code are prompting
Romanian entrepreneurs to invest in the digitalization and automation
of their companies’ processes in order to reduce expenses by up to 35%,
according to a press release. As a result, demand for software
solutions grew by 30% during the period January-September 2022 compared
to the similar period of 2021, NextUp data show. The cited source also
indicates that local companies invest between EUR 1,000 and EUR 8,000
in business management solutions, such as ERP systems, integrated
software solutions, to automate work processes with a view to
simplifying employees’ activity and to eliminating human errors.
On Monday, 31 October, President Klaus Iohannis promulgated the law
through which the National Cultural Program "Timişoara - European
Capital of Culture in 2023" will receive part of the necessary
financing from the state budget, namely RON 164 million to be ensured
by Timişoara City Hall, Timiş County Council, the Ministry of
Culture/National Theatre and the TM2023 Association. The normative act
amends and completes Government Emergency Ordinance (OUG) 51/1998 on
improving the financing system corresponding to cultural programs,
projects and actions, and amends Government Emergency Ordinance 42/2019
on establishing financial measures to support the implementation of the
National Cultural Program "Timişoara - European Capital of Culture in
2023".
On Monday, 31 October, President Klaus Iohannis promulgated the law
approving Government Emergency Ordinance (OUG) 80/2022, which suspends
recruitments for vacant positions in the public sector until the end of
this year. The normative act also introduces an exception allowing
competitions or exams to be held in order to fill vacant or temporarily
vacant positions within the services of the two chambers of Parliament.
On Monday, the Senate postponed the vote on the draft law approving
Government Emergency Ordinance 134/2022 through which the price of
firewood is capped until 31 March 2023, because the specialized
committees had not issued their report on the draft law. The deadline
for the tacit adoption of the act is Thursday, 3 November. The Senate
was the first notified chamber and the Chamber of Deputies is the
decision-making body.
Mayors of sectors in Bucharest and of county capital cities can benefit
from national security information, according to a draft law amending
Law 51/1991 on Romania’s national security adopted by the Senate, as
the decision-making body, during the plenary session on Monday, 31
October. There were 78 votes in favor of the draft law, 14 votes
against it and 26 abstentions. National security information obtained
from abroad by the Foreign Intelligence Service is exempted from the
provisions of the aforementioned draft law.
Cheniere, the leading exporter of liquefied natural gas (LNG) in the
United States, is "willing to build incremental facilities" to satisfy
growing European demand, it told EURACTIV, warning however that
additional capacity would not enter service before "the latter portion
of this decade". The US became the world’s largest exporter of
liquefied natural gas (LNG) during the first half of 2022, filling part
of the vacuum left by Russia, whose exports to Europe have plunged
following its February invasion of Ukraine. Falling supplies from
Russia have "really changed the flow dynamics" for gas in Europe, said
Corey Grindal, executive vice-president in charge of worldwide trading
at Cheniere.
Romanians are the best trained and informed drivers in Europe when it
comes to driving in winter, according to a study on European drivers’
attitudes and habits towards cold weather driving. 4,000 drivers from
eight European countries participated in the study. The study shows
that 76% of Romanian drivers replace their summer tires with winter
ones once the cold season starts.
Minister for Family, Youth and Equal Opportunities Gabriela Firea has
announced that thousands of cases of abused or neglected children have
come to the ministry’s attention over the past ten months, which is an
indication that the single emergency line for children 119 has proven
its usefulness. Minister Firea has also pointed out that there is still
reluctance to report child abuse. Moreover, the Social-Democrat (PSD)
minister has indicated that the institution she coordinates is working
hard to improve the 119 system and train the specialists who take those
calls.