Ramona Jurubiță, vice-president of the Foreign Investors Council (FIC), stated on Thursday that Romania’s accession to international structures was a beneficial element, and joining the Organization for Economic Cooperation and Development would be another important step towards attracting foreign investments. She gave the example of Romania’s neighboring countries and said that in Hungary, which had joined the OECD in 1996, the share of foreign investments in GDP had grown from about 28% to 56% in 2021, Estonia, which had joined in 2010, had recorded an advance from about 80% to over 97%, and in Latvia, which had joined in 2016, the share of foreign investments in GDP had increased from 51% to 61% in just 5 years.
An ECB official suggested on Thursday, 9 February, that people should reduce their wage demands amid the rising prices, so as not to fuel the inflation curve. A wage-price spiral would further complicate the ECB’s fight against inflation as it begins to slow down in the euro area. After having peaked at 10.4% in October, annual inflation rate in the euro area fell for three consecutive months and reached 8.5% in January, thanks to the easing of energy prices and the unlocking of supply chains.
Romania ended 2022 with a EUR 34.09 billion trade deficit, EUR 10.4 billion above the level recorded in the previous year (+44%), while exports grew by 23.1% and imports were up 28.1% year-on-year, the National Institute of Statistics (INS) reported on Thursday, 9 February. The deficit had reached EUR 23.5 billion during the economic crisis of 2008. Value-wise, exports of goods amounted to EUR 91.9 billion, while imports stood at EUR 126 billion.
On Thursday, 9 February, the National Bank of Romania’s Board of Directors examined and approved the February 2023 Inflation Report. Thus, the annual inflation rate is envisaged to decline to one-digit levels starting in 2023 Q3 already – almost three quarters earlier than in the prior forecast – and end the year far below the previously-anticipated value. It is then seen falling at a visibly slower pace in 2024 H2, according to the latest NBR forecast.
The National Bank of Romania’s Board of Directors decided on Thursday, 9 February, during its second monetary policy meeting of 2023, to keep the monetary policy rate at 7% per year and to leave unchanged the lending (Lombard) facility rate at 8% per year and the deposit facility rate at 6% per year. NBR also decided to maintain the existing levels of minimum reserve requirement ratios on both leu- and foreign currency-denominated liabilities of credit institutions, according to a press release on monetary policy decisions issued by the national bank.
Raiffeisen Bank granted 2,333 loans to more than 2,000 clients from various business sectors, with an approved value of EUR 592 million, in 2022 under the SME INVEST programs. Raiffeisen Bank recalls that it is one of the main partners of FNGCIMM, FGCR and FRC in the SME Invest program and has been, ever since joining this program in 2020, one of the key players on the market. In 2023, the bank aims to maintain the momentum of the previous year.
Banks have the obligation to send staff remuneration data for 2022 to the National Bank of Romania by 31 August 2023. Moreover, they will also have to report the difference in remuneration between male and female staff members by 15 June 2024, according to a draft NBR order. While the obligation to report the level of remuneration, especially that of senior management, already existed as a result of a 2014 order, the one to report remuneration level by gender is new. NBR has explained the need to report more data following the implementation of a European Banking Authority guideline (EBA/GL/2022/06 of 30 June 2022).
Ministry of Finance (MF) borrowed RON 980.4 million from banks through two benchmark government bond issues on Thursday, 9 February, according to data published by the National Bank of Romania (NBR). MF thus raised RON 415.4 million through a benchmark government bonds issue with 21-month residual maturity, at an average yield of 7.02% per year. The nominal value of the issue was RON 500 million and banks subscribed RON 620.4 million. An additional auction is scheduled for Friday, 10 February, where the state plans to attract another RON 75 million at the yield set on Thursday for the bonds.
Building materials manufacturer Soceram from Câmpina plans to build a new factory in Doicești locality, Dâmbovița County, where it already has a production unit, with the purpose of relocating the activity. The company also started works on an autoclaved cellular concrete (ACC) production unit in Târgu Cărbunești, Gorj County in 2022, a EUR 30 million investment which it plans to finalize in 2023.
PORR Construct, part of the Austrian group bearing the same name, plans to invest more than EUR 10 million in Romania in 2023. PORR Construct is working, among other things, on the construction of the Sibiu - Boița section of Sibiu - Pitesti Highway, part of the pan-European Corridor IV. PORR Construct ended 2021 with a RON 736 million turnover, down by 13% year-on-year.
More than half (56%) of managers and entrepreneurs in Romania have increased their investment spending in 2023 compared to the previous year, while 27% of them have maintained the same level of investments as in 2022, according to the ASEBUSS Investment Index survey, a quarterly research that tries to provide a clear image of the investment climate among companies in Romania. Ovidiu Dîmbean-Creța, the rector of ASEBUSS, has stated that the priority investment destinations in 2023 - digitalization, employee education and business process improvement, show that local leaders have made business decisions rather associated with developed economies.
Lidl continues to invest in Romania and inaugurates the largest logistics center in its portfolio in Fundeni Commune, Călăraşi County. The new warehouse, strategically located close to the A2 highway, will supply products to more than 55 stores in the south and south-east of the country. In addition, the new building stands out through an over 6,000 square meter mural, located on two sides of the building, made entirely of Airlite ecological paint that contributes to air purification.
Government has approved the decision approving the methodological norms for the implementation of the Milk and Dairy Law 307 of 2022, as well as the guide of definitions and terms used in the dairy industry. The Milk and Dairy Products Observatory will thus operate at the level of the Ministry of Agriculture and Rural Development, a structure that will monitor the cow, buffalo, sheep, goat and dairy products market, with a view to centralizing market data, but also monitoring, analyzing trends in Romania regarding production and the balance between supply and demand, including from the perspective of production costs.
Government has adopted a draft emergency ordinance on the establishment of a state aid scheme to support cattle breeders’ activity in 2022, amid the crisis generated by Russia’s aggression against Ukraine. Agriculture Minister Petre Daea has stated that the support measure targets 40,000 farmers. The estimated value of the aid scheme is RON 217,756,000 (equivalent to EUR 44 million), according to press release issued by the Agriculture Ministry.
Members of the European Parliament’s environment committee voted on Thursday (9 February) to strengthen requirements on climate protection in the proposed EU rules on corporate accountability. The proposal on corporate sustainability due diligence, presented by the European Commission in February 2022, would require large companies and small and medium-sized enterprises (SMEs) in high-risk sectors to prevent human rights violations and identify "adverse environmental impacts" along their value chain. On Thursday, MEPs from the environment committee adopted their opinion on the file, calling for stricter obligations on environmental and climate impacts for companies, including requirements to reduce their carbon emissions, in line with existing EU law.
Pensioners have called for a further increase in pensions starting from April 2023, in addition to the inflation indexation that took place in January, arguing that food prices have grown considerably. According to data from the National House of Public Pensions (CNPP), there were 4.6 million pensioners who received an average "ordinary pension" of RON 2,003 in December 2022, a RON 224 increase compared to the previous month (RON 1,779) when the average pension had only been RON 8 higher than in November.
Ministry of Education, in partnership with the World Bank, has developed the Early Warning Mechanism in Education (EWM), meant to individually identify, support and monitor students at risk of dropping out of school. Authorities expect an alarming drop-out rate in secondary schools in Romania unless concrete measures are taken. Specialists say that school drop-out is a complex phenomenon, triggered by a range of causes associated with various risk factors, from individual and family contexts and socio-economic backgrounds to cultural and social factors.