Daily Newsletter - 10 January 2018


FIC (1)

The main fiscal changes 

2018 begins with dramatic changes in the fiscal and social contribution regulations. The latest changes were published in the Official Monitor in the closing days of December. Daniel Anghel, a tax partner with PwC, analyzed these changes for "Ziarul Financiar".


Macroeconomic News (5)

PwC says world economy to grow almost 4% in 2018 

The world economy is expected to grow almost 4% in 2018, adding USD 5 trillion to its current value. The Romanian economy will follow the general trend, according to consulting firm PwC. The main growth drives - USA, Asia's emergent economies and the Eurozone - will account for almost 70% of the international growth this year, compared to an average of 60% after 2000.


High crops cause problems 

2017 seems to have been a record year for some crops, a situation that pushed exports higher. However, Romania is unlikely to be competitive abroad because of its poor infrastructure. The good weather, the generous subsidies, the good management of fertilizers and the adequate treatment of crops boosted the output per hectare for both summer and autumn crops. The wheat, corn and barley harvests will be at least 10% higher, compared to 2016.


BCR sees overheating economy 

Horia Braun-Erdei, chief-economist of BCR, stated that Romania's economic cycle has reached an advanced stage and that a series of macroeconomic indicators point to an overheating economy. The statement was made at an event organized by the Bucharest Stock Exchange (BVB). The main drives of the national economy were services, industrial production and agriculture.


Utilities companies see 5.6% increase in gas prices 

The Federation of Associations of Energy Utility Companies (ACUE) announced on Tuesday that the increase in natural gas acquisition prices would push up the prices paid by households by an average of 5.6%, beginning on Wednesday. "The exact figure varies from supplier to supplier," noted an ACUE press release. Beginning with April 1, 2017, the price that suppliers pay to domestic producers for natural gas is no longer deregulated.


Industrial production prices up 

Romania's industrial production prices index went up 16.6% in November, the highest figure in the European Union. The second place went to Estonia (14.8%), followed by Belgium (13.9%), Lithuania (13.8%) and Latvia (13.7%).


Financial News (3)

Isarescu scared forex market 

The reference exchange rate posted by the National Bank of Romania (BNR) on Tuesday showed a 0.48% gain for the euro in one day, following Monday's key rate hike. Governor Mugur Isarescu announced that Romania would focus on interest stability at the expense of the exchange rates and that the exchange rates would probably fluctuate 5-6%.


Prima Casa bills come due! 

The debtors' efforts to keep up with Prima Casa installments will hurt consumption this year, according to Ciprian Dascalu, chief-economist of ING Bank Romania. Analyst Iancu Guda said the Prima Casa program should be wound down because it distorted the market and led to an unjustified increase in housing prices.


Dochia: "Deposit rates could grow in the second half of the year" 

The National Bank of Romania's (BNR) board of directors decided yesterday to increase the key rate from 1.75% to 2%. Economist Aurelian Dochia, an administrator with BRD-Groupe Societe Generale, said the interest rates would keep rising, albeit at a slow pace. "The inflation rate is not the only factor taken into account by BNR's board when setting the key rate," noted strategy adviser Adrian Vasilescu last year.


Investment News (2)

More than 30 hospitals to receive imaging equipment 

More than 30 hospitals will receive imaging equipment, such as CAT and MRI devices and PAC systems, according to the Ministry of Health. The procurement contracts are worth EUR 19.8 million and were signed on Tuesday by the Minister of Health, Florian Bodog, and representatives of the medical equipment suppliers. The ceremony was attended by Prime Minister Mihai Tudose and Deputy PM Ciolacu.


PHI Group has complex investment plan for Transylvania 

PHI Group, a US company that specializes in natural resources and agriculture investments, will build an industrial park, a gas-fired power plant and greenhouses for organic agriculture in Transylvania. The company has set up a joint-venture with a local operator.