The Foreign Investors
Council published the Business Sentiment Index (BSI) results for the
latest edition, spring 2022. The survey shows that there is a moderate
optimism among investors, however it is impacted by uncertainty and
current challenges such as: energy market crisis, military conflict in
Ukraine, inflationary pressures affecting supply chains and customer
demand, including the erosion of end-user disposable income, which
possible effects were highlighted in the May edition of the Inflation
Report published by the National Bank of Romania (NBR). Companies want
to invest in Romania, half of the respondents estimate that for this
year the planned investments are at similar levels to last year, and
40% of respondents say they plan to invest larger amounts compared to
the previous period. have plans to expand their workforce and 37% keep
these plans for the next 12 months at levels similar to last year. The
sentiment remains that there is a need for labor, but unfortunately the
perception of the availability of adequate staff remains reserved, only
45% of respondents believe that labor force is competitive. Reforms are
still needed in key areas such as infrastructure, transparency, and
coherence in the application of public policies, reducing bureaucracy
and the burden of regulations.
President Klaus Iohannis has stated that Russian President Vladimir
Putin and his war against Ukraine are to blame for Romania’s rising
inflation, and that the impact is a global one. The head of state has
added that the Romanian government has taken and will continue to take
measures to alleviate the effects of inflation. He has also advised
people to spend their money wisely. Specialists have transmitted that
Romania’s annual inflation rate grew to 13.76% in April 2022.
Romania recorded the biggest increase in inflation in Europe in April,
to 13.8%, but the latest data on the evolution of wages show that
incomes grew by more than 10% in February, which makes the rise in
consumer prices seem less alarming, according to John Hardy, head of
Forex analysis at Saxo Bank. Moreover, in Hungary, wages grew by 32%,
right before the elections in April, and inflation is estimated at
9.5%, lower than what the Netherlands had reported in both March and
April (9.7% and 9.6%), and less than what Romania is suffering in the
fight against inflation, the Saxo Bank analysis also indicates.
The optimism of CEOs in Romania about the evolution of Romanian economy
decreased following the outbreak of war in Ukraine, according to the
April revised edition of the CEO Survey 2022, conducted by PwC Romania.
As a result, the percentage of those expecting national GDP growth to
accelerate fell to 34% in April, from 59% in the January edition of the
report, while the share of respondents expecting a slowdown in economic
growth doubled, from 26% to 54%.
The Board of Directors of Patria Bank (PBK), a credit institution
controlled by the Emerging Europe Accession Fund investment fund, has
reconvened shareholders on 16 June 2022, to approve the issuance of
unsecured, non-convertible, subordinated bonds, through one or several
RON or euro-denominated issues, worth EUR 5 million altogether,
according to the notice to attend published at Bucharest Stock Exchange
on Thursday. If the proposal passes the shareholders’ vote, the Board
of Directors will establish the type and interest rate, the issue
currency, the maturity and nominal value of bonds for each financing.
Transilvania Broker de Asigurare (TBK), one of the biggest insurance
brokerage companies on the local market, recorded a 159.6% increase in
its net profit in Q1/2022, from RON 2 million in 2021, to RON 5.2
million, according to data in the quarterly report published on
Bucharest Stock Exchange (BSE). The company’s turnover reached RON 36.5
million, up by 66.3% against last year’s level, of RON 21.9 million
lei. On Wednesday, shortly after the start of the trading session on
BSE, TBK shares were up 5.3%, on over RON 600,000 transactions. The
most important category of operating expenses, represented by expenses
with commissions paid to assistants, grew by 58% (RON 10 million),
reflecting the increase in the volume of brokered premiums during the
reporting period compared to the reference period, the report
indicates.
Allianz Group, present on the Romanian market through the insurance
company Allianz-Tiriac, ended the first three months of 2022 with EUR
44 billion total revenues, up by 6.2% against the similar period of
2021, while its operating profit reached EUR 3.2 billion in Q1/2022,
down by nearly 3% year-on-year, according to information transmitted by
Allianz representatives. Allianz Group reached a net profit
attributable to shareholders of EUR 600 million in Q1/2022, having
recorded an over 78% decline compared to the first three months of
2021.
Agroland Business System (stock exchange symbol AG), the Romanian
retail, agricultural and food entrepreneurial group that owns the
largest network of agricultural stores in Romania, has announced on
Bucharest Stock Exchange that it opened its 18th Agroland MEGA store in
Romania. The investment in Agroland MEGA Timişoara amounted to EUR
200,000, not including stock.
On Thursday, FAN Courier inaugurated its latest investment of the past
few years, the Cluj-Napoca regional HUB, a project that helps the
company fulfill its mission, as promised nearly 25 years ago when
Adrian Mihai, Neculai Mihai and Felix Pătrășcanu had set up the first
Romanian company in this industry, according to a press release.
According to the cited source, FAN Courier has invested EUR 14.5
million for the construction of the HUB in Cluj-Napoca, which is the
first project in Romania which includes a solution that optimizes the
courier services flow and reduces sorting and transit times. The HUB in
Cluj-Napoca is the second biggest such unit owned by FAN Courier, after
the one in Ștefăneștii de Jos - built ten years ago, but recently
modernized.
The Israeli from Hagag Development Europe will build a premium
residential project in Primăverii area in Bucharest, which will include
commercial spaces as well and which they will invest EUR 20 million
into. The plan is still in the design phase, but "H Primăverii 1" will
be built on a plot of land of 1,360 square meters and will provide more
than 4,000 square meters of apartments and commercial spaces, plus over
2,000 square meters of underground parking spaces.
German giant Mercedes-Benz intends to develop projects in Romania in
order to switch to the production of components for electric vehicles,
through major investments in the following period, according to the
message transmitted to the Romanian authorities. The company has
received EUR 35 million state aid for the purchase of machinery.
Daimler started producing the new 8G-DCT gearbox, a highly-performing
automatic gearbox with latest generation technology, at its plant in
Sebeș, in 2019.
The Ministry of Research, Innovation and Digitalization has announced
that the draft law banning the use of Russian software in public
institutions and by authorities in Romania has been put up for
consultation. According to a press release issued by the Ministry, the
presence of Russian antivirus software solutions may represent a
vulnerability to the cyber security of Romanian authorities and
institutions, considering that the Russian Federation is also using
cyber-attacks against Western states and is using its national
companies and Russian citizens, through various methods, in the war
against Ukraine.
On Thursday, President Klaus Iohannis promulgated the law increasing
the maximum speed limit outside localities, on express roads, from 100
km/h to 120 km/h. The draft law signed by Save Romania Union (USR) had
been adopted by Parliament on 13 April. According to the law, paragraph
(4) of Article 49 is amended as it follows: "(4) Maximum speed limits
outside localities are: a) on highways - 130 km/h; b) on express roads
- 120 km/h; c) on European national roads (E) - 100 km/h; d) on other
categories of roads - 90 km/h."
While the date for the ratification of the Second Additional Cybercrime
Protocol by the European Parliament is yet to be set, civil society and
some MEPs have called for the opinion of the European Court of Justice
over data and privacy concerns. The Second Additional Protocol to the
Budapest Convention on Cybercrime was opened for signature at the
Council of Europe in Strasbourg on Thursday, 12 May. It is modernizing
the original convention of 2001 to adapt to the challenges of the 21st
century, aiming to ensure a common and cooperative criminal policy
approach. In November 2021, Ministers at the Council of Europe formally
approved the Protocol. Now, after the countries’ signing on 12 and 13
May, the text needs to be given consent by the European Parliament.
The average gross wage in economy was RON 6,401 in March, RON 342
(+5.6%) higher than in February, according to data published by the
National Institute of Statistics (INS) on Thursday. The average net
wage stood at RON 3,937, up by RON 216 (+5.8%) against the previous
month. The highest values of the average net wage were recorded in
information technology service activities (including computer service
activities) – RON 9,968, and the lowest ones were recorded in hotels
and restaurants – RON 2,079.
42% of 1st-8th grade students are illiterate when it comes to writing,
reading and understanding a text, according to data from the National
Literacy Report, which assessed the level of functional literacy skills
(text writing, reading and comprehension) of children in Romania. The
level of functional illiteracy in Romania has reached alarming levels,
according to representatives from the Association for Values in
Education and from the Brio platform, two of the entities to have drawn
up the aforementioned National Literacy Report.
51% of Romanians have considered leaving Romania since the outbreak of
the war in Ukraine, while 12% are waiting to see how the situation will
evolve and 11% believe the war will not affect Romania, according to a
survey conducted by BestJobs recruitment platform. Moreover, 26% of
respondents said they would not take this step regardless of how the
situation evolves. Proximity to relatives or acquaintances (27%) and
distance from the war zone (24%) add to the list of reasons for
relocation.