Daily Newsletter - 17 June 2022


FIC (1)
Macroeconomic (3)
Financial (3)
Investment (3)
Legislative (4)
European News (1)
Social (2)
PM Nicolae Ciucă discussed with representatives of the Coalition for Romania’s Development

The Government has announced that on Thursday, Prime Minister Nicolae Ciucă met, at Victoria Palace, with representatives of the Coalition for Romania’s Development (CDR). Daniel Anghel represented the Foreign Investors Council (FIC) at the meeting and will coordinate CDR on behalf of FIC starting with 1 July. The topics presented by Daniel Anghel were related to macroeconomic stability and the predictability and transparency of the fiscal system. He also highlighted the importance of the dialogue between the business community and the authorities in order to stimulate the economic development of Romania

Prime Minister Ciuca met with representatives of the Coalition for the Development of Romania

The Prime Minister met with business representatives

Press release - Government of Romania

Prime Minister Ciuca met with representatives of the Coalition for the Development of Romania

Prime Minister Ciucă discussed with the representatives of the Coalition for the Development of Romania about topics of interest

Prime Minister Nicolae-Ionel Ciuca’s meeting with the representatives of the Coalition for the Development of Romania

Inflation will peak in June-July, at 15%
Inflation will continue to grow in June and July, when it will peak at an annual rate of 15% or even higher, Ionut Dumitru, chief economist at Raiffeisen Bank Romania, stated during the ZF Live business program. The latest inflation figures for May 2022 show a 14.5% generalized increase in prices, on the average basket of consumer products and services in Romania, according to data from the National Institute of Statistics (INS). In his opinion, inflation is lower thanks to the capping of energy prices. Had the energy and gas prices not been capped for most end consumers, inflation in Romania would have exceeded 20%.
Social Democratic Party will propose several measures within the ruling coalition
The Social Democratic Party (PSD) will propose, within the ruling coalition, a 40% surtax on public sector salaries that exceed the Romanian President’s salary, a two-step surtaxing of special pensions, a progressive system of deductions for salaries under RON 4,500, as well as a contribution for Healthcare and Education of 0.5% of the turnover to be paid by companies with over EUR 100 million annual revenues. Given the social solidarity and fairness principles that must underpin the reform of the tax system in Romania, PSD believes that the tax regime applied to taxpayers needs to be differentiated, depending on their income. Therefore, the new tax model must introduce higher taxes for those with high incomes and lower taxes for low-income earners, according to the Social Democrats.
Turnover from market services provided to the population grew by 40.5%
Turnover from market services provided to the population grew by 40.5% as a gross series and by 43.2% as a working days and seasonally-adjusted series in the first four months of 2022, compared to the same period of 2021, according to data published by the National Institute of Statistics (INS) on Thursday. Moreover, the turnover from wholesale and retail trade, maintenance and repair of motor vehicles and motorcycles increased by 6.3% as a gross series during the period 1 January - 30 April 2022, compared to the similar interval of 2021.
Patria Bank shareholders give green light to the issuance of €5 million bonds
The shareholders of Patria Bank (stock exchange symbol PBK) approved - following the Extraordinary General Meeting on 16 June - the issuance of RON or euro denominated unsecured, non-convertible bonds, in dematerialized form, within one or several issues, worth EUR 5 million altogether, according to a report published on Bucharest Stock Exchange on Thursday. Patria Bank recorded a net profit of RON 9.5 million in 2021, up by 238% year-on-year, and RON 1.1 billion new loans, up by 32%, according to the preliminary financial report.
Allianz-Tiriac recorded RON 820 million gross underwritten premiums in Q1/2022
Allianz-Tiriac ended the first quarter of 2022 with approximately RON 820 million gross underwritten premiums, more than twice the level recorded in the same period of 2021. The increase in sales was generated by the expansion of the client portfolio. The operating profit, the remaining amount following the payment of compensations, the forming of reserves and the deduction of operating expenses, stood at RON 45.3 million, slightly higher than in Q1/2021.
Central Depository distributes dividends corresponding to the year 2021
The Central Depository distributes dividends corresponding to the year 2021 to Banca Transilvania’s shareholders during the period 16 June 2022-15 June 2025. The value of the gross dividend per share is RON 0.1267533618. The shareholders to benefit from dividends are those registered in the issuer’s shareholders register on 6 June 2022, according to a press release issued by the Central Depository. Shareholders who are clients of a Participant in the Central Depository’s clearing and settlement system and register can collect their dividends through the Central Depository.
Lego invests over USD 1 billion in the USA
Danish toys maker Lego is to invest more than USD 1 billion in a factory in the USA in order to shorten supply chains and cope with the growing demand for colored plastic "bricks" on one of its biggest markets. The unit in Chesterfield County, Virginia, will be the Danish company’s second factory in North America, and the seventh unit at global level, after a new factory in Vietnam was announced last year. The investment is in line with Lego’s strategy of placing production close to key markets, a strategy that has helped the company during the period when the global industry was faced with supply chain disruptions following the pandemic. Moreover, the factory in the USA will be carbon neutral.
Buzău County to receive a huge sum for investments from the European Commission
Buzău County is to receive a huge sum for investments, namely EUR 300 million, from the European Commission. The money will be used for the expansion and modernization of the water and sewage network in the entire county. However, Buzău Water Company’s investments will entail higher prices. The biggest investment in Buzău County’s water and wastewater infrastructure since 1990 was recently announced by the Mayor of Buzău, Constantin Toma, president of the APĂ-2008 Intercommunity Development Association, which ensures the management of Buzău Water Company.
Real estate developers continue investments in Romania
Real estate developers continue to expand their retail project portfolios in Romania. Spaces spreading on over 500,000 square meters have been announced for the next four years and ten of the planned projects have more than 10,000 square meters each. At regional level, projects totaling 270,000 square meters are under construction and in the planning phase in the West Central area. They will add to the existing stock of 1.4 million square meters. This area will thus continue to be the most developed in terms of modern retail spaces built there.
Government has adopted OUG on investment grants for SMEs
Minister for European Investments and Projects Marcel Boloş has announced that on Thursday, the Government approved the emergency ordinance on the provision of EUR 400 million total investment grants to small and medium-sized enterprises. He has indicated that there will be two stages of measures. One of them will be allocated EUR 60 million, with grants ranging from EUR 50,000 to EUR 200,000, and targets service provision capacity and the rebuilding of service provision capacity in areas such as education, healthcare, social assistance and services provided to the population. The second component refers to the provision of grants for rebuilding the resilience capacity of SMEs affected by the crisis.
Deputy Cristina Prună managed to include two important changes into the Energy Law
The Vice-Chair of the Committee on Industries and Services, Save Romania Union (USR) MP Cristina Prună, has announced that she managed to include two important changes into the Energy Law that bring more transparency to the National Energy Regulatory Authority (ANRE)’s activity. As a result, the tariff comparator could be integrated into news websites. To be more exact, ANRE will have to transparently publish monthly data on market transactions and will make the tariff comparator application available to any interested party.
PNL submitted a draft law to mark the "Postpartum Depression Awareness Week" annually
Several Liberals have submitted a draft law in Parliament to mark the "Postpartum Depression Awareness Week" annually, before 1 October, the date designated as the "European Depression Day". The legislative proposal completes the Law on Mental Health and Protection of People with Mental Disorders no 487/2002 and was initiated by PNL Senators Alina Gorghiu, Monica Anisie, Lucia Dina Mutean and by PNL MP Adrian Hatos.
Government approved draft law for the purchase of 32 F-16 aircraft from Norway
The government approved the draft law for the purchase of 32 F-16 aircraft from Norway during Thursday’s meeting. According to the draft law, the Romanian Government will award the contract for the acquisition of 32 F-16 aircraft, with initial logistic support and a complementary package of goods and services (ensured by the US Government) to the Government of Norway, in order to achieve the transitional air operational capability stipulated in the Air Defense Capability Gradual Achievement Concept, within the "Air Force Multirole Aircraft" program.
European News 
Romania received the first quantities of natural gas extracted from Midia Gas Development
Romania received the first quantities of natural gas extracted from the Midia Gas Development (MGD), the first new offshore gas development in Romania in more than three decades. The project is developed by Black Sea Oil & Gas, a company owned by global investment firm Carlyle International and the European Bank for Reconstruction and Development, in the Ana and Doina gas fields in the Black Sea. The MGD Project is expected to deliver approximately 500 million cubic meters of gas this year, with peak production expected to be around one billion cubic meters per year for the following three years out of the ten estimated for the gas fields. Thus, the project is expected to cover around 10% of Romania’s gas consumption.
Almost half of Romania’s population lived in overcrowded households in 2020
About 17.5% of the European Union’s population lived in overcrowded households in 2020, i.e. households that did not have at their disposal a minimum number of rooms available, depending on the household’s size, family situation and the ages of its members. In Romania, nearly half of the population (45.1%) lived in overcrowded dwellings, the highest level in the community bloc, according to data published by Eurostat on Thursday. Other countries with high overcrowding rates are Latvia (42.5%), Bulgaria (39.5%), Poland (36.9%) and Croatia (36.2%).
Nearly a quarter of Romanians are considering emigrating because of inflation
More than seven out of ten Romanians (72%) believe that a crisis will follow and their main reason for concern is the increase in prices of consumer goods, Marius Luican, general manager of Reveal, a market research company, stated during an event organized by Raiffeisen Bank Romania. To protect themselves from inflation, six out of ten Romanians are considering reducing consumption, another 42% plan to ask for salary increases, a quarter of Romanians are considering emigrating and 16% might change their current jobs.