Daily Newsletter - 18 October 2021


Macroeconomic (4)
Financial (3)
Investment (3)
Legislative (1)
European News (1)
Social (2)
European Commissioner warns of a rise in energy poverty in the European Union
European Commissioner for Jobs and Social Rights, Nicolas Schmit has warned of a rise in so-called energy poverty in the European Union this winter due to the sharp rise in energy prices. He told Agerpres press agency that millions of people in the entire community bloc were affected by poverty, and the number of people unable to heat their homes was expected to rise in the following period. While the European Commission can help EU countries to limit the impact of the high energy price on the public, it is primarily up to national governments to take action, according to Commissioner Schmit.
Moody’s rating agency improved Romania’s outlook from negative to stable
On Friday, 15 October, Moody’s rating agency improved Romania’s outlook from negative to stable, based on the solid economic growth prospects, which will rely on the dynamic private sector and the use of Next Generation EU funds, and the existence of an excessive deficit procedure which is expected to act as a key policy anchor of a consistent and sustained fiscal consolidation strategy. The agency underlined Romania’s strong growth potential and expectation of a gradual improvement in the fiscal metrics, but also the policy inconsistency resulting from unstable government coalitions.
A high degree of uncertainty is associated with absorption of EU funds allocated to Romania via PNRR
A high degree of uncertainty is associated with the outlook for the absorption of EU funds allocated to Romania via the Recovery and Resilience Facility, as well as of those under the new Multiannual Financial Framework 2021-2027, according to the members of NBR’s Board of Directors, who referred to the approval, by the European Commission, of the National Recovery and Resilience Plan, but also to the steps that still needed to be completed ahead of the commitment of funds, as well as to Romania’s institutional capacity and track record in that respect, according to the minute of the monetary policy meeting of NBR’s Board of Directors on 5 October, published on Friday. During the meeting, the Board discussed and adopted the monetary policy decision, based on the data and analyses on current and future macroeconomic, financial and monetary developments.
NBR warns about future fiscal policy stance, which is likely to jeopardize budget consolidation
The National Bank of Romania (NBR) indirectly warned about the Government’s fiscal policy stance, which further deteriorates the situation of public finances, as Romania is faced with a large budget deficit, which will be very difficult to reduce, given the large volume of permanent budget expenditures, according to the minutes of the monetary policy meeting on 5 October. Moreover, the surge in energy prices, hence the increase in utility bills, will generate new problems, especially considering that those bills need to be compensated.
Ten-year government securities had a 5.08% reference rate on Friday, 15 October
Ten-year government securities had a 5.08% reference rate on the secondary market on Friday, 15 October, slightly lower than last Thursday, when they had stood at 5.09%. According to NBR data, 115 RON-denominated securities, worth RON 3.1 billion, and 6 euro-denominated securities, with a total value of EUR 13 million, were traded on Thursday, 14 October. Moreover, interest rate on six-month government bonds grew at a faster rate, to 3.19%, from 2.90% on Thursday, while interest rate for bonds with three-year maturity rose to 4.02%, from 3.84%.
City Insurance had recorded RON 1.04 billion underwritten RCA premiums by the end of H1/2021
City Insurance, the leader of the RCA segment and of the insurance market, which lost its operating permit and whose bankruptcy has been requested by the Financial Supervisory Authority (ASF), with the launch of the corresponding procedure by the end of September 2021, had recorded RON 1.04 billion underwritten premiums on the RCA segment by the end of H1/2021, up by 27.7% compared to H1/2020, according to ASF’s report. City Insurance thus managed to exceed a 46% market share in H1/2021.
The number of active mandatory home insurance policies grew by 3.88% in September
The number of active mandatory home insurance (PAD) policies grew by 3.88% in September 2021, to approximately 1.83 million, compared to 1.76 million active PAD policies on 30 September 2020, according to the statistics published by the Natural Disaster Insurance Pool (PAID), the company that issues this type of insurance. There were 1.75 million active policies on 31 December 2020. According to PAID, at the end of September, 74.9% of the active policies at national level were concluded in urban areas and 25.1% in rural areas.
AROBS Transilvania Software attracted RON 75 million from investors within a private placement
AROBS Transilvania Software, a Romanian IT company controlled by entrepreneur Voicu Oprean from Cluj, closed a private placement of shares on Friday, 15 October, and attracted RON 75 million from investors. The company put up for sale a number of 54.7 million shares, and investors had submitted subscription orders for 154.5 million shares by Friday, at 17:00, which results in a 2.82-fold over-subscription.
Mădălin Tomescu launched Kuziini, the only 100% digital custom-made kitchen concept store
Romanian entrepreneur Mădălin Tomescu launched, following an approximately RON 1 million net investment, Kuziini, the only custom-made kitchen concept store which functions 100% digitally. The founder of Kuziini has over 20 years of business experience in the furniture industry, where he has developed several businesses in the residential and commercial furniture production segment, targeting hotels, stores, company headquarters and universities. The Kuziini concept store operates without staff, and customer access is ensured through a face recognition system installed at the entrance.
Nicoleta Munteanu launched Kids in Business, an entrepreneurial education project, in 2020
Educating and encouraging entrepreneurial skills from an early age has become an essential component in preparing children for adult life and the development of society. After 18 years in managing the insolvencies of Romanian companies, Nicoleta Munteanu, founder and main shareholder of Euroinsol, launched in 2020 Kids in Business, an entrepreneurial education project which has so far been accessed by over 1,500 primary school pupils from private and public schools this year. The initial investment in the project amounted to about EUR 200,000 and was allocated for the development of entrepreneurship education programs.
Medical staff not vaccinated against Covid-19 will bear the costs of testing
On Thursday, 14 April, several senators and deputies submitted to Parliament a draft law establishing certain measures in the healthcare sector, during the state of alert period, for public and private units’ personnel. Thus, according to a press release issued by the Health Ministry, the staff within healthcare units with public and private beds will have the obligation to present an EU COVID-19 digital certificate in order to carry out their activity; otherwise the employees will have the obligation to pay for tests to detect coronavirus infection.
European News 
ANRE fined several natural gas suppliers for increasing the price of gas under fixed-rate contracts
Romania’s energy watchdog ANRE fined several natural gas suppliers for increasing the price of gas delivered under fixed-rate contracts. The government recently liberalized the country’s electricity and natural gas markets for households. Suppliers started providing a wide range of offers, but energy prices have since risen abruptly on global markets. The Romanian units of Engie and E.ON, plus two other firms, were fined because customers complained that the suppliers notified them of gas price increases during the contractual period although they had signed fixed-rate contracts.
Cioloș government proposes several to resolve the current situation in the healthcare system
Cioloș government proposed, in the governing program made public on Sunday, 17 October, several specific measures to resolve the current situation in the healthcare system, but also to stimulate vaccination against Covid-19. Access to events and stores would be made conditional on the green certificate and employees who refuse to present it would be dismissed. Moreover, Cioloș government wants to impose a two-week holiday for students, which will be recovered next summer by extending the school year - all to stop the wave of coronavirus infections.
Total number of pensioners in public pension system was 4,882,192 people at the end of June 2021
The total number of pensioners in the public pension system was of 4,882,192 people at the end of June 2021, down by 61,268 people compared to the corresponding period of 2020 and by 28,711 people against the end of December 2020, according to statistics from the Ministry of Labor and Social Protection. 95.13% of the total were state social security pensioners (4,652,346 persons) and 4.87% were agricultural pensioners (229,846 persons). The number of state social security pensioners was lower by 24,488 people on 30 June 2021 year-on-year, and the average pension was RON 219 higher.