News

Daily Newsletter - 19 June 2020

Summary

FIC (1)

CDR urged Parliament to refrain from passing the social dialog law amendment quickly

The Coalition for Romania's Development (CDR) voiced its concern regarding the process of amending the social dialog law in Romania, noting that the bill registered with the Chamber of Deputies could further disturb a labor market already affected by the COVID-19 pandemic. Previous discussions regarding this Project have led to the clear conclusion that it takes time, a detailed analysis and open debates to identify the solution that will allow an effective and constructive social dialogue in Romania.


CDR urged Parliament to refrain from passing the social dialog law amendment quickly 

CDR urged Parliament to refrain from passing the social dialog law amendment quickly

CDR urged Parliament to refrain from passing the social dialog law amendment quickly

CDR: Modifying the social dialog law would further disturb the labor market

CDR urged Parliament to refrain from passing the social dialog law amendment quickly

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Macroeconomic News (3)

Government debt almost 36% in of GDP in April

Public administration debt reached RON 405.1 billion (equivalent), i.e. 35.9% of GDP, at the end of April, 2020, up 8.4% from the end of 2019, according to a report from the Ministry of Finance (MFP), based on data "updated according to the fiscal notification". The state budget still relies on an economic contraction limited to -1.9%, while most forecasts range between -4% and -6%. The short-term debt is more than RON 18.98 billion lei, up 63% from 2019.

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Cabinet borrowed RON 1.15 billion at falling costs

The Ministry of Finance went to market with two more issues of government securities, one of which matures in more than 11 years. The amounts borrowed have once more exceeded their targets, but borrowing costs are declining. The bonds maturing in September, 2031, attracted RON 558 million in offers for an initial target of RON 200 million.

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CFA Romania analysts expect 8.5% budget deficit

CFA Romania analysts anticipate an average budget deficit of 8.5% of GDP and an unemployment rate of 7.8% for the end of this year. The 12-month estimate is an average reference exchange rate of RON 4.9424 / EUR. The worst forecast features a budget deficit of 18% and a reference exchange rate of RON 5.1 / EUR.

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Financial News (3)

BNR bought more state bonds, reduced repurchasing operations

The National Bank of Romania (BNR) decreased to RON 7 billion the "average daily stock" of repurchasing operations between May 15 and June 15, according to Governor Mugur Isarescu. The daily average stock for the April 1-May 15 period was RON 13 billion. At the same time, the value of state bonds bought from the secondary market was up RON 700 million on June 15.

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Isarescu: High interest rates are result of economic and financial situation

Governor Mugur Isarescu said interest rates fell after the National Bank's monetary interventions, including through the acquisition of state bonds, but they are still higher compared to those of other countries in the region because of Romania's economic and financial situation and especially because of the high fiscal deficit.

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Mioara Popescu, CEO of Idea Bank: We expect SME borrowing to recover

Mioara Popescu, CEO of Idea Bank, said the retail borrowing business dropped in March and April (when sales fell 30%), only to rise abruptly in May. April was the first month in two years when the bank's portfolio of loans contracted on a monthly basis.

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Investment News (2)

PMB applies for rehabilitation project financing

Bucharest Mayor Gabriela Firea told the General City Council at the beginning of Thursday's meeting that she had applied for financing for the rehabilitation of more than 200 kilometers of heating pipelines. The project is worth a total of EUR 330 million.

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First digital hospital managed by PMB

The General City Council of Bucharest (CGMB) adopted on Thursday the project regarding the digitization of all the hospitals managed by the City Hall. The pilot project will be implemented at the Colentina Hospital, but it lacks any kind of cost estimate or deadline.

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Legislative News (2)

ICCJ and People's Attorney refer special pension tax to CCR

The High Court of Justice (ICCJ) and the People's Attorney have referred the bill imposing a tax on special pensions to the Constitutional Court. ICCJ noted that the bill ignores repeated rulings on this issue, that the Superior Council of Magistrates (CSM) had not been consulted, and that a number of principles have been breached.

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Fines on exceeding overtime limits increased

President Iohannis signed on Thursday the bill increasing the fines paid by employers who fail to observe the overtime limit regulations. The new fines go up to RON 3,000 for every employee found working more than they should. The former regulations stipulated a fine of RON 3,000 for any number of employees found working above the limit.

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Politics (2)

President blasts motion of censure

President Klaus Iohannis said on Thursday that the motion of censure announced by the Social Democrats (PSD) has no basis in reality because the Government has taken the necessary measures to contain the spread of the pandemic and to promote economic recovery. "It seems wrong, unfounded and lacking in common sense," the president said.

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PNL to reform CCR after election

"I announced that after the elections we will prepare a proposal to change some rules. It's clear that the Constitutional Court must be changed and, unfortunately, changes are needed in the constitutional provisions and we will prepare an amendment so as to put the Constitutional Court in the constitutional framework, to determine the correct behavior of the Constitutional Court," said Prime Minister Orban. He stated that there have been many rulings lately "that created the impression that the Constitutional Court is a subsidiary of PSD".

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Social (2)

Cabinet to cover food vouchers for elderly, homeless people

The Ministry of European Funds (MFE) has prepared a draft decree establishing a national support scheme for the elderly and the homeless, by providing electronic vouchers for hot meals. Basically, low-income people over the age of 75 and the homeless will receive, through the local authorities, cards that they will be able to use to get hot meals in public restaurants.

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Romanians at 79% of EU average in effective individual consumption

Last year, Romania reached 79% of the EU 28's average standard of living, on par with Poland and above seven other member states, according to the actual individual consumption indicator (AIC / inhabitant) published by Eurostat. From the 19th place out of 27, Romanians are now one step away from Malta (80%) and Slovenia (81%)!

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