Daily Newsletter - 2 June 2022


FIC (1)
Macroeconomic (4)
Financial (4)
Investment (3)
Legislative (4)
European News (1)
Social (2)
The FIC Business Sentiment Index, spring edition 
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. .
Romania has sent to European Commission the first payment request from PNRR
On Tuesday, the Ministry of European Projects and Investments (MIPE) sent to the European Commission the first payment request under the National Recovery and Resilience Plan (PNRR), of about EUR 3 billion. Of the total of nearly EUR 3 billion, EUR 2.03 billion is non-reimbursable financial aid and EUR 0.90 billion is support in the form of a loan, according to a press release issued by MIPE. Of the amount requested for reimbursement in the payment request, Romania will receive EUR 2.56 billion, the resulting value after deducting the pre-financing received so far. As a result, EUR 1.77 billion will be reimbursed from the grants component and EUR 0.78 billion from the loans component.
Romania needs to go from a consumer economy to a production-based economy
Finance Minister Adrian Câciu has stated that Romania needs to make an economic conversion from a consumer economy to a production-based economy in order to increase competitiveness. The minister has also pointed out that the Romanian economy is going through a complicated situation, the same as all economies in Europe. Moreover, he has indicated that Romanian entrepreneurs remain united and committed to face the challenges, but they need support from the state as well.
Euro area inflation reaches new record high level
Annual inflation rate in the euro area continued to grow in May, as the war in Ukraine caused an explosion in energy and food prices. According to the flash estimate published by Eurostat on Tuesday, euro area annual inflation rate increased to 8.1% in May 2022, from 7.4% in April. This is a four times higher level than the European Central Bank’s (ECB) 2% target.
Romanians can buy Tezaur government securities at interest rates of up to 7.8% as of Thursday
Romanians can invest in TEZAUR government securities, with one-and three-year maturities and annual interest rates of 7.2% and 7.8% starting from Thursday, 2 June. The government bonds have a nominal value of RON 1 and are available in dematerialized form, according to the Ministry of Finance. Interest is annual, payable on the dates stipulated in the issue prospectus. Moreover, the government securities issued under the Tezaur Program are also transferable and can be redeemed in advance.
BRD CEO François Bloch has made several statements about the banking institution’s activity
François Bloch, CEO of BRD - Groupe Société Générale, has made several statements about the banking institution’s activity. He has indicated, among other things, that BRD concluded over EUR 500 million sustainable transactions in 2021, having marked several premieres on the local market, including the biggest green loan and the first issue of sustainability-linked bonds on Bucharest Stock Exchange, with BRD as the sole coordinator. In 2022, BRD has launched a comprehensive financing offer targeting consumer and real estate markets, while accelerating digitalization which will reduce the physical footprint.
Raiffeisen CFO Mihail Ion becomes Vice President of new Capital Markets Division
Raiffeisen Bank announced on Tuesday that it had appointed Mihail Ion as head of its new Capital Markets, Investment Banking and Personal Financial Planning Division, after he had been the bank’s Chief Financial Officer for five years. Mihail Ion has been with Raiffeisen for 20 years, including 10 years as CEO of Raiffeisen Asset Management subsidiary. His appointment will become effective after obtaining all the endorsements and the authorization from the National Bank of Romania.
Signal Iduna starts the integration of Ergo companies
Signal Iduna, the leader of the health insurance market, has started integrating the two Ergo companies on the Romanian market, after having received the final approvals from the Financial Supervisory Authority (ASF) and previously from the Competition Council, according to information provided by Signal Iduna. Upon launching the two companies’ integration process, Signal Iduna’s plans involve the merger of Ergo Asigurări de Viață, while Ergo Asigurări will continue to operate as an independent entity under the management of a new Board of Directors, approved by the ASF.
TBI Bank has entered into a partnership with Carvago platform
Annual inflation rate has increased considerably in Romania over the past year, and this upward trend will render acquisitions of higher value goods, such as cars, even more difficult. To make such purchases more affordable for consumers, TBI Bank has entered into a partnership with Carvago, an international online platform selling used cars, thus helping Romanians purchase cars through its BuyNow, PayLater (BNPL) solution, within an up to 60 instalments payment plan. TBI Bank is the only authorized financing institution on the platform for individuals, offering access to sums of up to RON 80,000, with online approval in just a few minutes.
Zaga Zaga complex in Siret Delta plans to invest EUR 20 million over the next three years
The Zaga Zaga complex in the Siret Delta plans to invest EUR 20 million over the next three years. The unit’s representatives want the complex to become the largest tourism hub in Europe. So far, the complex has benefited from EUR 15 million investments in the 137 accommodation units and facilities created for both Romanian and foreign tourists. Following the new investment, the tourism complex will expand both in terms of area and facilities.
BMW has started a giant investment in Hungary
BMW is to start construction works on the group’s most modern plant, in Hungary, located just a few kilometers away from the border with Romania, representing a huge investment of EUR 1 billion, which authorities in Bucharest also wanted to attract. The plant could work with Romanian suppliers, but it could also bring some of the group’s traditional suppliers to Romania. The BMW Group plant in Debrecen (Hungary) has entered the construction phase, at the end of the design and authorization stage, which means that the first electric car of a family generically called the Neue Klasse will be manufactured here in less than three years’ time, bringing new technologies and new production processes thanks to which this plant will become the "greenest" unit of the group.
New player has entered the private healthcare services market in Bucharest
A new player has entered the private healthcare services market in Bucharest. Doctors Gabriel Balcangiu Stroescu, PhD and Andra Balcangiu Stroescu, assistant professor, PhD, have opened the Doctor Balcangiu - Stroescu Clinic, following an over EUR 800,000 investment, according to a press release. The clinic is located in Pipera district and brings together 8 medical specialties: dermatology, nephrology, diabetes, nutrition and metabolic diseases, endocrine diseases, rheumatology, cardiology, plastic surgery and general surgery.
Parliament adopted draft law establishing 24 June as the "Day of the Romanian Traditional Blouse"
On Tuesday, the Chamber of Deputies adopted, as the decision-making body, the draft law establishing 24 June as the "Day of the Romanian Traditional Blouse". The law will thus be sent for promulgation. The endeavor, supported by senators and deputies from all parliamentary parties and national minorities, is a clear and balanced proof that the only policy of the Standing Committee for Relations with UNESCO is to safeguard national heritage, according to a press release issued by the Chamber of Deputies.
SRI can carry out activities financed entirely from its own funds, according to a draft law
The Romanian Intelligence Service (SRI) is authorized to use cover identities, documents, designators, movable and immovable assets while performing its duty, according to the draft law on SRI’s organization and functioning. The vague wording could suggest that SRI can carry out economic activities; however, unlike the law currently in force, the new normative act no longer includes any explicit reference to the establishment of trading companies, according to experts in the field. Nonetheless, the draft law clearly states that "within the Service, activities financed entirely from the institution’s own revenues can be carried out". Moreover, the normative act broadens the scope of associations which SRI can operate within.
Government discussed the OUG on establishment of Health Investments Agency
During Wednesday’s meeting, the government discussed the emergency ordinance for the establishment of the Health Investments Agency (ANDIS), which is stipulated in the National Recovery and Resilience Plan (PNRR). The institution will be subordinated to the Ministry of Health and will be in charge of the healthcare infrastructure, including the regional hospitals to be built in Iași, Cluj and Craiova. Even though it is part of PNRR, the establishment of the agency had been initially strongly criticized by the current Health Minister, Alexandru Rafila (from the Social Democratic Party) shortly after taking office.
Government has drawn up a draft OUG to eliminate coal from the national energy system
The Government has drawn up a draft emergency ordinance to eliminate coal from the national energy system, which it committed to in the National Recovery and Resilience Plan (PNRR). The normative act stipulates a ban on the construction of new coal-fired power plants, the end of electrical power generation using lignite and hard coal, and the definitive and irreversible decommissioning and closing, by 31 December 2030, of a total installed lignite- and hard coal-fired power capacity of 4,920 MW.
European News 
Klaus Iohannis says Council will not discuss EU treaty reform anytime soon
There will be no discussions on starting procedures to change the EU treaties during the current EU Council summit or the next one, President Klaus Iohannis said before meeting EU leaders for the summit on Monday and Tuesday. Triggering the change process is an extremely complicated process, Iohannis told journalists in Brussels on Monday (30 May), adding he does not think there is enough political will for a successful attempt.
Unemployment rate in April decreased by 0.1% compared to the previous month, to 5.5%
Unemployment rate decreased by 0.1% in April 2022 compared to the previous month (5.6%). Unemployment rate for the male labor force was 0.3% higher than the one among women, according to data published by the National Institute of Statistics (INS). The number of unemployed (aged 15-74) estimated for April 2022 was 457,900, down from the 460,600 unemployed recorded in the previous month, yet almost similar to the number reported for April 2021 (457,500 people).
56% of Romanian employees would choose to do charity work more often
According to a survey conducted by BestJobs, when employees feel fulfilled, whether professionally or personally, nearly 72% of them look for ways to express their gratitude, while 41% of respondents feel the urge to give something back and get involved in various charity actions and donate or volunteer. However, most respondents say they rarely get involved in charitable activities, and when they do, they choose to donate money or clothes (43%). Employees say it would be easier for them to get involved in charity or volunteering if they saw this example in people close to them (57%), if projects that need help were better communicated (53%) or if their employer organized such actions (37%).