At the end of 2022, analysts expected recession in the euro area and
the United States in 2023, while the current figures show that this is
far from materializing, according to iBanFirst specialists. They have
also indicated that markets, central banks and companies will face
difficulties, especially if the cost of capital continues to rise
sharply.
Romania’s budget deficit reached RON 4.02 billion in the first month of
2023, or 0.25% of GDP, amid 59.8% higher VAT refunds, a slowdown in
revenues from tobacco excise taxes, a higher volume of settlements for
goods and services for medicines, and an increase in the volume of
investments, the Finance Ministry has transmitted. As a comparison, the
budget ended January 2021 with a RON 1.69 billion deficit (0.13% of
GDP).
Romanian entrepreneurs expect economic growth to slow down in 2023, but
will not stop investments in 2023. The main investment priorities in
2023 will be digitalization, improvement of business processes and
employees’ training. Radu Crăciun, a Macro-Economics professor at
ASEBUSS, has stated that developed markets are faced with chronic labor
shortages and there are some countries, including Romania, with large
budget and current account deficits putting pressure on economy.
British financial service Revolut, used in Romania as well, has
reported its first year of profit after six years of successive losses
since its founding by entrepreneurs Nikolay Storonsky and Vlad
Yatsenko. The fintech published its 2021 results with a delay, on
Tuesday, 28 February 2023. The report shows that Revolut, valued at USD
33 billion, made net profit of 26.3 million Sterling pounds in 2021,
after having ended 2020 with net losses of 223.6 million Sterling
pounds. The company’s revenues nearly tripled compared to 2020, having
reached 636.2 million Sterling pounds in 2021.
The National Bank of Romania (NBR)’s foreign exchange reserves stood at
EUR 52 billion at the end of February 2023, EUR 1.8 billion above the
level reported at the end of January 2023, according to NBR data. EUR
3.25 billion inflows were recorded in February, representing changes in
credit institutions’ foreign currency-denominated required reserves
with the NBR, inflows into the Ministry of Finance’s accounts
(including the amounts from the Ministry of Finance’s Eurobond issues
with a total nominal value of EUR 2 billion), inflows into the European
Commission’s account and other.
UniCredit Bank has launched the 2023 edition of the New Home program,
in parallel with a special offer on the standard mortgage loan with
fixed interest rate for the first five years of the crediting period
and with an Annual Effective Rate (AER) starting from 8.15%. The
interest rate for the mortgage loan starts from 6.9%/year in the first
five years, for clients who collect their income into an open account
with UniCredit Bank and have a valid life insurance. Starting from the
sixth year, interest becomes variable, and is formed of IRCC + fixed
margin of 2.1%/year, i.e. reduced AER of 7.81%/year.
Patria Bank, a credit institution owned by investment fund Emerging
Europe Accession Fund, ended 2022 with a RON 20.2 million net profit,
compared to RON 9.4 billion in 2021, and RON 194 million revenues, up
by 18% year-on-year, according to the financial report published on
Bucharest Stock Exchange on Wednesday, 1 March. At the end of last
year, the bank had a RON 2.1 billion portfolio of performing loans, up
by 11% against 2021, and RON 3.4 billion deposits, 4% more than in the
previous year. Newly-grated loans totalled RON 968 million in 2022.
Gross non-performing loans amounted to RON 168 million. Thus, the loans
(gross value)/deposits ratio was 68%.
Lidl, the leader of local food retail, which has a network of around
350 discount stores in Romania, is building its largest local
warehouse, which will spread on eight hectares (80,500 square meters).
The area is almost double the average of other logistics centers
already existing in Romania, according to market data. On average, a
4-5 hectare logistics center costs EUR 20-30 million, so Lidl’s new
investment could reach EUR 40-50 million, according to estimates.
Romanian companies such as Softronic from Craiova and Electroalfa from
Botosani, as well as multinational companies, such as Schaeffler from
Brasov are to invest RON 7.5 million in research for their own
companies, through the state aid scheme for competitiveness, carried
out by the Ministry of Economy. The companies have to come up with half
of the investment and the rest is ensured through grants from the state
budget. So far, financings have been signed for six companies:
Softronic Craiova, Electroalfa Botoșani, Class Tex Satu Mare, Fiterman
Pharma from Iași, Aerostar Bacău and Scheffler Romania.
Finmap, a Ukrainian cash flow management platform dedicated to small
businesses, has secured a new investment round of EUR 1 million from
Polish-American investment fund SMOK Ventures, as lead investor, and a
number of investment funds and private investors, according to a press
release. The cited source also indicates that SMOK Ventures’s
co-founder and general partner Paul Bragiel has invested in more than
400 companies in his career, including UBER, Stripe, Niantic, Unity and
Zappos, and this is the first time the fund has invested in a Ukrainian
project.
The Senate adopted, during the plenary session on Wednesday, with 80
votes "in favor" and two abstentions, the draft law submitted by the
National Liberal Party (PNL), according to which gambling advertising
will only be allowed between 23:00 and 6:00. The draft law bans all
advertising and publicity for gambling, for operators who do not have
an operating license and prohibits any form of audiovisual commercial
communication for gambling activities presented or recommended by
personalities in various fields.
On Wednesday, 1 March, President Klaus Iohannis promulgated the law
amending and supplementing Law 143/2000 on preventing and combating
illicit drug trafficking and consumption and amending Law 194/2011 on
combating operations with products likely to have psychoactive effects,
other than those provided for by existing legislation, the Presidential
Administration has transmitted. According to the normative act, the
growing, supply, sale, distribution, procurement, purchase and
possession of risk drugs are punished with 3 to 10 years in prison.
Development Minister Cseke Attila has announced that the emergency
ordinance approving the "Safe and Healthy Schools" National Investments
Program, which will include all schools classified as seismic risk 1,
was discussed and adopted during the government meeting on Wednesday.
He has added that steps were established to streamline the
implementation of these buildings’ consolidation projects, and the
deadlines for issuing the necessary permits were reduced so that the
actual works can begin as rapidly as possible.
The European Parliament and member states reached an agreement on
Tuesday (28 February) to establish requirements for a European green
bond standard, to prevent financial greenwashing. The EU Commission
first presented the proposal to regulate the use of the term "European
green bond" – or EuGB – for environmentally sustainable bonds in July
2021. The aim of the regulation is to define which financial products
can be labelled as European green bonds. This should help prevent the
greenwashing of financial products – something that has been called out
by both environmental organisations, like Greenpeace, and international
financial institutions, like the International Monetary Fund.
Unemployment benefit and all social benefits related to the Social
Reference Indicator (SRI) will grow starting from 1 March 2023 as a
result of the 13.8% increase in this indicator. The value of the Social
Reference Indicator will thus get from RON 525.5 in 2022 to RON 598
this year. Once the new value of the ISR is applied, the social
allowance (guaranteed minimum income) will rise from RON 149 to RON 170
for a single person, and from RON 554 to 631 RON for a family of five.
There are currently 41,454 vacant jobs available in Romania, while
employers in the European Economic Area (EEA) offer 278 jobs for
Romanian workers, according to data centralized by the National
Employment Agency (ANOFM). Of the 41,454 vacant jobs declared by
employers to employment agencies, 2,405 are for higher education
graduates.