Daily Newsletter - 20 September 2022


Macroeconomic (3)
Financial (4)
Investment (3)
Legislative (4)
European News (1)
Social (3)
The risk of a euro-area recession has reached its highest level since July 2020
The risk of a euro-area recession has reached its highest level since July 2020 as concerns grow that a winter energy squeeze will cause a slump in economic activity, Bloomberg reports. Economists polled by Bloomberg now put the probability of two straight quarters of contraction at 80% in the next 12 months, up from 60% in a previous survey. Germany, the bloc’s largest economy and among the most exposed to cutbacks in gas supplies, is likely to shrink from as early as this quarter.
European Central Bank could raise interest rates even into 2023
The European Central Bank (ECB) could raise interest rates even into 2023, causing problems for consumers as it is trying to dampen demand that contributes considerably to the rising inflation, according to the financial institution’s chief economist Philip Lane. With inflation nearing the double-digit territory, the ECB increased interest rates significantly in July and September and promised more action as even long-term price growth expectations are now moving above its 2% target.
47% of Romanians have cut their spending in the past year due to rising prices
Romanians have adapted their financial behaviour amid the rising inflation, prices and utility tariffs in recent months, almost half of them (47%) having reduced their spending, according to the Money Matters 2022 study conducted by Erste Group. On average, Romanians save RON 351 per month, RON 42 more than in 2021. However, only 33% put money aside for old age. More than half of them, 64%, say they have been affected by inflation, and 38% believe their financial situation has deteriorated in the past year, double the percentage from 2019.
Allianz-Tiriac reached RON 1.6 billion underwritten premiums in H1/2022
Allianz-Tiriac reached RON 1.6 billion underwritten premiums at the end of the first six months of 2022, double the volume recorded in the similar period of 2021, according to information provided by company representatives. Allianz-Tiriac paid over RON 526 million compensations in H1/2022, up by 50% year-on-year. The value of compensations grew across all types of insurance.
Ministry of Finance borrowed RON 132 million from banks on Monday, 19 September
Ministry of Finance borrowed RON 132 million from banks on Monday, 19 September 2022, below the planned level, through an auction of government bonds with a nominal value of RON 300 million, maturing in 2029, at an interest rate of 8.19% per year. Seven primary dealers participated in the auction. Total demand stood at RON 240 million, of which banks bid the entire amount on their own behalf. The coupon rate was 4.85% and the yield to maturity on the auction price was 8.19%.
Foreign capital outflows from Romanian banking sector totaled EUR 17 billion in 2009–2021
The Romanian banking sector recorded major capital outflows after the global financial crisis that started in 2008, totaling EUR 17 billion between 2009 and 2021, down by 70%, from EUR 24 billion capital in 2009 to a minimum of EUR 7 billion in February 2021. This data was presented by Florin Georgescu, First Deputy Governor of the National Bank of Romania (NBR), during the Bucharest Security Conference 2022.
CEC Bank allows contactless cash withdrawals at more than 550 ATMs in its network
CEC Bank has announced that it has implemented contactless cash withdrawals at more than 550 ATMs and multi-functional payment machines in its network, allowing customers to withdraw money from the card directly using their smartphone, smartwatch or other contactless devices. Contactless features are available both for CEC Bank clients and for users of cards issued by other banks that allow contactless transactions at ATMs other than those in their own network.
Satu Mare International Airport to invest RON 433 million for modernization works
Satu Mare International Airport, subordinated to Satu Mare County Council, will invest RON 433 million (EUR 87.5 million), from European funds (European Regional Development Fund) and supplemented by allocations from the state budget and from Satu Mare County’s local budget, for various modernization works. Of the total RON 433 million, RON 365 million (EUR 73.7 million) will be used to build a new terminal and extend the existing terminal, rehabilitate the runway, extend the boarding platform, and to purchase equipment for airport activities in winter.
OMV Petrom installed photovoltaic panels in 110 OMV and Petrom gas stations
OMV Petrom has installed photovoltaic panels in 110 OMV and Petrom gas stations in Romania, as part of an investment program to have amounted to EUR 3 million so far and aims to reach 150 units by the end of the year, i.e. 30% of the network. The estimated annual production will be 2,700 MWh, which is equivalent to the energy needed annually for 1,500 apartments. OMV Petrom aims to achieve carbon neutrality for its operations by 2050 and contribute to its customers’ decarbonization process.
Economy Ministry to open session for investment projects for manufacturing sector
The Ministry of Economy has announced that it will open the session for submitting investment projects for the manufacturing industry on 1 November, the state aid amounting to EUR 300 million for 2022 and 2023. Companies operating in this industry will be able to submit investment financing requests during the period 1 November 2022 - 16 December 2022. The development of the manufacturing industry through the state aid scheme financed by the Ministry of Economy will maintain jobs in this sector and will create new ones in less developed areas. Moreover, green investments are also encouraged, which is one of the eligibility criteria.
USR calls for postponing debates on Justice Laws
Amid the Council of Europe’s request that Romania should amend its justice laws in line with Venice Commission’s opinion, Save Romania Union (USR) submitted a request to the Standing Bureau of the Chamber of Deputies on Monday, 19 September, to extend the report deadline for the three laws proposed by Minister Predoiu until Venice Commission’s opinion is received. Venice Commission was asked to issue an opinion on the three draft justice laws on 14 September 2022.
Draft law adopted by the Senate proposes amending the Traffic Code
A draft law adopted by the Senate proposes amending the Traffic Code so that local police officers can impose fines for a new offence, which has been under the jurisdiction of the Traffic Police so far. It refers to the car owner’s obligation to report to authorities the identification data of the person driving the car, if they are not the owner. As it is a matter of ensuring traffic flow on public roads, local police officers will be able to ask for car drivers’ data in case of illegally parked or stopped cars.
USR has submitted a new amendment to Emergency Ordinance on Energy
Save Romania Union (USR) has submitted a new amendment to the Government Emergency Ordinance (OUG) on Energy to correct the discriminatory and totally erroneous way in which the PSD-PNL Government has established the implementation of the capping scheme. USR has also proposed that the capping scheme should apply based on the current monthly consumption, not on the consumption from 2021. USR’s amendment thus eliminates discrimination against Romanians who cannot go back in time to consume less energy in order to benefit from the cap.
Deputy Ionel Dancă calls for amendments to Ordinance 119/2022
On Monday, 19 September, the vice-president of the Force of the Right Wing Party, unaffiliated deputy Ionel Dancă called for an emergency meeting of the Senate’s reporting committees to debate and amend Ordinance 119/2022 on energy prices. He added that the MPs from the Force of the Right Wing supported the removal of the article stating that the capping of electricity and natural gas prices depended on the consumption recorded in 2021.
European News 
Emergency EU measures to reduce energy prices risk creating inequality in Europe
Emergency EU measures presented last week to alleviate the burden of high energy prices on consumers risk creating a patchwork of different interventions across Europe and depressing investments in renewable energies, industry sources have warned. The European Commission proposed two measures to redistribute the extraordinary revenues some energy companies have made due to the impact of soaring gas prices on the energy market. But the implementation of those measures, which is left to national governments, is causing concern that industrial and household consumers will benefit differently depending on which country they are located in.
Unemployment rate started decreasing in Q2/2022
Unemployment rate reached 5.3% in Q2/2022, down by 0.7% against the previous quarter, according to data from the National Institute of Statistics (INS). The decrease in unemployment rate in Q2 of 2022 comes after three consecutive quarters of growth. Unemployment rate grew by 0.2% in Q3/2021 quarter-on-quarter. The increase recorded in the last quarter of 2021 was 0.6% compared to the previous three months, and the unemployment rate was up 0.1% in the first three months of 2022, against Q4/2021.
PNL wants social vouchers to be granted in 2023 as well
Nicolae Ciucă, president of the National Liberal Party (PNL), has announced that he will propose in the ruling coalition that the EUR 50 social vouchers measure should be extended to 2023. The announcement regarding the social vouchers granted every two months came after a meeting of the Liberal leadership’s Executive Bureau. During the meeting also, the PNL leader spoke about the importance of European money for Romania, and the increase in the absorption rate.
Gabriel Firea announces that Consultative Councils will be set up at local level
Minister for Family, Youth and Equal Opportunities, Gabriel Firea, stated that Consultative Councils would be set up in localities to gather information about children with social problems so that the ministry can subsequently allocate funds for those problems to be solved. Gabriela Firea said in Iasi, during a debate on school dropout prevention, that Romania would have, for the first time, a database that would not only include children who can be adopted, but also those at risk of dropping out of school.