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.
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.
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 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 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%.
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 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, 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 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.
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.
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.
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.
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.
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.
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 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.
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.
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.