News

Daily Newsletter - 21 May 2020

Summary

Macroeconomic News (4)

State employees payroll accounts for 12.4% of GDP

Romania's state sector employs 1.25 million people, whose combined salaries account for 12.4% of the country's GDP this year, up 1.2 pp from the previous year, according to the European Commission. Romania has one of the biggest state payrolls, calculated as share of the GDP, in the European Union.

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SME Invest applicants - solvent and trustworthy

Almost three out of four companies applying for loans under the SME Invest Romania program have stable financial situations and low to medium risk of going into insolvency. The risk of a company going into insolvency is one of the relevant indicators used by the banks to decide whether or not to grant loans.

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Number of vacant jobs down

"In the first quarter of 2020, the number of job vacancies was 41,800, down 5,300 from to the previous quarter. The vacancy rate was 0.84%, down 0.11 percentage points from the previous quarter. Compared to the corresponding quarter of 2019, the vacancy rate was down 0.34 percentage points, and the number of vacancies decreased by 16,400," according to the National Statistics Institute (INS).

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Romania to receive EUR 3-5 billion from EU

Romania could receive between EUR 3 and 5 billion to support companies and employees affected by the Covid-19 crisis. "This is a program through which the EU helps states to finance active employment measures. Romania has the guarantee that it will benefit from European funding in order to implement the Cabinet's employment measures," said the Prime Minister on Wednesday evening.

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Financial News (3)

UniCredit Bank Romania downgraded

On Tuesday, Fitch Ratings revised UniCredit Bank Romania's rating down, from BBB- to BB+, while Banca Transilvania and Garanti Bank had their outlooks revised from "stable" to "negative", according to an official press release. The long-term ratings of Banca Transilvania, Garanti Bank, BCR and ProCredit Bank were confirmed.

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Corporate borrowing up

The value of new RON- and EUR-denominated corporate loans exceeded RON 10 billion in the first quarter of this year, up 26% on an annual basis. The average interest rate oscillated between 5.5% and 6.1%, according to the National Bank of Romania (BNR).

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Raiffesen Bank approved first 20 SME Invest loans

Raiffeisen Bank has adapted its corporate lending flows to the SME Invest program and approved the first 20 loans under this program, according to a press release. The bank has received so far over 4,500 applications for SME Invest loans and is one of FNGIMM's main partners in this program. The program allows companies to take out loans backed by the state and has a total guarantee budget of RON 15 billion.

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Investment News (1)

EU funding consultant to make own chicken farm

Daniel Stanescu, who runs his own consulting firm that helps Romanian entrepreneurs apply for European Union funds, has decided to set up his own chicken farm. The farm will be located in the Mehedinti county and its estimated production of 240,000 chicken per year will be sold locally.

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Legislative News (1)

Changes to food waste law

Food that is close to the expiry date and is donated will not be considered a delivery of goods, donation contracts will no longer be mandatory, and NGOs specializing in food banks will be included among the recipients of food donations, according to amendments passed by the Senate to the Food Waste Act on Tuesday.

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Politics (2)

Ciolacu replies to Orban: You have forgotten what you signed or you are unaware of what others send in your name

Marcel Ciolacu, interim leader of the Social Democratic Party (PSD), reacted to Prime Minister Orban's statements by saying that "lies are quickly exposed". The PM had said that the Parliament did not have the power to amend the Cabinet decree instituting the state of alert.

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Orban: Parliament had no power to amend Cabinet decree

Prime Minister Ludovic Orban said that, in his opinion, the Parliament did not have the constitutional and legal power to amend the Cabinet decree instituting the state of alert. "This is a gross meddling of the legislative in the executive branch's activity and a flagrant breach of the separation of powers principle," said Orban.

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Social (2)

Romanians are buying more, looking for cheaper products and bigger sizes

The COVID-19 pandemic has left its mark on consumer behavior in everywhere. After sales of consumer goods surged 80% in March, the growth rate fell in April to a similar figure to that of 2019. However, there were a number of changes in the way Romanians shop, according to an analysis by the market research firm Nielsen.

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New national exam rules

Students who take part in preparatory courses, the National Assessment, and the Baccalaureate must keep a distance of 2 meters between them, wear masks and disinfect their hands regularly, according to an order issued by the Minister of Health and the Minister of Education. Schools will provide protection materials and equipment - disinfectant mats, protective masks, hand sanitizers, etc.

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