Daily Newsletter - 26 May 2022


Macroeconomic (3)
Financial (3)
Investment (3)
Legislative (2)
European News (1)
Social (2)
Four-month budget execution shows deficit-to-GDP ratio falling to 1.23%
The execution of the general consolidated budget in the first four months of 2022 ended with a RON 16.33 billion deficit, down from the RON 20.70 billion deficit recorded in the same period of 2021. Expressed as a percentage of GDP, the budget deficit decrease by 0.5% in the first four months of 2022 year-on-year, from 1.75% of GDP to 1.23% of GDP.
An IMF delegation will visit Romania at the beginning of June
An International Monetary Fund (IMF) team led by Mr Jan Kees Martijn will come on an official visit to Bucharest during the period 30 May - 10 June 2022, for its regular meeting with the Romanian authorities (known as the Article IV Consultation), the Fund indicated in a message transmitted on Wednesday. The IMF team will discuss economic developments and policies with officials from the Ministry of Finance, the National Bank of Romania, government agencies, as well as representatives from the private and non-governmental sectors.
Economic activity accelerated in the first half of Q2/2022
Economic activity accelerated in the first half of Q2/2022, compared to the first quarter of the year, when 5.2% quarterly GDP growth had been recorded, BCR analysts indicate in a research note. They point out that economic growth could reach 5% in 2022. Romania’s economy (GDP) accelerated considerably in Q1 of 2022, above expectations, after the pandemic restrictions had been lifted in February. The annual advance significantly exceeded estimates, having stood at 6.5%, compared with a 2.4% annual growth rate recorded at the end of the fourth quarter.
OTP Bank Romania launches a campaign offering interest rates of up to 5.30% until 18 July
OTP Bank Romania has launched the campaign "<<Fresh Cash>> 6 and 12-month RON-denominated term deposits", within which clients can obtain an interest rate of up to 5.30% per year for the 12-month term deposit, with zero opening, liquidation and withdrawal fees. The last benefit applies to cash withdrawals from term deposits at maturity, according to the data transmitted by the banking institution’s representatives on Wednesday.
BRD has presented the main points of its Horizons 2025 action plan
Francois Bloch, the CEO of BRD Groupe Societe Generale, has transmitted that the Horizons 2025 plan approaches BRD’s future from three main perspectives: customer satisfaction and digitalization, transaction towards sustainability and business line efficiency. This strategy involves putting into practice the bank’s vision to strengthen its long-term relationship with customers, both individuals and businesses, by offering enhanced personalization and an omni-channel journey. Through Horizons 2025, BRD aims to strengthen its position on the Romanian market, to be a leader in the energy transaction towards sustainability and to provide more support to the Romanian economy and society.
Raiffeisen Bank has published its first Report on the green bonds issued in 2021
Raiffeisen Bank has published its first Report on the green bonds issued in 2021 and the Sustainable Bonds Framework, through which the bank will allocate funds attracted through sustainable, green or social bond issues to sustainable projects aligned with its sustainability strategy - green buildings, renewable energy, energy efficiency projects, green transport and agriculture, pollution prevention and control projects, circular economy, sustainable management of water resources, but also social projects - access to essential healthcare, education and infrastructure services, affordable housing and financing for small and medium-sized enterprises in underdeveloped regions of the country. In 2021, for the first time on the Romanian capital market, Raiffeisen Bank had successfully placed the first two RON-denominated green bond issues ever listed on Bucharest Stock Exchange.
Dogariu family will invest about EUR 10 million in a new accommodation unit
The Dogariu family, who owns the Mercure hotel in Piaţa Romană area of Bucharest and Ibis Styles hotel, located in Bucharest as well, will invest about EUR 10 million in a new accommodation unit, this time in Alba Iulia. This project will also be affiliated to the Mercure brand and will have 112 rooms and apartments on three floors plus an attic. This will be the first hotel affiliated to an international brand in the city of Alba Iulia, located in the center of the country.
Casa de Vinuri Vrânceană invests in bottled wine production
Casa de Vinuri Vrânceană, a bulk wine producer from Dalhăuți locality, Vrancea County, owned by Ion Horhocea and Andrei Bărbieru, grandfather and grandson, is to invest several tens of thousands of euros in winemaking equipment and machinery. The company wants to switch to bottled wine production and increase its capacity 3.5 times, to 140,000 liters of wine per year, according to its representatives.
Samsung SDI and Stellantis to invest more than USD 2.5 billion in a new battery plant
Samsung SDI, South Korean group Samsung’s batteries division, and automotive manufacturer Stellantis announced on Tuesday they would invest more than USD 2.5 billion in a new joint venture plant to manufacture batteries for electric vehicles in Indiana, USA, amid the growing demand. The plant is expected to become operational in 2025 and will have an initial production capacity of 23 GWh, with a target of 33 GWh in the following years. Investments would gradually increase to USD 3.1 billion at the plant in Kokomo, Indiana, where 1,400 jobs would be created.
President Klaus Iohannis has promulgated the offshore law
President Klaus Iohannis has promulgated the normative act amending and completing Law no. 256/2018 regarding certain measures necessary for the implementation of oil operations by holders of oil agreements related to offshore oil perimeters, the Presidential Administration has announced. The law was adopted by the Chamber of Deputies, as the decision-making body, last week. The law regulates a set of measures on the stability of the oil tax and royalty regime.
Government has approved 55%-85% bonuses for staff in healthcare units
According to a press release issued by the Ministry of Health, the occupational category of public sector positions "Health and Social Care" will benefit from a bonus for particularly hazardous working conditions (of 55%-85%) for staff directly involved in the transport and collection of biological samples, as well as in the rapid testing, assessment, diagnosis and treatment of suspected and confirmed COVID-19 patients during epidemiological and biological risk situations. This normative act aims to establish public health measures in high-risk situations, with subsequent amendments and additions, according to the Ministry of Health.
European News 
Romanian air force resumes flights with MiG-21 LanceR following incidents
Romania’s air force resumed operations with the MiG-21 LanceR fighter jets, which were grounded almost six weeks ago following multiple incidents involving this aircraft. Flights with the MiG-21 LanceR resumed Monday (23 May) and will continue for almost one year, the Defense Ministry has said. Romanian pilots will fly the MiG-21s only for air police missions and continue their training, and the air force will remove this aircraft from its fleet on 15 May 2023. The defense ministry also said it took measures to speed up the acquisition of 32 used F-16s from Norway to add to the 17 second-hand F-16 jets already part of its fleet. Meanwhile, the air force will commence procedures to acquire fifth-generation fighter jets, the ministry added.
40% of Romanian employees plan to ask for a pay rise within the next year
The global "great resignation" phenomenon will continue next year with even more pressure on wage growth. 40% of employees in Romania plan to ask for a pay rise within the next year and 16% want to change employers, according to the results for Romania of the Workforce Hopes and Fears global survey conducted by PwC and published on 24 May, at the World Economic Forum in Davos.
Romania has the highest number of early school leavers in the EU
Romania ranks first in terms of percentage of people who dropped out of school in 2021, with 15%, while Croatia has the lowest percentage, of 2%, according to Stockwatch, cited by Rador. Romania is followed by Spain and Italy (both with 13%), as well as by Bulgaria, Hungary and Germany with 12% each. The countries with the lowest percentages in 2021 include Slovenia, Greece and Ireland (3%), Lithuania and the Netherlands (5%). According to Eurostat, the percentage of early school leavers was lower among young women than among young men in all EU member states, except for Bulgaria and Romania, in 2021.