Daily Newsletter - 29 June 2022


Macroeconomic (4)
Financial (3)
Investment (3)
Legislative (2)
European News (1)
Social (2)
Banca Transilvania estimates that Romanian economy will grow by 3.8% in 2022
Banca Transilvania, the biggest bank on the local market asset-wise, estimates that Romanian economy will grow by 3.8% in 2022 compared to Ciucă government’s 2.9% forecast and that GDP will reach EUR 277 billion, compared to EUR 240 billion in 2021. In 2023, GDP is expected to reach EUR 306 billion. For private consumption, the main component of GDP, Banca Transilvania forecasts a 4.7% advance this year and a 5.2% increase in 2023, while investments will only grow by 3.2%. Moreover, average inflation will be 10.5%, up from 4.1% in 2021, and the National Bank of Romania (NBR) will raise the monetary policy interest rate to 4.5%, from 3.75% at present.
European Central Bank must act to combat the record inflation in the euro area
ECB President Christine Lagarde wants the European Central Bank to act "in a determined and sustained manner" to combat the record inflation in the euro area, especially if there are signs of a sharp rise in price-related expectations among consumers and businesses. The ECB plans to start raising rates in July for the first time since 2011, and on Tuesday, Christine Lagarde maintained the plan to start with a 0.25% increase before making a bigger move in September, unless there is a rapid improvement in the inflation outlook. Moreover, the bank will stop bond purchases starting from Friday, in response to the record annual euro area inflation, of 8.1% in May, four times higher than ECB’s 2% target.
State budget revenues grew by 22% in the first five months of 2022
State budget revenues grew by 22% in the first five months of 2022, compared to the same period of 2021. The advance is very good, given that a 13% increase in revenues had been estimated for 2022. Ionuț Dumitru, a chief economist at Raiffeisen Bank, has stated that VAT revenues have had a good evolution in 2022, but the dynamic of social contributions and salary taxes is not so great and is below the wage bill in economy.
Ministry of Finance continues to finance business sector in Romania
The Ministry of Finance has drawn up the normative act regulating the SME INVEST PLUS Program, which facilitates access to financing for companies facing a liquidity shortage, necessary to carry out investment projects and to continue their activity. Financing can be accessed until 31 December 2022 and interests will be paid within maximum 13 months from the date when each loan is granted. The program will be implemented in the form of a state aid scheme under which guarantees and grants will be provided to cover part of the financing costs of the contracted loans.
Bank interest rates will grow, given the upward trend of both ROBOR and IRCC
Bank interest rates will grow, given the upward trend of both ROBOR and IRCC, the benchmark index used for consumer loans, Adina Călin, Product Manager at CEC Bank, stated during the ZF Invest in Romania Conference, organized in Constanta. She also pointed out, among other things, that the monetary policy interest rate was 5.25% in Poland, 5.75% in the Czech Republic and 5.40% in Hungary.
MaxyGo Credit has obtained the operating permit from NBR and will start granting loans
MaxyGo Credit IFN has obtained the operating permit from the National Bank of Romania (NBR) and will start granting the first loans in mid-July, Alexandru Apostol, general manager and shareholder of MaxyGo Broker, a Top 20 player, told The company is controlled by Romanian holding MaxyGo Invest, with a 96% stake, along with Alexandru Apostol - 1.68%, Luciana Apostol - 1.68%, Laura Marinela Niță - 0.32% and Carmen Silva Stanciu - 0.32%.
BRD and Social Innovation Solutions to organize Climate Change Summit on 4-5 October 2022
BRD Groupe Societe Generale, as initiator and founding partner, and Social Innovation Solutions, an organization active in sustainability, social impact and innovation, are to organize the Climate Change Summit on 4-5 October 2022, at the Odeon Theatre in Bucharest and several related events at the Palace of Parliament and Victoria Palace. The event is the first summit in Romania dedicated to climate change and aims to be an annual reference forum for national and European leaders in the sector, to identify solutions applicable at local and regional level in the field of climate policies and sustainability. The transition to a green economy, sustainable financing and investments, sustainable solutions in energy, agriculture and the food industry or how technologies such as AI or Blockchain can become tools to combat the effects of climate change are some the most important topics on the agenda of the first edition of the Summit.
Stihl plans to build a production unit following a EUR 125 million investment
Andreas STIHL Power Tools SRL, a subsidiary of Andreas STIHL AG&Co. KG holding from Germany, plans to build a new production unit in the Eurobusiness I Industrial Park, located on Borșului Street in Oradea, worth EUR 125 million, on a land area of about 147,000 square meters. This investment will be carried out in stages and is the result of direct negotiations, representing the most important investment since the establishment of Agenţia de Dezvoltare Locală Oradea S.A. up to present.
First bridge built on national roads in Buzău County after 1989 was inaugurated on Tuesday
The first bridge built on national roads in Buzău County after the 1989 Revolution was inaugurated on Tuesday, 28 June, on DN 10 National Road, at Cislău, over the Bâsca Chiojdului River, after 19 months of works. The bridge is 140 meters long, with three spans of 40-60-40 meters, and is the only bridge in Buzău and among the few in the country with a 60-meter span. The new bridge required a RON 17,140,000 investment, VAT not included, and works started on 10 October 2020.
Nearly 50% of companies will invest more than a third of their technology budgets in AI
Regardless of industry, the impact of Artificial Intelligence on companies is growing and accelerating. The biggest companies in the world that discussed artificial intelligence (AI) during their financial results conferences in 2021 were 40% more likely to see an increase in share prices - up from 23% in 2018. In addition, investments in AI is growing. In 2021, 19% of analyzed companies used more than 30% of their technology budgets for AI projects. The percentage of organizations investing more than 30% of their technology budgets in AI will grow to 49% by 2024.
President Klaus Iohannis has promulgated a new law
The Presidential Administration has announced that on Tuesday, 28 June, President Klaus Iohannis promulgated the law completing Law 134/2010 on the Civil Procedure Code. The normative act amends this law by introducing a provision on the communication of court decisions, ex officio, by electronic mail. Moreover, "court rulings shall be deemed as communicated upon receiving a message from the used system saying that they have reached the addressee, according to data provided by the latter".
Iohannis promulgated law amending Art. 23, paragraph (2) of Government Ordinance 137/2000
On Tuesday, President Klaus Iohannis promulgated the law on the prevention and sanctioning of all forms of discrimination, according to the Presidential Administration. The normative act amends Article 23, paragraph (2) of Government Ordinance 137/2000, by establishing the norm according to which one of the members of the National Council for Combating Discrimination must be a representative of the parliamentary group of national minorities.
European News 
Romania delays 5G auction due to lack of legislation
Romania cannot launch procedures to auction off the 5G frequencies until the Communications Code gets the green light, Digital Minister Sebastian Burduja has said. The auction for the 5G spectrum represents one of the targets that needs to be completed by 30 June, according to the country’s recovery and resilience plan. But Burduja said the auctions cannot be launched as the Communications Code was contested by the Constitutional Court, and parliament needs to re-approve the law, to make the necessary corrections. The legislation is now in parliament, but the authorities want to wait to be sure no other complaint is filed to the Constitutional Court.
69.8% of Romanians believe that things in Romania are going in the wrong direction
69.8% of Romanians believe that things in Romania are going in the wrong direction and only 24.3% think that things are going in the right direction, according to an Inscop survey. When asked what they thought about the overall situation in Romania compared to 30 years ago, 54% of respondents said it was worse, 35.6% said it was better, 8.5% said it was the same and 1.9% did not answer. The Inscop survey also introduces, for the first time, the administrative-territorial reform theme, an issue abandoned by the ruling coalition.
CFA Romania Association published the study on population ageing
On Tuesday, 28 June, CFA Romania Association published the study on population ageing and the economic consequences of this phenomenon, considering that population ageing is an important issue on Romania’s public policy agenda and cannot be delayed. According to the study, Romania is an exporter of labour and social balance in the European Union. Studies show that, in the context of an open market, certain imbalances on developed markets are covered by imported labour. Romanians who have emigrated contribute both to covering labour needs in areas with deficits and to balancing the social system and the social contract in EU countries.