Daily Newsletter - 3 February 2020


FIC (1)

Foreign direct investment has a positive impact on Romanian exports

Foreign direct investment has a positive impact on Romanian exports, according to a study conducted by EBRD at the end of 2019. According to the BNR data, the total volume of foreign investments was EUR 81.1 billion, at the end of 2018. At the Foreign Investors Summit organized by "Business Review", the president of the Foreign Investors Council (FIC), Ramona Jurubita, said that steps must be taken to convince foreign investors to remain in Romania, starting with the harmonization of the private sector with the public one, as well as the academic one.


Macroeconomic News (3)

Insolvencies drop to all-time low

Romania is nearing the end of the post-crisis growth cycle, according to the latest data received from the Trade Register. The number of insolvencies dropped last year to an all-time low of 6,500, down 27% from 2018 and down 67% compared to 2009. Also, the number of active economic entities (companies and self-employed) surged to a record 1.36 million in 2019.


Urgently needed measures

The Association for Privately Administered Pensions in Romania (APAPR) announced a cumulative return for second pillar contributions of 154% (in nominal terms) since 2008, while the GDP has increased by 102% (also in nominal terms) over the same period, according to the current forecast.


Romania pays more for debt than Bulgaria

Even though the interest rates of state bonds dropped by around 30 base points in January, Romania pays the highest debt costs of any country in the region. The Ministry of Finance wants to borrow more than RON 5 billion from the banks this month, coming on the heels of more than RON 6 billion in January loans.


Financial News (3)

Central banks stumped by lack of inflation

The problem of the big central banks is that even though they are printing money non-stop, and the markets are awash with liquidity, the inflation rate refuses to increase, while economic activity is very weak, although the financing costs are almost equal to 0. The independence or autonomy of the central banks follows a cycle of strengthening or of weakening during the various historical periods, and one of the determinants of the trends in this plan is the tendency for inflation of economic policy makers, said in a symposium Mugur Isarescu, Governor of the National Bank of Romania (BNR).


BT loses debt relief lawsuit

After the Turda Court rejected Banca Transilvania's challenge to a notification sent by a debtor who turned in the keys, the ruling was overturned by the Cluj Specialized Court, according to the CREDERE association. The debtor appealed the decision and the Cluj Court of Appeals issued a final ruling in the debtor's favor.


BNR approves new EximBank, BR teams

The National Bank of Romania (BNR) approved the lists of executives submitted by EximBank and Banca Romaneasca, two lenders undergoing a merger in the wake of the transaction inked in mid-2019. If the Ministry of Finance, the majority shareholder of EximBank, wanted the merger to take a different course, it would have to resort to amending the bank's charter and selling some of BR's assets to CEC Bank.


Politics (2)

Orban: Romania is kept prisoner by various red barons and baronets

Prime Minister Ludovic Orban told the National Liberal Party's (PNL) National Council that "Romania is kept prisoner by various red barons and baronets who think the institutions had been invented to benefit them". Orban added that things must change.


Orban: Motion of censure has no chance

Prime Minister Ludovic Orban stated once again that the motion of censure "has no chance of passing". The PM added that he had not discussed with President Iohannis a possible resignation in order to trigger early elections, although he sees early elections as "the best solution for Romania".


Social (2)

89 new measles cases reported in last week

89 new measles cases were reported in the past week, pushing the total number of cases to 19,259, including 64 deaths, according to the National Supervisory and Control Center for Transmissible Diseases (CNSCBT).


Romanian employees faced highest poverty risk in EU in 2018

While Romania has made progress in reducing the poverty risk among the employed population, the country remained at the top of the EU index with a 15.3% poverty risk. The European Union average is 9.5%, according to data released by Eurostat on Friday.