News

Daily Newsletter - 3 July 2020

Summary

FIC (1)

Business community willing to help implement PNIRE

The Coalition for Romania's Development (CDR) hailed the government's National Investment and Economic Recovery Plan (PNIRE) and offered the expertise of more than 300 specialists from the private sector to turn the plan into concrete measures.

CDR supports National Investment Plan

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Macroeconomic News (4)

EC approves EUR 800 million in aid for companies

The European Commission has approved EUR 800 million in aid for Romanian companies affected by the pandemic. The funds will be distributed as subsidized loans to companies with turnovers in excess of RON 20 million, with EximBank managing the entire process. The support program was initially announced in May and was approved this week.

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Industrial inflation down sharply

The industrial production price index dropped almost seven percentage points in the past five months, from 4.72% in January to -2.01% in May, according to the National Statistics Institute (INS). At first glance this looks like good news for the state's efforts to keep prices under control. However, the drop in invoice values will hurt the state budget's revenues.

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Oros announces EUR 43 million in help for young farmers

The young farmer support measure, part of the National Rural Development Program 2014-2020, will be launched on July 15 with a budget of EUR 43 million, including EUR 20 million for diaspora Romanians, according to Agriculture Minister Adrian Oros. Where possible, the state will also lease up to 50 hectares to each farmer.

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ING Bank expects Romanian economy to contract 5.5% this year

"The exceptional impact of the crisis generated by the COVID-19 pandemic will have complex effects on the economy, both in the short term - through the economic contraction that we estimate at -5.5% for 2020 - and also in the medium and long-term, through the modification of consumer behavior under the impact of epidemiological developments, as well as the measures to combat it. In this regard, we expect an increase in the tendency to save," according to Valentin Tataru, Chief-Economist at ING Bank Romania.

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Financial News (4)

BT and Nuclearelectrica met the FTSE Russell liquidity criteria in June

Banca Transilvania (TLV) and Nuclearelectrica (SNN) met FTSE Russell's minimum liquidity criteria in June, ahead of BVB's promotion to the secondary emergent market category in September, according to BT Capital Partners analysts.

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IRCC down slightly

The Consumer Credit Reference Index (IRCC) dropped 0.03 pp on June 1. A more significant drop - 2.16% - will be applied by the banks only in the fourth quarter, although interest rates have been falling since the end of spring.

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Real economy financing cost down

"The National Bank of Romania (BNR) acts to ensure price stability and financial stability, and the exchange rate is perceived by Romanians as an indicator of financial stability, hence the special attention we pay to it. In my opinion, the basic scenario we are considering is the gradual reduction of interest rates, without destabilizing the exchange rate," said BNR's Cristian Popa.

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Raiffeisen Bank approved 1,000 SME Invest loans

Raiffeisen Bank approved 1,000 SME Invest loans, worth RON 500 million. "The SME Invest program means a lot of collective effort and commitment from all those involved: clients, the credit team, but also the authorities. We learned together as applications were initiated, analyzed and promoted, and now we have reached the first 1000 internally approved applications," said Director Raluca Nicolescu.

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Investment News (1)

ANRE to develop supplier change project

The Romanian Energy Regulatory Authority (ANRE) has launched a project to develop its own institutional capacity and streamline the process of changing electricity and gas suppliers. The project is worth RON 19.92 million and is co-financed by the European Social Fund.

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Legislative News (1)

Major changes in regulations for companies

President Iohannis signed the bill eliminating the ban that prevented companies and individuals from being the sole shareholder in several limited liability companies or from associating with a sole shareholder, as well as the ban on having several companies headquartered in the same room.

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Politics (2)

PNL government produced 600,000 unemployed

Marcel Ciolacu, interim leader of the Social Democratic Party (PSD), accused the National Liberal government of having produced 600,000 unemployed in several months and of "destroying everything the PSD built in three years". 628,000 work contracts were terminated in the three months of pandemic.

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President attends Independence Day reception

President Klaus Iohannis stated at the reception hosted by the US Embassy on Thursday that Romania and the US had been able to prove their bilateral solidarity in the context of the COVID-19 pandemic.

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Social (2)

4 out of 10 Romanians spent less

About 46% of the Romanians responding to a survey say they spent less money during the isolation period, above the European average of 44%, according to an international study by ING. 31% of Romanians say that they saved more, slightly above the European average of 30%. Consumers were visibly more concerned with saving after the beginning of the state of emergency. The number of savings accounts opened online has been growing.

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Romania has most car crash victims in EU

Romania had the highest number of car crash victims in the European Union in 2018. With 95.6 victims per 1 million residents, Romania was far above the EU average of 52 per 1 million. While Bulgaria had a high death rate for car passengers (48.4), Romania had a relatively high death rate for pedestrians (35.3) and bike riders (9.3).

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