Daily Newsletter - 3 June 2020


Macroeconomic News (3)

BT: Economy will recover as quickly as it fell

The shock of the pandemic will reset the fundamental data of the Romanian economy, which will grow at an average annual rate of more than 2.5% between 2020 and 2022, as domestic demand returns to the normal levels and net exports improve. The current account deficit will fall from 4.6% in 2019, to an annual average of 2.3% by 2022, according to the monthly report published by Banca Transilvania on Tuesday.


Industrial and logistic space stock to exceed 5 million sqm this year

The total stock of industrial and logistic space in Romania stood at 4.6 million sqm at the end of March and is expected to pass 5 million sqm this year, provided that developers complete all the projects announced by the end of the year, according to real estate consulting firm JLL. So far, the Covid-19 crisis does not seem to have changed the developers' plans.


Orban: We are working on an economic reconstruction plan

Prime Minister Ludovic Orban announced that the Cabinet is working on an economic recovery plan, adding that the guarantee ceiling for the SME Invest program could increase from RON 15 to RON 20 billion. The Cabinet could also set up an investment fund, under state ownership, which would support greenfield investment projects. These measures were first announced a month ago.


Financial News (4)

ING Bank says key rate cut is last one

The National Bank of Romania's (BNR) decision to slash the key interest rate by 25 base points, from 2% to 1.75%, will be the last in this short cycle of falling interest rates, according to an analysis by ING Bank economist Valentin Tataru. The economist added that BNR will be forced to print RON 16.2 billion this year to cover the budget deficit, the equivalent of 1.5% of the GDP.


TBI Bank earnings up 58%

TBI Bank's consolidated earnings reached EUR 22.9 million in 2019, up 58% year-on-year, according to the audited figures published by the bank on Tuesday. The bank's assets jumped 17% to EUR 465 million, while the consolidated loan portfolio surged 19% to EUR 336 million.


Foreign currency reserves up

The foreign currency reserves held by the National Bank of Romania (BNR) stood at EUR 35.64 billion on May 31, up EUR 2.4 billion from the end of April, thanks in part to the EUR 3.3 billion borrowed by the Ministry of Finance (MFP).


NPL rate reached 3.94% at Q1 end

The NPL rate reported by the national banking sector reached 3.94% at the end of March, down from 4.13% in January and 3.98% in February, a far cry from the more than 20% reported five years ago. The banks continued to unload bad loans in the first quarter.


Investment News (2)

Government prepares to condemn properties worth more than RON 42 million

The Ministry of Transport published last week two projects for launching a condemnation campaign targeting properties worth more than RON 42 million in order to build Sectors 4 and 5 of the Sibiu-Pitesti Highway.


Continental to invest EUR 33 million in Timisoara R&D center

Automotive parts manufacturer Continental is boosting its business in Romania and expanding the research and development center located in Timisoara. The group is planning to invest more than EUR 33 million in a new building. The company came close to reducing its operations two months ago, but now it's pushing forward with the research and development investment project. Last summer, Continental launched an investment project worth EUR 27 million at the Iasi engineering center.


Legislative News (2)

ROPEPCA requests urgent stimulus measures for oil industry

The Romanian Petroleum Exploration and Production Companies Association (ROPEPCA) has urged the authorities to take urgent steps to stimulate investment in the national oil industry in order to offset the impact of Covid-19. The organization also complained about the amendments to the Oil Law, passed through Decree 27/2020 in February.


Decree deregulating national healthcare programs ruled unconstitutional

The Constitutional Court of Romania has ruled that the decree deregulating the national healthcare programs is unconstitutional in totality, since it was issued without the advice of the Legislative Council. The decree was drafted by former Health Minister Victor Costache.


Politics (1)

Minister Aurescu, British Ambassador discussed strategic partnership

The Minister of Foreign Affairs, Bogdan Aurescu, had a meeting on Tuesday with the Ambassador of the United Kingdom of Great Britain and Northern Ireland to Romania, Andrew Noble. The Romanian side stated its "firm desire to launch and implement as soon as possible the new bilateral Strategic Partnership, revised and adapted to the new European realities".


Social (1)

Proposal to hold second Baccalaureate session

The Minister of Health, Nelu Tataru, announced that the Cabinet is considering holding a second Baccalaureate session on July 6, two weeks after the first. PM Orban has agreed with this proposal as a way of helping students who cannot attend the first session for medical reasons.