News

Daily Newsletter - 4 December 2018

Summary

Macroeconomic News (3)

FGCR announced fee reduction

The Rural Credit Guarantee Fund IFN SA (FGCR) will reduce the value of the single guarantee fee from 3.8% to 1.6%, the beginning of next year, a move that could benefit about 10,000 companies operating in agriculture, animal husbandry and aquaculture, according to a press release from the Ministry of Agriculture and Rural Development (MADR).

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Governor Isarescu is optimistic

"The economy is growing. Judging by what they say on TV, everything should collapse in this country. The economy does not want - it does not want to collapse at all. It keeps going forward," said Mugur Isarescu, Governor of the National Bank of Romania (BNR), at the "Inflation in the last 10 years" conference on Monday. However, the Governor noted that Romania has competitiveness problems when compared to the Czech Republic, Poland and Hungary. The fact that these problems extend to agricultural products is worrying.

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Budget revenues at all-time low

Romania ranked in the penultimate spot among EU member states in 2017 regarding the GDP share of budget revenues, according to Eurostat data. With only 25.8%, Romania had a bigger share than Ireland (23.5%), but Ireland's GDP is being expanded by multinational companies moving their headquarters there in anticipation of Brexit.

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Financial News (4)

Banks reject unpredictability in debtor relief

The banks are challenging the amendments to the debtor relief regulations, which redefine the conditions under which judges will assess the unpredictability of debtor circumstances. The banks described the amendments as unconstitutional, discriminatory and drafted without an impact study, while also rejecting the expansion of debtor relief to the Prima Casa program, warning that it would affect the country's rating, according to an official document sent to the Parliament, the National Bank of Romania (BNR) and the Ministry of Finance by the Romanian Banking Association (ARB) and the CPBR.

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MFP borrowed RON 494 million

The Ministry of Finance (MFP) borrowed RON 494 million from the commercial banks yesterday, through an issue of 89-month bonds bearing an average yield of 4.67% per year. The issue's nominal value was RON 400 million and the banks offered a total of RON 821 million.

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CSALB boasts of advantages to clients

Officials from litigation resolution firm CSALB said clients who choose their services have at least three advantages over going to court: faster resolution time, win-win negotiations and zero costs. Last year, CSALB received more than 1,000 applications, most of them from debtors who had taken out CHF-denominated loans.

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Housing prices to stagnate in 2019

An analysis conducted by RE/MAX Romania and Imobiliare.ro showed that housing prices will stagnate next year, as the Prima Casa program's budget is expected to fall 25%, while the three-month ROBOR rate will not pass 3.5%.

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Investment News (2)

CNAIR signs first contracts for Craiova-Pitesti expressway

The National Company for Road Infrastructure Administration (CNAIR) announced on Monday that General Manager Narcis Neaga had signed the first three contracts for the planning and execution of three sectors of the Craiova - Pitesti express road. The three contracts are worth RON 1.812 billion (EUR 389 million), VAT not included, and the three expressway sectors amount to 57.55 kilometers.

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Energy sector needs EUR 22 billion worth of investments over next ten years

The Integrated National Plan for Energy and Climate Change (PNIESC), which Romania will send to Brussels, features investments worth EUR 22 billion in power plants and grids over the next decade, provided the measures included in the Plan will also be adopted. Of the EUR 22 billion, EUR 9 billion will go to grid construction and expansion, EUR 12 billion to power plants and EUR 1 billion to steam boilers, according to the scenario modeled by the plan.

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Legislative News (1)

Architectural tax repealed by Senate

The Senate allowed to pass into law a bill repealing Law 35/1994 that made the architecture tax mandatory. The tax is 0.5 per thousand of the total investment, regardless of beneficiary or purpose. The tacit passing note for this project, which was scheduled to be debated and voted on November 28, was read in the plenary session by PSD Senator Claudia Manda.

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Politics (2)

PM Dancila at Zagreb summit

Prime Minister Viorica Dancila attended the Zagreb Summit of Heads of Government representing the members of the Central European Initiative (CEI) on Monday. The PM announced that Romania is pushing ahead with the last preparations for the first Romanian Presidency of the EU Council, informs a government press release.

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PSD-ALDE coalition loses Chamber majority

Deputies Ion Spanu, Mihai Valentin Popa, Ion Mocioalca and Mihai Monaci announced yesterday that they had left the Social Democratic Party (PSD) and joined Victor Ponta's PRO Romania. The PSD caucus has only 144 deputies now, while ALDE has 19, their combined 163 deputies being slightly below the 165 majority needed to pass organic laws.

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Social (1)

More than 500 disabled individuals hired at BLM

More than 500 people with disabilities were selected for employment through the Labor Fair (BLM), organized at national level on December 3, the International Day of Disabled Persons, according to the Ministry of Labor. Employers offered 2,792 jobs during the national event, of which 2,411 for people with disabilities.

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