Daily Newsletter - 5 September 2019


Macroeconomic News (3)

CNIPMMR says Cabinet should have 15 ministries

The National Council of Private Small and Medium-sized Enterprises (CNIPMMR) has put forward a proposal to reduce the number of cabinet positions from 24 to 15, similar to the cabinets of Germany and Netherlands.


Goldman Sachs sees euro at RON 5 in 12 months

The RON/EUR reference exchange rate will climb toward RON 4.8 per EUR at the end of this year, before reaching RON 5 per EUR in the next 12 months, according to Goldman Sachs analysts. The deterioration of economic fundamentals, such as the worsening current account deficit, fiscal risks, political turmoil and rising salaries, could force the National Bank of Romania (BNR) to allow a faster depreciation of the national currency.


Retail sector surged 7.5% in July

Retail sales jumped 7.5% in Romania in July, compared to the corresponding month of 2018, according to data released by Eurostat on Wednesday. This was the highest growth rate in the European Union. By comparison, the average growth rate in the eurozone was 2.2%.


Financial News (2)

Cost of consumer and corporate loans down in July

Housing loans became more expensive in July, following the updating of the new reference interest rate (IRCC). On the other hand, the cost of consumer loans continued to fall. Corporate loans saw their interest rates drop to a 12-month low. The banks increased the average interest rates they pay on deposits to a 4-year high.


Hidroelectrica IPO next September is optimistic

September, 2020, would be an optimistic deadline for listing Hidroelectrica on the Bucharest Stock Exchange (BVB), according to John Meyer, manager of the Proprietatea Fund. Meyer said the recent government "turmoil" does not help the process.


Investment News (2)

CC approves CMU acquisition of Materna Care

The Competition Council announced on Wednesday that it had authorized the acquisition of Materna Care by the Centrul Medical Unirea. The transaction means that Materna Invest and Premiere Care have also come under CMU's control.


FP manager says investing in new reactors nonsensical

Investing in the third and fourth reactors of the Cernavoda nuclear power plant cannot be justified from the financial point of view, but the issue is extremely sensitive, according to Johan Meyer, CEO of Franklin Templeton Investments and manager of the Proprietatea Fund. Meyer added that Reactor 1 would have to be modernized at some point.


Legislative News (2)

MFP working on state aid program

The Ministry of Finance (MFP) is working on a state aid program for the construction sector, which would observe the European Union's rules on tax incentives for this sector. The program is expected to be ready in a couple of weeks.


Minister of Finance files bills

The Minister of Finance, Eugen Teodorovici, has filed 10 bills with the Parliament. The bills focus on a range of measures, such as taxing pensions above RON 7,000, overhauling the "Prima Casa" program, taxing tips, and other changes to the Fiscal Code.


Politics (2)

President Iohannis: Romanians want a different government

President Klaus Iohannis issued a new public statement saying the Social Democrats (PSD) must be removed from power. "The state must be reset because the direction in which the PSD has taken the country is absolutely wrong," said the president.


Senate to elect new president on Tuesday

The new president of the Senate will be elected next Tuesday, according to the Standing Bureau. On Monday, the senators will be working with their constituencies, attending the beginning of the academic year. So far, three senators were nominated for the position: Teodor Melescanu (ALDE, but backed by the PSD), Ion Popa (ALDE) and Alina Gorghiu (PNL).


Social (1)

Romania has lowest healthcare spending in EU

Romania ranks last in the European Union based on healthcare spending as percentage of the GDP, according to Eurostat. At only 5%, Romania is almost 50% of the EU average and far below France (11.5%), Germany (11.1%) and Sweden (11%).