Daily Newsletter - 7 January 2022


Macroeconomic (4)
Financial (2)
Investment (3)
Legislative (1)
European News (1)
Social (2)
Romania can outrank Poland in terms of GDP per capita at purchasing power parity
Romania can outrank Poland in terms of GDP per capita at purchasing power parity by the middle of this decade, provided it accelerates reforms and the public sector’s digitalization and provided it places bigger focus on investments in research, according to an analysis made by Banca Transilvania. Poland and Romania are currently the top two economies in Central and Eastern Europe, with nominal GDP levels of EUR 0.5 trillion and EUR 0.2 trillion respectively in the pandemic year 2020, according to Andrei Rădulescu, Macroeconomic Analysis Director at Banca Transilvania.
Finance Ministry plans to raise RON 75 billion from the domestic market in 2022
The Ministry of Finance plans to issue about RON 75 billion government securities on the domestic market in 2022, 90% of them with medium- and long-term maturities. BCR analysts point out that this sum also includes RON and euro-denominated government securities for the population in the equivalent of RON 10 billion, with 1-5 year maturities. Moreover, analysts also emphasize that the indicative volume of external loans is about EUR 14 billion. This is distributed in approximately EUR 10 billion Eurobonds, EUR 3.7 billion amounts from the Recovery and Resilience Facility, and around EUR 0.4 billion loans attracted from international financial institutions.
The public administrations sector’s financial assets grew by 1.3% in Q3/2021
The public administrations sector’s financial assets, expressed as a share of Romania’s Gross Domestic Product, grew by 1.3%, to 26%, in Q3 of 2021, mainly following the increase in deposits and cash, according to data published by the National Bank of Romania (NBR) on Thursday, 6 January 2022. The aforementioned source also indicates that public administration’s financial commitments were up 3.3% at the end of Q3/2021 year-on-year, accounting for 56.4% of GDP. The increase in this financial instrument is explained by the evolution of debt securities issues, RON and foreign currency-denominated ones, launched both to finance the budget deficit and to refinance public debt.
Prime Minister discussed the management of European funds absorption with authorities
Prime Minister Nicolae-Ionel Ciucă called a working meeting with the Managing Authorities and relevant ministers at the Government’s headquarters. Dan Vîlceanu, Minister for European Projects and Investments, Cseke Attila, Minister for Development, Public Works and Administration, Adrian Chesnoiu, Minister for Agriculture and Rural Development, Secretaries of State and Directors-General/Representatives of Managing Authorities participated in the talks. The main topics debated had to do with the implementation of the 2014-2020 Multiannual Financial Framework, the preparations for the 2021-2027 programming period and the National Recovery and Resilience Plan, according to a press release issued by the Government. The Prime Minister emphasized the importance of taking all necessary measures for the absorption of the over EUR 80 billion available for Romania from the three European resources.
Societe Generale’s division ALB will pay EUR 5 billion to acquire peer LeasePlan
ALD, French banking group Societe Generale’s vehicle-leasing subsidiary, will pay EUR 4.9 billion to acquire peer LeasePlan. The transaction will lead to the creation of a new market leader on this segment and to a higher value for SocGen shareholders. The new extended entity to result from the purchase agreement will have a combined fleet of about 3.5 million vehicles, the French banking group indicated. Following the transaction, SocGen’s vehicle-leasing division will expand its activity and will benefit from more electric vehicles.
Europe’s top banks plan to reward their investors in the coming months
Europe’s top banks, including BNP Paribas SA and UniCredit SpA, plan to hand out record rewards to investors in the coming months, as they seek to support their share prices amid uncertainty over revenues growth and the economic outlook. Nine of the euro area’s biggest listed lenders are set to pay about EUR 27.8 billion in dividends and share buybacks in the following months, more than the highs preceding the 2008 financial crisis, according to calculations by Bloomberg analysts. This is good news for investors after several years of modest yields and restrictions regarding dividends paid by banks, introduced by regulators during the pandemic period.
EIB grants EUR 90 million financing to Electrica for modernization works
The EUR 90 million loan offered by the European Investment Bank (EIB), over a 15-year crediting period, to Distribuție Energie Electrică România SA (DEER), the electrical power distribution operator part of the Electrica Group, represents the second tranche of the EUR 210 million financing aimed at supporting the EUR 300 million energy infrastructure investments program. The investment plan will support the consolidation and modernization of the electrical power distribution network, including the modernization and construction of new power lines, the construction and development of power stations and the installation of network automation components in the entire Romania.
General Motors will launch the electric version of Chevrolet Silverado pickup truck in 2023
General Motors (GM)’s strategy on the electric vehicles segment, which includes USD 35 billion investments, will face its biggest test in 2023, when the US group will launch the electric version of the Chevrolet Silverado pickup truck, with a six-digit price tag, more than a year after rivals Ford Motor and Rivian Automotive’s electric car launches. GM CEO Mary Barra stated on Wednesday, during an online intervention at the annual technology conference CES that Silverado’s electric version would be launched in two stages in 2023, starting from the second quarter, with a USD 39,900 WT pickup truck that would be delivered to a limited group of commercial fleets.
Ministry of Finance financially supports the construction of Cluj Regional Emergency Hospital
The Ministry of Finance is promoting the draft normative act approving the EUR 305 million Financing Agreement signed between Romania and the European Investment Bank in Bucharest, on 11 November 2021, and in Luxembourg, on 15 November 2021. The approximately EUR 454.4 million investment consists of the construction of a new regional hospital in Cluj, with 849 beds. The new hospital will replace and will take over the activity of Cluj-Napoca County Emergency Hospital (except for two of the three existing Gynaecology/Obstetrics departments, which will be kept in the current location).
The law increasing criminal penalties for those who attack forestry personnel was promulgated
The law increasing criminal penalties for those who attack forestry personnel was promulgated by President Klaus Iohannis on Wednesday, 5 January. Threats, personal injuries or blows causing death will be punished the same as those against police officers or gendarmes, and will be considered assault. The normative act, adopted by the Chamber of Deputies in December, was initiated by Senator Tánczos Barna, the Environment Minister, so that the offence of assault would also apply to forestry personnel as well. The Environment Minister argued that six foresters had been killed and 700 employees in the system had been attacked in the past six years.
European News 
European airlines are affected by the pandemic restrictions
The European Union is under increasing pressure to further ease rules on airport take-off and landing slots to cut the number of "ghost flights" airlines are running to retain them. Carriers say the requirement for them to use 50 per cent of their slots — down from 80 per cent in pre-pandemic days — or lose them is forcing them to operate empty or half-empty flights. Belgium’s Brussels Airlines, for instance, says it will have to operate 3,000 under-capacity flights up to the end of March.
The state of alert in Romania will be extended by another 30 days
The state of alert in Romania will be extended by another 30 days starting from Saturday, when new measures will come into force, amid the fifth pandemic wave. On Thursday, the Government adopted the decision including the new restrictions established by the National Committee for Emergency Situations the day before. The most important measure targets the obligation to wear protective masks outdoors as well, and stipulates that cloth or plastic masks will no longer be allowed, and only medical or FFP2 masks can be used.
This year’s edition of "Rabla" car scrapping program will start on 4 February
Environment, Waters and Forests Minister Barna Tanczos announced, during a press conference, that this year’s edition of the "Rabla" car scrapping program would start on 4 February, on Green Friday, and all the elements would be presented next week. The EUR 10,000 premium for fully electric cars and the approximately EUR 4,500 premium for plug-in hybrid cars have been maintained in the new edition of the "Rabla Plus" program, but the premium must not exceed 50% of the new car’s value. In last year’s edition, those who wanted to give up an old, polluting car and buy an electric vehicle could benefit from both the RON 7,500 scrapping premium granted under the "Rabla Classic" program and from the eco-voucher allocated within the "Rabla Plus" program.