News

Daily Newsletter - 7 May 2020

Summary

Macroeconomic News (3)

Digital economy could be Romania's next growth engine

The digital economy with all its branches could be an opportunity for Romania to build a new economic engine, while bringing the opportunity of a new business stage for Romanian producers, according to the representatives of the business community attending the "Restart Romania. What the new economic era will look like" video conference, organized by "Ziarul Financiar", BRD Groupe Societe Generale, BRD Asset Management, and NNDKP.

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EC's spring forecast

Romania's economy is expected to shrink by 6% of GDP this year, while the budget deficit could reach 9.2% of GDP, according to the European Commission's spring forecast released on Wednesday. The figures are below the European averages, but above the Government's estimates. The European executive sees an economic recovery of 4.2% for 2021, but a worsening of the budget deficit to 11.4% of GDP, if the Government goes ahead with plans to increase pensions by 40% in September.

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UniCredit Bank expects Romanian economy to contract more than 9%

Romania will face a deep recession in 2020, with the economy contracting over 9% in real terms and the government being able to provide only limited support due to the delicate fiscal situation, according to a macroeconomic analysis and strategy report published by UniCredit Bank. According to the report, the gross domestic product (GDP) could start growing in the third quarter of the year, after a sharp decline in the second quarter.

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Financial News (3)

BT: Net interest margins down across board

The net interest margins fell across the board in March, according to data released by the National Bank of Romania (BNR). The net interest margin for RON-denominated loans and deposits dropped 13 base points, down to 6.24% in March, the lowest figure in two years.

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FNGCIMM sends clarifications to individuals

The clients of the partner banks who secured loan payment suspensions through agreement with the banks before the government issued Decree 37/2020 can also apply for payment suspension under the decree. The clarification came from the National Loan Guarantee Fund for Small and Medium-sized Enterprises (FNGCIMM).

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BRD earnings down 19.33%

BRD, the Romanian subsidiary of French financial group Société Générale, posted RON 233.28 million in earnings for the first quarter, down 19.33% compared to the corresponding period of last year, according to the results sent to the Bucharest Stock Exchange (BVB) on Wednesday. Net interest income amounted to RON 512.74 million, up 6.3% year-on-year.

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Legislative News (2)

Constitutional Court defends special pensions

The Constitutional Court of Romania accepted on Wednesday the arguments put forward by the High Court of Cassation and Justice (ICCJ) and the People's Attorney (AP) regarding the bill repealing some regulations on service pensions and occupational pensions.

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Bill allowing consumers to postpone installments, bills - unconstitutional

The Constitutional Court of Romania rejected the bill passed by the Social Democrats (PSD), ALDE and Pro Romania last month, which would allow consumers to postpone paying their loan installments by nine months and their utilities bills by three months.

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Politics (2)

Iohannis: Although the European Union is going through a hard time, it is not abandoning its strategic objectives, not its closest partners

President Klaus Iohannis said that "although the European Union is going through a hard time, it is not abandoning its strategic objectives, not its closest partners". The president called for a consolidated partnership between the European Union and the Western Balkans.

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PM Orban: CCR is breaking the law

Prime Minister Ludovic Orban blasted the Constitutional Court of Romania after it declared unconstitutional the fines issued during the state of emergency. The PM said the Court "is on the side of those who break the law" and called the ruling "obviously political in nature".

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Social (1)

Most parents support decision to keep schools closed

A study published on Wednesday by IRES shows that about three quarters of parents support the decision of the authorities not to reopen schools this academic year, even though a third of them have a hard time ensuring a balanced work and childcare schedule. The state of emergency imposed by the COVID-19 pandemic has brought many changes, including in the education system.

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