News

Daily Newsletter - 7 September 2021

Summary

Macroeconomic (2)
Financial (1)
Investment (2)
Legislative (3)
European News (1)
Social (2)
Macroeconomic 
PSD has called for the immediate increase in the minimum wage per economy
The Social Democratic Party (PSD) has called for the immediate increase in the minimum gross wage per economy from RON 2,300 to RON 2,500. PSD also intends to initiate a draft law on supporting SMEs, in order to compensate for the losses incurred due to the growing utility prices, so that the sums resulting from capitalizing on supply can be equitably redistributed to employees, and the increase in the minimum wage should not put additional pressure on companies’ costs, the Social Democrats also indicated.
Ministry of Finance reopened a bonds issue due in October 2034 and borrowed RON 300 million from banks
The Ministry of Finance reopened a bonds issue due in October 2034 and borrowed RON 300 million from banks on Monday, in line with the scheduled level, at an annual interest rate of 4.34%. Six primary dealers participated in the auction. The total volume of demand stood at RON 712 million, a level corresponding to the sum offered by banks.
Financial 
Net interest income continued to increase in H1/2021
Net interest income, banks’ most important profit resource, continued to increase in H1/2021, but the growth rate only reached 1%, to RON 7.78 billion, given that lending grew at an average rate of over 7.7%. As a comparison, net interest income had risen 4.2% in H1/2020, while lending had increased by at an average rate of about 6%. Banks recorded about RON 9.36 billion revenues from interest charged on loans in H1/2021, down by 3.2% year-on-year. Interest income therefore decreased after having increased by over 5% in H1/2020, and, in H1/2019 the growth rate of interest income had stood at 18% year-on-year.
Investment 
Emerson has invested more than USD 160 million in Romania
Emerson, a US technology, engineering and production company, has invested more than USD 160 million in Cluj-Napoca since 2006 up to present and has reached nearly 3,000 employees, according to the company. The company has approached several directions of cooperation with local universities, including mentoring programs for students, over 10 editions of summer internship programs and internship programs. This year, the company has inaugurated a technical laboratory within the Faculty of Chemistry of Babeş-Bolyai University and has modernized the Emerson laboratory from the Technical University, within the Faculty of Automation and Computers, using the latest Industry 4.0 technologies and automation solutions.
Ministry of European Investments received the EC’s green light for new financing
The Ministry of European Investments and Projects has received the European Commission’s green light for EUR 206,983,569 financing for the "Regional project for the development of water and wastewater infrastructure in Olt County", selected within the Large Infrastructure Operational Program (POIM). The financing request was submitted to the European Commission in March. The European Commission mentions, in its financing decision, that Romania provided all the necessary information regarding the major project in accordance with Article 101 of EU Regulation no. 1303/2013. The total financing approved for water and sewerage within POIM 2014-2020 amounts to EUR 5.150 billion, of which financing decisions have been issued for EUR 3.181 billion and there are 20 more projects under approval.
Legislative 
Senate rejected draft law that provided for mayors’ election within a two-rounds voting system
During the plenary session on Monday, the Senate rejected the draft law that provided for mayors’ election within a two-rounds voting system, according to the Senate’s official page. The Chamber of Deputies is the decision-making forum. There were only 41 votes in favor, 74 votes against and 10 abstentions. UDMR announced, in a press release, that it had voted against the draft law, considering that the two rounds election system did not increase mayors’ legitimacy, but led to the formation of coalitions in the second round.
The offshore wind energy law will be finalized in 2021
Energy Minister Virgil Popescu stated on Monday, 6 August, that the offshore wind energy law would be finalized in 2021, in order to allow measurements to start for future projects. He also said that Hidroelectrica was ready to start an investment in the Black Sea. The Minister participated in the Romanian Energy Symposium - SIREN 2021, organized by the World Energy Council’s Romanian National Committee during the period 6-8 September.
Senate adopted draft law regarding assault committed against forestry personnel
During the plenary session on Monday, 6 September, the Senate adopted, with 120 votes in favour, a draft law according to which the assault committed against forestry personnel, in the exercise of their duties, shall be sanctioned as per the law regarding this crime, and the limits of the punishment shall be increased by half. The draft law is aimed at amending the constitutive content of the offense of assault, as stipulated by the Criminal Code. According to the explanatory memorandum, the initiator of the draft law considers that the tightening of the sanctioning regime for the acts of assaults committed against forestry personnel will discourage acts of aggression against the state authority, on a short term, allowing forestry personnel to perform their duties in a safer environment, and, in the long run, will help reduce crime in general.
European News 
European banks have not reduced their presence in tax havens, despite several scandals
European banks have not reduced their presence in tax havens, despite several scandals that have revealed the dubious practices multinationals use to avoid taxes, according to a study published on Monday (6 September). Europe’s leading banks each year book €20 billion euros ($24 billion), or 14% of their total profits, in 17 territories with particularly favourable tax regimes, said a report by the EU Tax Observatory, which is housed at the Paris School of Economics.
Social 
Prime Minister stated he was ready to assume responsibility on Vulnerable Consumer Law
Prime Minister Florin Cîţu has stated that he is ready to assume responsibility on the Vulnerable Consumer Law in case the Romanian Parliament does not approve this law within a week. The Prime Minister has also indicated that an emergency ordinance will be approved, through which compensations will be granted for Romanians’ bills.
Incidence rate of Covid-19 cases in Bucharest could reach 6/1,000 in the second half of October
Education Minister Sorin Cîmpeanu stated on Sunday, 5 September, that the incidence rate of Covid-19 cases in Bucharest could reach 6 per one thousand in the second half of October, a threshold from which students will switch to online classes. He indicated that the decision to switch to online teaching and learning or not would be made according to the incidence rate announced on Fridays and would be maintained for the entire following week, even if, in the meantime, the incidence rate reached 6 per thousand. The minister said that, for the time being, a week before the beginning of the new school year, no locality in Romania had an incidence rate of 6 per thousand, except for two localities that were in quarantine, but one of them did not even have a school. Therefore, school will start with physical attendance in the entire country.