News

Daily Newsletter - 14 June 2018

Summary

Macroeconomic News (4)

Heatwave pushed electricity consumption up 15%

The national electricity consumption jumped more than 15% in the past two days, as summer weather pushed temperatures above 30 degrees Celsius. A Transelectrica press release indicated that no supply problems are expected.

Top

Foreign debt up EUR 1.59 billion in four months

Romania's total foreign debt jumped EUR 1.59 billion in the first four months of this year, reaching a total of EUR 95.07 billion, according to the National Bank of Romania (BNR). Long-term debt accounted for EUR 67.73 billion of the total (71.2%), down 1.3% from the end of 2017.

Top

Inflation rate up

The annual inflation rate was 5.41% in May, up from 4.95% in April and well above BNR's 2.5% target. Economist Dragos Cabat said that the inflation rate may stop growing.

Top

Average pension up 10%, purchasing power up 5%

The average pension was RON 1,122 in the first quarter of this year, down 0.9% from the previous quarter, but a strong 10.3% increase from the first quarter of 2017. However, the purchasing power dropped to 98.1% of Q4, 2017, because of the rising inflation.

Top

Financial News (2)

BNR to rein in retail borrowing

The National Bank of Romania (BNR) has distributed for consultation a draft modification of Regulation 17/2012, which would lower the indebtedness rate significantly. However, the draft is expected to suffer major changes before approval, according to BNR sources. The document stipulates a 40% indebtedness cap for retail debtors.

Top

Cabinet approves self-improvement loan program

The Cabinet approved the self-improvement loan program called "Invest in Yourself", which will allow people aged 16 to 55 to borrow up to RON 40,000 in order to invest in their own education. At the same time, the Cabinet allocated RON 115 million for developing the home assistance program for elderly Romanians and is working on a state aid scheme for the cinema industry.

Top

Investment News (2)

Alexandrion considers new distillery

The Alexandrion Group, the biggest producer of spirits in Romania and a new player of the hotel market, will start building a new distillery in the USA in the next two months. A second distillery is being considered for Bucov, Prahova county, the site of an existing Alexandrion distillery.

Top

FDI up 24.6%

The aggregated value of foreign direct investment jumped 24.6% in the first four months of this year, compared to the corresponding period of 2017, reaching a total of EUR 1.49 billion, according to the National Bank of Romania (BNR). The number of new companies established by foreign interests moved up 0.1% on an annual basis to 1,848.

Top

Legislative News (2)

Final version of bill that lets companies distribute earnings to shareholders every quarter

Companies will be able to distribute earnings to shareholders every quarter as early as this year, based on the financial reports approved by shareholders or partners. The bill was passed by the Chamber of Deputies and will be sent to the President for signing.

Top

Senate passes Criminal Procedure Code amendments

The Senate passed on Wednesday, June 13, the amendments to the Criminal Procedure Code. The bill passed with 74 votes in favor and 28 against. No senator abstained. The bill is now on its way to the Chamber of Deputies, which casts the deciding vote.

Top

Politics (2)

President Iohannis mocks PM Dancila

President Klaus Iohannis said that functional illiteracy, which is estimated at 42% in Romania, "is very visible at the top of national politics". In his speech, the President mocked Prime Minister Dancila: "We continue to move away from the Europe 2020 target - or 20-20, as some say - for reducing the number of students who drop out of school".

Top

Dragnea bows to pressure, fires party member over FB posts

Liviu Dragnea, leader of the Social Democratic Party (PSD), announced on Wednesday that he had fired George Harabagiu, coordinator of the party's online presence. Harabagiu used the party organizations' Facebook accounts to falsely claim that the fans gathered at the National Arena had jeered tennis champion Simona Halep.

Top