The International Monetary Fund is likely to disburse both next two tranches of its EUR13 billion loan to Romania mid-March, according to IMF representative ,Tonny Lybek. A new IMF mission will visit Romania end January or early February to assess the country's economic performance and decide on the next aid tranches, said Lybek. IMF concluded its assessment mission earlier than scheduled, saying that will return to Romania after the country's political situation is resolved. Romania was scheduled to receive a EUR1.5 billion third tranche from the IMF in December this year, but the country must adopt the 2010 budget first, a move seen unlikely in the absence of a proper government. In October, the eastern European country plunged into political turmoil, after its government failed a no-confidence vote in parliament. The lawmakers have since refused to back a new Cabinet, in response to President Traian Basescu's refusal to designate their candidate for premiership.
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Romania's public debt went 27.6 % up, on September 30, reaching 140.09 billion lei, that is 28.17 % of the gross domestic product (GDP) estimated for the current year, according to data published by the Public Finance Ministry. Total public debt was of 109.75 billion lei at the end of 2008 and represented 21.78 % of last year's GDP. The weight of the public governmental debt in the whole of the debt increased by 1.26 percentage points versus the end of 2008, from 91.58 % to 92.84 %, while the local public debt stood for 7.16 % of the total debt after the first nine months. Romanian ministry said 61.96 % of the debt was maturing in the short run, 34.85 percent was medium-termed and 3.19 % was maturing in more than 5 years. The ratio of the negotiable debt rose to 38.6 % at the end of September, from 25.7 %, in December 2008.
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Today's reference rate of exchange settled by the central lender NBR lowered to the steepest level of the past six weeks and the leu remained below the threshold of 4.28 lei / euro, following a strong advance at debut, on a market with high trading volumes. Related: National currency to a reference rate of exchange of 4.2952 lei/euro Romanian currency drops to EUR 4.29 Dinu Patriciu: „Leu currency has nothing to do with real economy” Euro currency trap: we live at 4.1 RON, but die at 4.8 RON The National Bank of Romania reported a reference level of 4.2811 lei per euro, versus 4.2928 in the previous session. National currency soared from 4.2990 to 4.2750 over the euro and then swayed near this level. At 3 p.m. banks were buying an euro with 4.2759 lei and selling it for 4.2849 lei.
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Romanians diagnosed with cancer need a lot of luck, since the support fails to appear. They have to face medicines’ high prices and the system’s red tape. Chronically ill people in Romania got tired of the indifference, humiliations and flaws of the sanitary system. They demand respect for their right to live. Doctors gave no chance for survival to the four-year-old little boy from Pelisor village, Sibiu. Florian Fulga has spent most of the year in a children medical center in Timisoara. He had been diagnosed with an advanced form of cancer, in January 2009, and has been hospitalized until past month. His mother wanted to keep on fighting, even after doctors gave up and released him from hospital, hoping he’d find another remedy. The boy started a natural treatment, which gave results, but thr products cost almost as much as his mother earns per month.
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Subway employees resumed their activity, at 4 p.m., after the strike between 5.00 a.m. - 4 p.m., as a consequence road traffic being seriously affected, in spite of RATB's supplementing the capacity of transport with an additional 200 buses, trolley buses and trams. Metrorex employees demand 20% wage raises and are set to halt all activity every day until 4 p.m.. Subway employees cannot halt activity altogether because the law requires them to cover one third of regular activity even during a general strike. The capital's road public transport company RATB sent out all its available vehicles to fill the gap caused by the subway strike, but the city's streets couldn't fit the extra one third of the population that usually takes the subway, which led to numerous traffic jams and angered most people who got out of the house. People owning stores inside subway stations complained they lost more than half the day's earnings because of the strike.
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Dacia presented today the new SUV model Duster, made in Mioveni factory. This is the first time this version appears in public. Dacia has planned a surprise, offering a preview of the Dacia Duster, which anticipates the brand's first 4x4 model, to be sold as of 2010, an Automobile Dacia press release said. The competition vehicle has a fiber glass body, a V6 engine built by Renault Nissan which provides 350 hp at 7,500 rpm and is located in the vehicle's back. The gearbox has six steps. Duster will be the sixth Dacia model and the brand's first SUV. The Andros Trophy's twentieth edition will begin in December. The competition is renowned for being one of the most difficult in the world. French-born Alain Prost is 54 and a four-time F1 world champion: in 1985, 1986, 1989 and 1993. He has taken part in every edition of the Andros Trophy since 2003-2004, and has won twice. France and Germany are the main markets for Dacia, a company owned by the Renault group. Former Formula 1 pilot Alain Prost will drive a Dacia Duster competition model in the French Andros Trophy ice racing championship, in a preview of the Romanian producer’s first SUV.
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The cheapest property for sale in the 10th edition of the National Real Estate Fair is a EUR 34,900 one-room flat. The flat belongs to Fortuna Residence assembly, from Alexandriei Street and measures 42 square meters. The building is part of a nine-block complex, three of which are already finished. Related: China is the new world champion in real estate transactions Real estate fair – lower price offers, but no customer base Real estate crisis ends at the end of 2009 Real estate fraud to spread According to the fair’s organizers, with the amount solicited in February for a 42-meter one-room flat in Prelungirea Ghencea, that is EUR 4,0817, one can purchase, in November, a 48-meter one-room flat in Alexandriei Street, and you still have a EUR 5,917. What is more, they say, you have to pay another 11,900 for the parking place, or this is included in the selling price. One of the most interesting offers is the one offered by Poiana Florilor, Salaj developer, which receives as anticipation the customer’s old car or house.
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The rocket's modules had been taken out of the ship and transported into a TIR to the Romanian Aeronautics and Cosmonautics Association (ARCA), in Ramnicu Valcea. The launch of the first Romanian rocket into space was rescheduled for the beginning of 2010 after a series of problems caused by weather conditions. ARCA was planning to launch the first Romanian rocket on Saturday, at the Black Sea. But, the launch planned for Saturday was postponed over bad weather conditions and rescheduled for next year. "Helen", designed and built by ARCA, is a three-stage orbital rocket and represents Romania's entry in the Google Lunar X Prize competition which aims at sending on the moon a device meant to transmit data on earth. Created in 2007, Google Lunar X Prize is an international space competition to land a robot on the surface of the Moon, travel 500 meters over the lunar surface, and send images and data back to the Earth. The prize for the winning team is $30 million.
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The National Loan Guarantee Fund has received, so far, over 8,300 guarantee requests of “First Home” program, almost 8,000 of them being approved. The value of the requests exceeds EUR 330 million, which is a third of the approved ceiling. The medium value of a guarantee is about EUR 41,000 and the majority wants to buy a two-room flat (45,9%). 21.76 % requested guarantee for a three-room flat and 13.4 for one-room flat. About 28 % of the houses purchased through this government program had been built after 2008 and only 5 % of these asked for buildings in course of developing. In the top of the districts, after the number of guarantee requests, are the following: Bucharest, Constanta and Brasov. The most active banks participating in the program are BRD, BCR, Alpha Bank, Banca Transilvania and Millennium Bank.
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Metrorex employees will go on a general strike on Tuesday, November 17, protesting wage raise claims, which have been rejected after today's negotiations. As a consequence, the subway will be closed between 5 a.m. - 4 p.m., but will function normally from 4 p.m. to 11 p.m.. Subway unionists failed to reach an agreement with acting Transport Minister Radu Berceanu. The two parties met, Monday morning, to find a solution that would prevent a general strike. The unionists demand the start of negotiations for a new collective labor contract and want wage raises of nearly 26%. Last week, Berceanu said, before the Government meeting, in which the subway company's 2009 budget was approved, that subway workers' wage claims are ungrounded and exaggerated.
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Next year, world economy will face a high unemployment rate in the developed countries, a protectionism coming back and the risk or some stock market and real estate speculative bubbles. At least, this is what Robert Zoellick, World Bank chairman, thinks. The World Bank official says trust may be again affected in 2010, if real estate and stock market bubble are not controlled. And this will happen, in spite of the fact that economy is on its way back to recovery and trust is very important, says Zoellick. The high unemployment rate, especially in the developed countries, will represent a new peril for banks, since consumer or mortgage loans will be impossible to reimburse.
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While neighbor countries have taken drastic measures to revive economy, Romania takes populists decisions, in full electoral campaign, deepening even more financial downfall. Eastern Europe countries that enacted restrictive politics in due time are now taking advantage of the increase o appetite for Western imports. The rhythm of the economic decrease in Central and Eastern Europe countries has been slowing down in the third quarter, with Western trade partners encountering an increasing side. The request for region countries exports has risen, especially in the case of four states: Hungary, Czech Republic, Slovakia and Poland. In Romania, exports balance in relation to GDP is strongly negative, -15%. On the other hand, Hungary began to register trade gluts, this year, exports’ value exceeding imports. Counting among the new EU entries, Romania will probably be the only country to register a deeper economic decline in t third quarter of this year, comparative to 2008’s same period. Specialists reported for Bloomberg news agency that Romanian GDP would keep on decreasing, to -9% in the third quarter, comparing to the previous quarter, when GDP was -8.7%. The increase in demand of goods ans services present in the European Union countries had no real influence on our country, in the sense of an economic recovery. ”We begin to see an improvement of the situation in the Eastern Europe, with the stabilization of the external climate” says Neil Shearing, economist in Capital Economics, London. „Economic recovery always begins with the Western European countries, which contribute to the increase of regional exports and to the reestablishment of the capital flow” added Shearing.
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The level of the flat tax and the value added tax will not increase in 2010 in Romania, as any increase in taxation would be “an error,” acting Economy Ministry Adriean Videanu said during an economic forum Thursday. Romania applies a 16% flat tax on income, since 2005, The VAT level currently stands at 19%. Income tax and VAT account for almost half the country's budget revenue. On Wednesday, Romania's central bank governor Mugur Isarescu said the authorities can either redirect budget funds to better performing economic sectors or take the unpopular measure of hiking taxes in a move to consolidate public finances.
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2010 budget will allocate 7 % of GDP, or 20 % of the public sector spendigs, for investments, same as in 2009, according to the interim minister of Finances, Gheorghe Pogea. Only that budgetary execution on the first nine months of the year show that, by September, only 3 % of GDP represented investment spendings. Romanian private environment took a harder blow than the public sector in the financial crisis’ aftermath and the authorities will take measures to correct the asymmetry created, interim Finance Minister Gheorghe Pogea said Thursday. We are determined to correct this asymmetry between the private and public sectors. In all honesty and fairness, the private sector was the one to suffer during this difficult period, Pogea said during the Central European Initiative Summit Economic Forum in Bucharest. They deserve congratulations for having sacrificed profit margins to keep their staff in place, Pogea also said. Romanian economy will see a gradual recovery, but the reforms launched by the government must continue, even if some of them are not that popular.
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Humiliation: Ceausescu spent 23 minutes waiting for a ride in plain field, near Salcuta. Left in a barley field by the presidential helicopter, Ceausescu had desperately searched for a ride to pick him up from the desert. On December 22, 1989, one hour after leaving the CC head office, the “steerman” and the “academician” were abandoned on a wild desert, south-east of Salcuta village, near Titu. “Unshaven, scared and in a trebling voice” this is how villagers and neighborhood farmers remember the fugitive. The two left after 23 minutes, with a car run by doctor Deca.
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Reference exchange rate settled by the central lender BNR went 0.02 % down to 4.2952 lei / euro, following leu currency's slight increase in the first part of the session, in line with the emergent currencies in the region. BNR posted yesterday an exchange rate equal to 4.2961 lei /euro. Romanian national currency gained ground from 4.2980 to 4.2945 versus the euro and then fell to 4.2965, while the Polish zloty climbed from 4.1750 to 4.1284 per euro and the Hungarian forint soared from 271.60 to 269.20 versus the single European currency.
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EBRD estimates that Romania will register a 1 % growth in 2010, but unemployment claims will continue to grow, considering the Romanian companies are not prepared for new hires. "I think you've gone through the worst of this crisis" said bank's chief economist Eric Berglof, in Bucharest. Romanian lenders’ main challenge ahead is to offer long-term loans in Romanian lei, because is unhealthy for households and companies to be borrowing in foreign currency while their income is in lei, an official with the European Bank for Reconstruction and Development said Wednesday. EBRD's chief economist Erik Berglof said Romanian banking sector reacted well to the financial crisis and the parent lenders' actions to support their local subsidiaries are closely monitored. The situation is stable and the banks have taken commitments on the long term in Romania, Berglof added. He said it is only natural that the parent bank's exposure to Romania will see a slight reduction on the short term, given that this is a direct consequence of falling demand.
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The Romanian President Traian Basescu stated on Tuesday that if the government formed by designated prime minister Liviu Negoita gets a no-confidence vote in Parliament, he would name a third prime minister, according to the public television. Basescu said he doesn't want to defy the Parliament by designating Negoita again, if his cabinet gets a no-confidence vote in Parliament, stressing he will designate a new prime minister, if it should be the case. The Romanian head of state said he has the obligation to designate the country's prime minister and stressed he sould name a new primier immediately, given the country's stringent need to have a government. On Monday, Negoita submitted to the Parliament a Cabinet the list of fourteen ministries led by some of acting democrat liberal ministers, independent Gabriel Oprea and other politicians.
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The largest Romanian oil company, Petrom, reported, on Tuesday, a net profit of 615 million lei in the third quarter of the year, slightly down from RON626 million in the same period of the last year, on a 25% lower turnover. From July to September, Petrom's earnings before interest and taxes, or EBIT, rose 10% on the year to RON705 million. However, earnings before interest, taxes, depreciation and amortization, or EBITDA, fell 31% to RON1.14 billion. Petrom, which is owned by Austria's OMV, posted a net turnover of RON3.53 billion in the third quarter, from RON4.73 billion in the same period a year before. The results reflect lower oil prices and sales of commercial fuels and gas compared with the similar period of 2008, Petrom said in a statement.
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The number of swine flu infections in Romania reached 1,001, with 94 new cases confirmed in the last 24 hours, according to the National Center of Communicable Diseases Prevention and Control. Three high-schools in Bucharest have been shut down so far. Starting from next Monday, antivirals specific to the swine flu treatment will be used only for the severe cases, the mild infections being treated with usual medicines, not Tamiflu. The first swine flu contamination in Romania occurred on May 23, on a young woman who had returned from the United States. On November 26 begins the national vaccination campaign against swine flu. The first to get vaccinated will be the pupils, the students and the medical staff. Romanian authorities will buy 500,000 doses of vaccine from abroad for the children between 6 months and 6 years old.
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The Romanian actor Gheorghe Dinica, aged 75, died. He underwent a bile duct laparoscopic surgery on Monday evening and his condition was critical.
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Romania's commercial gap reduced by 58.5 % in September, comparative to last year's same month, to EUR 1.055 billion, as the decline of imports outpaced more than twice the shrink of exports, according to data published by the country's statistics body INS. Imports reduced to EUR 3.65 billion in September and exports compressed 13.1 % year-on-year to 2.59 billion euros. The largest decline was seen in the trade with states outside the European Union, where Romania imported merchandise worth EUR 984.7 million, 44.6 % less than the similar month of 2008. Imports from the other 26 EU members slipped 28.9 % in September to EUR 2.66 billion. As to exports, Romania shipped merchandise worth 607.9 million euros to countries outside the EU, 25.6 % less than in September last year, while exports with EU members reduced 8.3 % to EUR 1.98 billion. Exports rose 18.8 percent and imports advanced 24.5 % in September on the previous month. Romania's commercial gap narrowed by 61.4 % in the first nine months to EUR 6.93 billion.
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Designated premier Liviu Negoita announced today, 5 p.m. the componence of the new Cabinet made up of 14 ministries, with only three ministers differing from the ones proposed by former designated prime minister Lucian Croitoru. The three are: Anton Cristian Irimie minister of Health, Gabriel Oprea , minister of Internal Affairs, and Valeriu Tabara, minister of Agriculture and Rural Development. Liviu Negoita announced that the Government he proposes is supported by PDL party and the group of independents. He said he sent the list of designated ministers to the Parliament. Here’s the list of the proposed cabinet: Minister of Finances: Gheorghe Pogea Minister of Administration and Internal Affairs: Gabriel Oprea Minister of External Affairs: Bogdan Aurescu Minister of Economy and Trade: Adriean Videanu Minister of Education, Research, Youth and Sports: Daniel Funeriu Minister of Transports and Communications: Radu Berceanu Minister of Regional Development and Tourism: Vasile Blaga Minister of Justice: Catalin Predoiu Minister of Health: Anton Cristian Irimie Minister of Environment: Sulfina Barbu Minister of Labor, Family and Social Protection: Mihai Seitan Minister of National Defense: Mihai Stanisoara. Minister of Agriculture: Valeriu Tabara Minister of Culture: Theodor Paleologu
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Rain is expected countrywide during the interval Tuesday 1 a.m. - Wednesday 6 a.m. in the southern part of Romania. Tthe overall quantity of water will reach 25-30 liters per square meter and, in certain areas 50-60 liters per square meter, according to ANM (Romanian weather administration). The following countries will be affected by heavy rain: Dolj, Mehedinti, Gorj, Valcea, Arges, Dambovita and Prahova. The weather administration authority issued Monday code yellow warning of rain, valid between 1 a.m. Tuesday and 6 a.m. Wednesday, affecting seven counties in the central and southwestern part of the country.
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The Romanian state risks to be out of liquid money by the end if the year, in the context of IMF postponing the third tranche of the external loan. Related: IMF postponed the second loan tranche More exactly, to be out of resources for the current spending, such as: the payment of salaries and pensions, unemployment budget supplementation or the reimbursement of some loans in the last part of the year. As an alternative, the Romanian state will resort to other financing sources. Since an external market loan would be very expensive and impossible to obtain, the Ministry of Public Finances will continue to get finance from the internal market. In the following period national currency may by submitted to depreciation pressures, taking into account the poor fundaments of the Romanian economy, but also to the pressures coming from the political environment.
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IMG head in Romania, Jeffrey Franks, European Commission director Elena Flores and World Bank country director, Arntraud Hartmann, present the preliminary conclusions of the evaluation mission. Related: EC: Romania's political instability could prelong economic crisis IMF: Risks rise in Romania. Structural measures may not be implemented Jeffrey Franks (IMF): We’ve made very good progresses, from the last 10 days discussions with the Romanian authorities; now we can be in the position of analyzing the situation and free the money as soon as the political situation will be solved. Although we couldn’t finish the research, we’ll continue working on it and we are prepared to send missions to continue and finalize the analysis. Since 2009 was more difficult than we had anticipated, the effects will be seen in a higher deficit in 2010, unless other measures won’t be adopted. Without an additional action, budget deficiency will reach 9 % of GDP. At this moment, we foresee a better position, though the prognosis of budget deficit decrease by 8 %, comparative to 8,5%, from the previous estimations. Read here what are the consequences of IMF decision to postpone the third tranche of Romania's external loan.
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Romanian President Traian Basescu designated Liviu Negoita, the mayor of capital's district 3, for the function of prime minister. Negoita is the second nominee for premier, after the Cabinet proposed by economist Lucian Croitoru faced a no-confidence vote within Parliament. Negoita, a democrat liberal, said he wants to form a coalition government and negotiations would start Friday and a proposed Cabinet list would be sent to Parliament Monday. My mission is clear. I want a national coalition government and negotiations will start today. Romania needs financial aid and must follow through with its agreements with the IMF, World Bank and the European Commission, Negoita said, adding politicians must be reasonable and give the country a government with full powers. Basescu said he designated Negoita in order to fulfill the requirements of the parliament majority that was pushing for Sibiu mayor Klaus Johannis. He said that Negoita, as Johannis, was reelected mayor last year with 80% of votes.
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Unemployed claims will rise by about 100,000 within the following two months, reaching more than 725,000 jobless people, the leader of the Romanian industry union - UGIR 1903, Cezar Corici, told a news conference Thursday. Unemployment rate rose by 0.3%, to 6.9%, comparative to the previous months, while the total number of unemployed people reached 625,140, up 24,000 in comparison with August, according to data released by the National Employment Agency. In September last year, unemployment rate in Romania was 3.9% The International Monetary Fund (IMF) estimates that this year's unemployment rate will reach 9.6%, comparative to 8.9%, in the beginning of negotiations for a standby loan agreement early 2009. Unemployment rate may rise to 10% in 2010, and drop to 8.3% in 2011, according to the IMF's estimations after the first evaluation of the agreement.
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There are clues that the Army commander did not want to commit suicide, but only to get injured, to quit the scene. But, what is he had been killed? Not by Ceausescu, but by those who could use this situation: anti-Ceausescu protesters. After the noise produced by the gun Vasile Milea had been killed with, a medical team was called. In about a quarter of hour from the accident, there came a doctor. On December 22, in the morning, Petra Tudor was working. He had tried to help the general, who was moaning in a swamp of blood on a sofa, somewhere on the sixth floor of the Communist Party Central Committee building. It was death’s office. Room no. 621 – the office of colonel Parcalabescu, commander of the Patriotic Guards Formations. In the 1991 hearing, led by senators of “December 1989” Commission, dr. Petra Tudor explained her useless efforts to save general Milea. In the first place, the doctor called to offer medical assistance didn’t know who the patient was. She had found out he was a soldier, but didn’t know any more details. “He was moaning, with his eyes closed. A subdued moan. He couldn’t speak.“
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The Romanian designated prime minister Lucian Croitoru lost the confidence vote in the Parliament Wednesday. His government was rejected by 250 lawmakers, leaving the country stuck in a political deadlock. Only 189 lawmakers voted for Croitoru. The government needed 236 votes to be instated. Related: Romanian Parliament to express its vote on the new government Lucian Croitoru to name the new Cabinet - 7 technocrats and 7 PDL members Opposition to reject Croitoru and reaffirm its support for Johannis Romanian designated premier asked PSD to appoint three candidates Lucian Croitoru, the new prime-minister of Romania Croitoru, told lawmakers before the vote the country needs a stable government, with full powers to carry on with IMF-required reforms, adding a potential halt of the country's agreement with the IMF would bear serious consequences for its external credibility, more so than if the deal had never been signed. Romania faces a deep political instability after the government collapsed in a no-confidence vote mid-October, and is in desperate need of the following two tranches of a EUR20 billion IMF-led loan package. Lacking a proper government, Romania may face a delay on the IMF loan disbursements.
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