The Business Week in Romania 06.06 - 10.06.2016



• World Bank forecasts slower economic growth

The World Bank marginally improved its estimates for economic growth in Romania in 2016 from 3.9% to 4%, but reduced its forecast growth in GDP for 2017 and 2018. According to the Global Economic Prospects report, the World Bank predicts 3.7% economic growth for Romania in 2017, compared with the forecast of 4.1% given in a similar report in January, and growth of 3.4% in 2018, compared with 4%. The World Bank has downwardly adjusted its forecast for global economic growth because of the low performance of raw-materials-exporting countries. According to the World Bank, the global economy will grow by 2.4% this year, compared with the previous estimate of 2.9%.

• Romanian estimate: average economic growth of 4.5% annually

The Minister of Public Finance, Anca Dragu, claims that the Romanian economy will grow by 4.2% this year and an average of 4.5 in 2017, 2018 and 2019, despite the fact that international financial institutions have made downward adjustments of their estimates for Romanian economic growth in the following years. “Romania has solid economic growth. For this year we forecast an increase of 4.2%, and for 2017, 2018 and 2019 we estimate an improvement of this figure to 4.5% on average per annum,” declared Anca Dragu on Thursday at the World Credit Congress and Exhibition, held in Bucharest. According to the most recent data published by the National Forecasts Commission, in 2016 Romania’s GDP will increase by 4.2%, and by 4.3% and 4.5% in 2017 and 2018 respectively.

• Romania wants to join the OECD

Romania wants to become a member of the Organisation for Economic Co-operation and Development, Prime Minister Dacia Cioloș told members of the organisation’s council in Paris at a special summit dedicated to Romania and presided over by the General secretary of the OECD, Angel Gurria. For a country to become a member, however, it has to be invited. Romania officially submitted its candidacy in April 2004 and again in November 2012, but was rejected. Poland, Hungary and Czechia are all members. The OECD is an intergovernmental forum for thirty-five developed nations, twenty-three of which are in Europe, accounting for seventy-per cent of global manufacturing and trade and ninety per cent of direct foreign investments.

• Emergency tax exemption ordinance for commissioning payments

The Ministry of Public Finance is working on the draft of an Emergency Ordinance to modify the Fiscal Code to allow debtors who invoke a commissioning payment to be exempt from the tax levied on the transfer of property, but only for the first such commissioning payment, announced Minister Anca Dragu. She says she will take into account application of the exemption for a single home, without sorting beneficiaries according to income or other criteria, because in that way the legislation would be difficult to implement. The Minister of Finance stated that she is also analysing the case of people who have already been subject to foreclosure and are listed as in debt to the state for the impost due on the transfer of property at the moment of foreclosure. Likewise, the minister is examining the case of people who have mortgages on multiple properties (land, buildings). The Emergency Ordinance will have to be ready by the end of June if Parliament is still to be in session to pass it.

• The ASF wants a 10% reduction in insurers RCA contributions

The board of the Authority for Financial Supervision (ASF) has passed a project to modify the contributions of insurance companies for RCA policies, with the rates to be reduced by ten per cent. “A plan has been passed to modify Regulation no. 16/2014 regarding the incomes of the Financial Supervisory Authority, which principally stipulates the elimination of the contribution for market makers on the capital market and a reduction of contributions of insurance companies for RCA policies by ten per cent. The plan will be published on for public consultation for ten days,” according to an ASF press release. At the end of 2015, the ASF announced that this year it would reduce from 1% to 0.8% the rate applied to gross RCA premiums used to administer and maintain the CEDAM database. In April this year, in accordance with an ASF decision, the rate of the contribution of RCA policy issuers to the Victims of Road Accidents Protection Fund was maintained at two per cent of the volume of the premiums received from this type of insurance.

• Energy Ministry considers partial liberalisation of natural gas prices for domestic consumers from 1 July

The Ministry of Energy is considering partial elimination of the regulated price of natural gas from domestic production supplied to the populace and area heating plants from 1 July 2016 given the ample decrease in the price of imported gas, but preserving a price ceiling in conformity with the timetable for deregulation currently in force, in order to avoid the risk that imported gas might start to increase in price again, which would burden domestic consumers. Last month, the National Energy Regulatory Authority proposed that the Government freeze the price of natural gas for domestic consumers at its current level until October, although the timetable agreed to by the Executive, the European Commission and the FMI stipulated a 10% price increase from 1 July, or else that it modify the liberalisation timetable in accordance with the new market prices, according to the institution’s president, Niculae Havrileț.

Sources:, Ziarul Financiar, Agerpres



• Piraeus Bank Romania makes profit

In the first quarter of 2016, Piraeus Bank Romania managed to make a profit, a result of the process of consolidation and restructuring carried on in 2015, according to a press communiqué. The value of the net profit is around one million Euros, an increase on the same period in 2015, when the bank booked losses of seventeen million Euros. Clients’ deposits, worth 861.6 million Euros, remained steady compared with the end of last year, but were 14% lower than in the first quarter of 2015. The rate of equity increased to 17% in the first quarter of 2016, compared with 12.1% in the first quarter of 2015. The gross value of the credit portfolio was around 800 million Euros, a decrease of three per cent compared with the end of 2015. The gross credit/deposits ratio was 0.92 as of 31 March 2016, a slight increase compared with the end of 2015, when the ratio was 0.89. In 2016, Piraeus Bank aims to double its volume of new loans in the IMM and corporate area and to triple its retail volume, through development of advantageous credit products adapted to clients’ needs.

• Omniasig launches Casco for cars older than ten years

Omniasig, the largest general insurer on the local market, with a market share of fourteen per cent, is introducing a CASCO product aimed at individuals aged over thirty who own cars older than ten years. The product is aimed exclusively at covering cars in the case of accidents and direct collisions with other cars within Romania, regardless of whether the owner or the other driver is to blame and does not have RCA insurance. The insurer promises prices starting at 300 lei per annum, for an insured sum of 5,000 lei, and says that there is no need for a risk inspection form or to complete a questionnaire. The insured period can be six months or a year, depending on the client. Likewise, there are three options for the insured sum: 5,000, 10,000 and 15,000 lei.

• EU spends 373 million Euros on financing the heating, gas and electricity infrastructure in Romania

The Ministry of European Funds has announced that it has finalised its project guidelines and has launched an appeal that makes possible the development with European funds of the heating, electricity and natural gas infrastructure starting in 2016. The total budget is 373 million Euros, with 187 million earmarked for the Capital. The guidelines are aimed at national electricity and natural gas networks Transelectrica and Transgaz, as well as at the mayors of București, Botoșani, Oradea, Iași, Râmnicu Vțlcea, Bacău, Timișoara and Focșani. The EU demand to finance these cities has its origins in the period prior to Romania’s accession to the EU (PHARE project). The aims of the funding are to reduce losses of hot water through the network of area heating pipes—estimated at a third of the energy produced in Bucharest—and to reduce the price of a gigacalorie. The published figures do not include the performance reserve, allocated only if the beneficiaries achieve the performance indicators agreed with the EU.

• Expert Petroleum Luxemburg takes over Petrofac România

Luxembourg company Expert Petroleum SPV SARL is taking over petroleum service provider Petrofac Solutions and Facilities Support Romania. “The Competition Board will evaluate this economic concentration with a view to establishing its compatibility with a normal competitive environment and will issue a decision within the deadline stipulated by the law,” according to a press release. Expert Petroleum’s main activity is the provision of services connected with the extraction of raw petroleum and natural gas and is a member of the GMS Holdings international group, whose branch in Romania is Expert Petroleum S.R.L. Petrofac Solutions and Facilities Support S.R.L. is part of the British Petrofac group. In 2015, Petrofac has assets in Romania worth 139 million Euros. In 2015 the group had revenues of 6.8 billion dollars and a profit of 440 million dollars. In Romania the company has yet to publish its financial results for 2015. The most recent data are from 2014, when the losses of Petrofac Romania were four times larger than turnover, at 455 billion lei.

• MedLife targets total turnover worth 117 million Euros in 2016

MedLife, the market leader in private medical services in Romania, estimates that in 2016 it will end the year with a total group turnover of 117 million Euros. But if transactions with three or four large operators come to concretion, MedLife is expecting a total group turnover of 130 to 150 million Euros in 2016, a new historical record for the company. MedLife, the market leader for private medical services in Romania, ended the first quarter of this year with a total turnover of 27.6 million Euros, in line with the business targets announced by the company. For the second half of the year, the company plans to open two clinics in Brașov and Ploiești, bringing its network to thirty-five large medical centres in Bucharest and around the country.

• Dacia: new directors for the Titu Technical Centre and Logistics Department

From June, the Renault group will have new management at the Titu Technical Centre and at its Romanian Logistics Department. The change of management comes as part of promotions within the group. Ioana Manda (52) is the new director of the Titu Technical Centre, part of the Renault Romania Technology engineering centre. She replaces Anica Muntean, who becomes Project Director for Renault Group Romania. Set up in 2010, the Titu Technical Centre is responsible for testing vehicles and parts in various phases of the Global Access range. The centre is part of Renault Technology Romania, the largest Renault engineering centre outside France. Graham Lawrence Aylett has been appointed director of the Romanian Logistics Department. Since 2010, he was director of the Parts Centre at Oarja. He replaces Romanian Ștefan Gaibu, who will become head of the Europe Logistics Alliance at Renault in France. Located at the Mioveni plant, the Logistic Department sends Dacia, Renault and Nissan vehicle parts to factories in the Renault-Nissan Alliance around the world and finished vehicles within Romania and for export.

• Eric Stab: a new term at the head of the Foreign Investors’ Council

The board of the Foreign Investors’ Council (FIC) has elected Eric Stab, President and CEO of ENGIE Romania, to the position of president for a further term. The executive board of the FIC, with a mandate until May 2017, will be Eric Stab: President; Daniel Anghel, Tax Partner, PricewaterhouseCoopers: Vice-President; Mihai Bogza, chairman of the administrative board of Bancpost: Vice-President; Farrukh Khan, Managing Partner, Audit and Risk Evaluation Service, Deloitte Romania: Treasurer. “I wish to thank my colleagues on the new board for placing their trust in me to head the FIC in its twentieth year. It is an important anniversary for our organisation,
a constant voice for the business community in Romania,” declared Eric Stab. At present, the FIC has 124 member companies, whose total investments are worth around thirty-five billion Euros, or two thirds of the total foreign direct investments made in Romania since 1990s.

• Rockwell Automation coming to Bucharest

The American Rockwell Automation group, a business worth 6.3 billion dollars and with 22,000 employees worldwide, specialising in industrial automation solutions, is opening an office in Romania, having applied a similar measure in Hungary, in a context in which clients from both markets were hitherto served by the office in Prague. The direct entry of the Americans at the local level comes in the context in which industrial companies are placing an increasing emphasis on solutions to increase energy efficient with a direct impact on energy consumption, with competition between companies in this field increasing markedly in the recent period. “Rockwell Automation Inc. is expanding in Central and Eastern Europe and has opened two new offices: in Bucharest and in Budapest. Although we have been doing business in these countries for a few years, our local activities have been co-ordinated from the office in Prague, supported, for example, by Vestra in Romania,” said Peter Rozek, director of sales for Hungary and Romania. Rockwell Automation is present worldwide on more than
eighty markets.

Sources:, Wall-Street, Economică.net, Ziarul Financiar, Bursa


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