The Business Week in Romania 24.10 - 28.10.2016

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MACRO & PUBLIC POLICIES NEWS

·     C.F.A. macroeconomic confidence index plummets

The C.F.A. macroeconomic confidence index plunged to 53.3 points in September, a vertiginous drop of 11.5 points compared with the previous months. The current conditions index was at 67.0 points, a fall of 3.8 points, and the expectations index fell by 15.3 points to 46.4 points. The Euro-Leu exchange rate for the next six months is expected to be 4.5000. The rate of inflation for the next twelve months (October 2017-October 2018 is expected to be 1.20%.

·     Romania one of the E.U. states with the lowest government debt

In the second quarter Romania’s government debt was 269.78 billion lei or 36.7% of G.D.P., a decrease of 0.5 percentage points compared with the first quarter, when it was 267.208 billion lei or 37.2% of G.D.P.  Thirteen E.U. states saw a rise in government debt in the first quarter, while another fifteen saw a decrease.

·     Little chance of Romania going bust

Romania’s chances of going bust are at their lowest for the last eight years. The C.D.S. reference index decreased to almost 100 points in October, whereas the figure was 700 during the economic crisis. The foreign markets continue to view Romania as a low risk, which is reflected in the credit default swap figure for October.

·     Romanian mergers and acquisitions market cut by half

In the first quarter, the Romanian mergers and acquisitions market shrank to 1.1 billion dollars, a decrease of fifty per cent compared with the same period of 2015, according to the EY barometer. The total estimated value of transactions in Central and South-Eastern Europe in the first quarter of 2016 was 14.1 billion dollars, 14.3% lower than in the same period last year. The decrease was mainly caused by a drop in the number of transactions of more than one billion dollars.

·     Budget deficit 3.7% of G.D.P. in first nine months

The general consolidated budget for the first nine months of 2016 closed with a deficit of 3.7 billion lei, or 0.49% of G.D.P. Revenues for the general consolidated budget were 165.8 billion lei, or 21.9% of G.D.P. The figure is two per cent lower in face value terms than that for the same period last year. Expenditure, to the sum of 169.5 billion lei, increased in face value terms by four per cent compared with the same period of last year, but decreased by 0.6% as a percentage of G.D.P.

·     Harder to start a business in Romania, but easier to pay taxes

When it comes to getting credit, Romania comes seventh place in the rankings, the same as last year. But starting a business in Romania has been made more complicated because of the time-consuming purpose of registering as a payer of V.A.T. However, there has been major progress with regard to making it easier to pay taxes. The World Bank’s Doing Business 2017 report states: “In Romania it is harder to start a business because of changes to V.A.T. registration.” Romania is in 36th place out of 190 countries, compared with 37th place last year.

 

Sources: Agerpres, News.ro, Ziarul Financiar, Curierul Național

 

BUSINESS AND INVESTMENT NEWS

·      Airbus wants cluster of suppliers in Romania

Airbus Helicopters wants to create a cluster of suppliers in Romania to provide solutions and equipment for Airbus Helicopters, according to company representatives, speaking at the new factory in Ghimbav at a meeting of seventy potentially interested companies. Serge Durand, director general of Airbus Helicopters Industries said: “Our aim is to develop a supply chain in Romania to serve not only Airbus Helicopters Industries in Romania, but also our global network”.

·      Mass hiring at Altex

Electricals retailer ALTEX Romania wishes to hire 450 new staff to work at its Altex and Media Galaxy shops around the country. The largest numbers of vacancies are in Bucharest, Sibiu, Arad, Ploiești, Oradea, Satu Mare, Iași and Buzău. Three hundred and eighty sales consultant jobs are up for grabs, as well as thirty-five cashier jobs, ten financial manager jobs, and twenty-five assistant shop manager jobs. ALTEX Romania offers wage packets of between 1,500 and 2,700 Romanian lei, depending on the position.

·      Ministry of Transport threatens “painful cuts”

Danil Butunoi, president of the Senate Transport Committee says that Tarom operates safely and its aeroplanes do not break down more frequently than those of other companies. He has announced that Tarom will have to be restructured before the Government spends a single penny of Romanians’ money on a new fleet. An international consultant will deliver a report on Tarom in the spring of next year, after which restructuring will commence. The next government, says Butunoi, will have to take responsibility for restructuring, no matter how “painful” it might be.

·      Yves Weerts invests 33 million Euros in a city-centre office building in Bucharest

Yves Weerts, who developed the Deva Logistics Park, which he then sold to the C.T.P. investment fund, is now investing thirty-three million Euros in an office block in the centre of Bucharest: Unirii View. Building work began this month and is due for completion in the second quarter of 2018. The investment aims to reposition the centre of Bucharest as a top location for office buildings.

·      Twenty-five per cent increase in imported second-hand motorcars

The second-hand motorcar market saw a twenty-five per cent increased in the first nine months of this year compared with 2015, with 222.859 units having been imported, the highest level for the last eight years. The most frequently imported motorcar makes are Volkswagen, Opel and Ford.

·     New motorcars market up by 20%

Sales of new motorcars look set to increase by fifteen to twenty per cent compared with 2015. The market has recorded its biggest value since 2015, according to Cristian Cojocaru, Sales Manager at Autovit.ro. Thanks to the government’s “Rabla” Programme, the biggest increases were in July, August and September. In the first six months of the year, average sales were seven thousand units per month, but in August 12,400 new motorcars were registers.

·     Lidl opens new shop with a different concept

Lidl continues to invest in Romania, having opened its two hundred and first shop, which features a new format. The new shop is on Șoseaua Pantelimon no. 111A, and opened on 27 October. With a semi-basement and ground floor, the Pantelimon shop is the only one of its kind in Romania. Parking is on the ground floor and escalators whisk customers down to the demi-basements, where they can do their shopping.

·      Cosmopolis gets its own mini mall

The Cosmopolis residential complex is to get its own mini mall. Real-estate developer Open Land Development has invested 2.2 million Euros in a 10,000-square-metre strip mall within the complex, which is due to open in late November and will have a Carrefour supermarket, Inmedio, a VET Life pet shop, and Ocean Fish and Domino’s Pizza outlets. There will also be restaurants, cafés, a children’s play area, and a beauty parlour.

·      Veranda Mall opens

The Veranda Mall, a sixty-million-Euro investment by Prodplast Real Estate, has opened in the Obor Market area and is ninety seven per cent occupied. The developer estimates that there will be twenty thousand visitors daily. The complex has a surface area of thirty thousand square metres. There are one hundred shops and one thousand two hundred parking spaces. Veranda Mall occupied the Prodplast plastics factory next to the Obor Market. Prodplast was relocated to the Faur industrial platform.

·      Chirițoiu: Romanian Post Office could be listed on the bourse within two years

The Romanian Post Office is on the right track and there are chances that the company could stabilise and be listed on the stock exchange within two years, according to Bogdan Chirițoiu, Chairman of the Monopolies Commission. The company employs around 27,000 and is Romania’s largest employer. Poșta Română started making a profit again in 2014, after laying off 3,650 staff. This year, Poșta Română, which is controlled by the Ministry of Communications, could receive fifty million Euros in state capital to pay off its debts.

·      Eximtur: sales up 14% in the first three quarters

Eximtur saw a 14% increase in sales in the first nine months of this year compared with last year and an increase of 16.5% in the number of tourists. The company predicts sales worth forty-seven million Euros this year. Eximtur’s business travel division has grown by 22% and now represents 65% of the company’s total sales.

 

Sources: Bursa, Ziarul Financiar, Curierul Național, Agerpres, Profit.ro, News.ro

 

 

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