October 1, 2015 UPDATE

A roundup of domestic and international news

Newsroom, 01.10.2015, 12:15

ILLEGAL SOFTWARE SCANDAL — Car dealers in Romania are no longer allowed to sell the diesel versions of the Volkswagen, Audi, Skoda and Seat brands. The measure was taken on Thursday by the Bucharest authorities. Last week, the Romanian Car Registry Authority announced that it runs checks to identify the presence of devices used to manipulate the level of exhausted fumes on the cars for which it had already issued homologation certificates to the manufacturers. It also called on the Volkswagen representative office in Romania to provide it with a list of the car makes that are equipped with such devices. Since the start of the scandal, it was revealed that some 11 million cars sold by Volkswagen and its branches the world-over are equipped with this software, although it is not activated on all of them. Volkswagen has recently announced that it worked out a plan to repair the diesel cars that have been equipped with the illegal software mean to cheat on pollution tests.

FINANCIAL – A new agreement with the IMF will give more credibility to Romania’s economic policies, will be helpful to get funding in more advantageous conditions on international markets and most likely than not will also boost reform processes, says the governor of the National Bank of Romania, Mugur Isarescu. In his opinion, given that the budget deficit is small, funding needs can be controlled and consequently a new agreement should not be focussed on issues related to the balance of payments, but on the problems still left pending, such as structural reforms. Finance minister Eugen Teodorovici has said Romania will officially ask for the conclusion of a new agreement with the IMF this year. Since 2009, Romania has signed three consecutive agreements with the IMF and the EU.

UNIVERSITY YEAR – A new academic year started in Romania on Thursday. Surveys show Romanian universities have fewer students, their number decreasing by 50% in a time span of only 7 years. Furthermore, 50% of the university graduates do not have a job according to their profession. A reason for the small number of students is the continuous drop in the birth rate. In another move, data made available by the National Statistics Institute show that at present Romanians take less interest in higher education than they did in the past.

SYRIAN FILE – US Secretary of State John Kerry and Russian Foreign Minister Serghei Lavrov, whose countries carry our air strikes in Syria, agreed to coordinate military actions over Syria in order to avoid accidentally trading fire. The announcements was made just hours after Russia announced it launched the first air strikes in Syria, against the Islamic State terrorist group. The US and NATO believe however that the attack supported president Bashar al-Assad and was aimed against the lay Syrian opposition, according to which the air strikes by Russian aircraft made 36 victims among civilians, including children. Russian officials rejected Western affirmations and underlined the legality of the operation, carried out at the request of Syrian president Bashar al-Assad. Russia launched new airstrikes on Thursday. The Russian Defense Ministry announced the country’s air forces bombed and destroyed several positions of Islamic State in Syria.

MOLDOVA – The Prime Minister of the Republic of Moldova, a former Soviet state with a predominantly Romanian speaking population, Valeriu Streletz, called again for the withdrawal of Russian troops from the pro-Russian breakaway region of Transdniester, in the east. In a speech delivered in New York on Thursday before the UN General Assembly, Streletz said the so-called peace keeping operation carried out by Russian troops should be turned into a civil mission under an international mandate. Transdniester got out from under Chishinau’s control in 1992, following an armed conflict which left hundreds of victims and ended with the intervention of the Russian troops on the separatists’ side. The troops are still in the area, although Moscow committed itself to pulling out its troops as early as 1999, at the OSCE summit in Istanbul. Streletz addressed the UN General Assembly in New York whereas in Chishinau, his government, of self-declared pro-European orientation, is more vehemently contested by the pro-Russian opposition.

ECONOMY – The Managing Director of the IMF, Christine Lagarde, considers that there are reasons of concern for the world economy, which is weakened by China’s slowing down economy and is running the risk of entering a “vicious circle” because of the estimated increase in the interest rates by the American Central Bank, FP reports. The interest rate has stood close to zero percent since 2008 and this change might prompt investors to give up investing in emerging countries, to repatriate funds to the US and thus to help the dollar gain ground. Furthermore, the debt of many countries is in US dollars. The IMF has repeatedly advised the American Fed to wait until 2016 to increase interest rates, in the context in which many heads of the central bank stand for making a first increase by the end of the year.