We bring you the second part of our review of the 2016 economic year.
Today we bring you
the second part of our review of the 2016 economic year. Before we begin, we
would like to remind you that last week we made mention of the economic growth
in 2016 standing at around 5%. Also, we told you about the VAT rate being
reduced from 24% to 20% as of January 1st 2016, and the decision
made by the Romanian Central Bank to maintain the monetary policy interest rate
at 1.75%, all throughout the year. Now we continue our review of the most
relevant economic events in 2016.
Transparency platform was launched on March 12, offering open access to the
revenue and expenditure balances of all state institutions. If they go to www.transparenta-bugetara.gov.ro
on the Internet, Romanians have access to the entire financial activity of
public institutions, as well as to their contracts. The aforementioned platform
was created and launched with the clear purpose of curtailing fraud and
On March 16, it was announced that Romania would continue to benefit
from the expertise of the European Investment Bank, the European Bank for
Reconstruction and Development and the World Bank. The three banks will support
structural reforms and help prepare and implement projects funded from the
European Structural and Investment Funds, with the purpose of increasing the
absorption rate for the current
programming period, 2014-2020, and preparing the next one. The agreements
signed with the three major financial institutions are valid until December 31st,
March 23, the Romanian Parliament voted into law the bill on the setting up of
the National Committee for Macroprudential Supervision. A similar body had been
set up at the level of the European Union, namely the European Systemic Risk
Board, to respond to needs occurring during the crisis and afterwards. The
European Systemic Risk Board issued the recommendation whereby every state
should set up a similar board.
The role of the National Committee for
Macroprudential Supervision is to asses
economic risks and make recommendations, including to the Government, to
stave off potential risks. If it does not take into consideration the
aforementioned committee's recommendations,
the Government takes full responsibility for that, and is therefore in
no position to blame it all on the fact that it had not been forewarned, the
Romanian Central Bank Governor Mugur Isarescu said in the summer of 2015,
against the backdrop of public debates on the usefulness of setting up such a
On March 22nd, Ford US carmaker announced it would invest 200
in the manufacturing of the class B EcoSport model at the car factory in the southern
Romanian town of Craiova in 2017. The model is currently manufactured in India
and its sales are on the rise on the European market. The EcoSport city-sized
SUV will benefit from improved accessories
and parameters. Also it will be the second Ford model manufactured in Romania,
following the B-Max.
March 31st, the provider of cloud communications solutions 8x8, an
American company based in California's
Silicon Valley, opened its Eastern Europe's first operations center in
Cluj-Napoca, drawn by the high-speed Internet connection. 8x8 announced it
would create around 100 jobs by the end of the year.
German consortium Daimler on April 4 inaugurated in the western Romanian town
of Sebes the production of state-of-the-art gear boxes for Mercedes Benz. The
300 million Euro-worth project also made possible the creation of more than 500
jobs at the Daimler car factory in Alba county, central Romania. Daimler's
Romanian branch, Star Transmission was set up in 2001, when a production unit
was opened in Cugir, for gear pinions, axes and processed parts for engines,
gear boxes and direction systems. In 2013, another production unit was opened
in Sebes, for automatic gear boxes.
on April 4, the board of the Financial Supervisory Authority approved the
takeover of the Credit Europe Insurance Reinsurance Company by the German Group
ERGO. "The takeover of Credit Europe Insurance Reinsurance is the first ever
transaction made by an internationally acknowledged investor on Romania's
general insurance market after the economic crisis that broke out in 2008",
officials of the Financial Supervisory Authority said back then.
April 8th, Standard&Poor's confirmed Romania's BBB minus
and A minus 3 ratings for the country's long and short-term hard and local
currency debts, with a stable outlook. BBB minus is the first rating
in the investment grade category recommended for investments. Romania benefits
from a Baa3 rating from Moody's and a BBB minus rating from Fitch.Standard&Poor's stated that maintaining
the ratings for Romania was possible because of a moderate external debt level,
against the backdrop of stable economic growth prospects.
August 1st, the VAT for farming services, seeds, pesticides and
fertilizers was slashed from 20 to 9 per cent. The measure had a positive
effect on prices put up by providers in the field, and also took out from the
gray area various categories of services in the farming sector.
On September 13, Airbus Helicopters inaugurated its new factory in
Romania, which is an investment worth 52 de million Euros. H215 two-engine
helicopters will be manufactured in the factory. The first such helicopter is
expected to emerge out of the assembly line in 2018. The Airbus
Helicopters Industries factory is located in Ghimbav, nearby Brasov, in central
Romania and stretches on a surface area of 10,000 square meters.