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Monday, November 29, 2004
A reliable source told me that the D.A. Alliance is going to become a single powerful political party.
It is still a project, there are of course some protests especially inside PNL, but it seems that Basescu and Tariceanu already agreed on that.
PNL will merge in some way with PD or, better said, D.A. will become one entity – not just a political and electoral alliance.
Time will tell…my source told me that it is settled.
I believe that would be a smart move.
On the other hand...the party of ethnic Hungarians (UDMR) , may play a kingmaker's role after the inconclusive Romanian election on Sunday. They said they were open to cooperation with both main parties…
“We do not exclude cooperating with any of the two main groups to form a majority in parliament" Peter Eckstein-Kovacs, a leading politician from the Hungarian Democratic Union (UDMR) party, told Reuters."Our main goal is to help the new government wrap up EU entry talks as soon as possible," “Tomorrow we are going to decide what to tell our voters regarding whom they should back for president," he said.
And I think that a minority PSD+PUR + UDMR or PSD+PUR + PRM - government with Basescu president would be an interesting experiment.
Some voices say that after the EU integration in 2007 the social shock would be so powerful that any party would have formed the government then it will lose the 2008 elections. Maybe it’s an acceptable scenario for the DA. Alliance To have the Presidency and to let PSD to form the Government and to support the integration social costs.
Whoever will gain the Presidency, whoever will form the Government, one thing is sure and I personaly am ready to fight in my way for this idea:
The Romanians have to decide who are those who deserve to rule us. And not the "voting tourists" or the masters of the voting boxes and of the opinion polls!
It is still a project, there are of course some protests especially inside PNL, but it seems that Basescu and Tariceanu already agreed on that.
PNL will merge in some way with PD or, better said, D.A. will become one entity – not just a political and electoral alliance.
Time will tell…my source told me that it is settled.
I believe that would be a smart move.
On the other hand...the party of ethnic Hungarians (UDMR) , may play a kingmaker's role after the inconclusive Romanian election on Sunday. They said they were open to cooperation with both main parties…
“We do not exclude cooperating with any of the two main groups to form a majority in parliament" Peter Eckstein-Kovacs, a leading politician from the Hungarian Democratic Union (UDMR) party, told Reuters."Our main goal is to help the new government wrap up EU entry talks as soon as possible," “Tomorrow we are going to decide what to tell our voters regarding whom they should back for president," he said.
And I think that a minority PSD+PUR + UDMR or PSD+PUR + PRM - government with Basescu president would be an interesting experiment.
Some voices say that after the EU integration in 2007 the social shock would be so powerful that any party would have formed the government then it will lose the 2008 elections. Maybe it’s an acceptable scenario for the DA. Alliance To have the Presidency and to let PSD to form the Government and to support the integration social costs.
Whoever will gain the Presidency, whoever will form the Government, one thing is sure and I personaly am ready to fight in my way for this idea:
The Romanians have to decide who are those who deserve to rule us. And not the "voting tourists" or the masters of the voting boxes and of the opinion polls!
Posted by Cristian C. Francu : 11/29/2004 08:41:00 PM
The results released by the Central Electoral Bureau based on half of the total count gave PSD - the governing party - more than 35 percent in Sunday's election, lead than three percentage points ahead of the centrist D.A. - Justice and Truth Alliance's 32.5 percent.
Given the results of the Sunday Election I am sure it will be extremely difficult for anybody to form the government and probably Romania will see, for the first time after 1989, a shorter parliamentary term and an early election.
In my opinion it is a very interesting situation. It is interesting to analyze, debate and even predict the future development of the situation. It is interesting to predict the future alliances and treasons
The figures indicated neither party would be able to form a majority in parliament and would have to seek partnership for a coalition government with either the nationalist Greater Romania Party, which scored about 13 percent, or its rival ethnic Hungarian Party, which netted about 8 percent.The presidential race was also close, with Prime Minister Adrian Nastase winning 38.90 percent, while main challenger Traian Basescu scored 34.82 percent, leading to a runoff vote on Dec. 12.
The opposition alleged fraud, with Basescu saying he had video evidence showing that the governing party bused its supporters around the country to vote repeatedly. He says the alleged fraud affected the results by 5 to 7 percent.``Romania has the right to have fair elections,'' said Basescu, adding that his party will ask for lists of voters to identify those who cast their ballots multiple times.
I personaly think we, as individuals, as citizens, as communities and as the civil society should not stay still and be quiet about it. We accepted the Constitution breach of Mr Iliescu who was still the President of Romania but deeply involved in the PSD electoral campaign...but I feel that we should not let them get away with this 'voting tourism' incident.
I am, and this is my personal opinion, convinced that we haven't the slightest chance to become a modern and powerful nation as long as those who rule us will behave like thieves, desperate to fill their pockets with votes and/or money.
Pro Democratia, said some of its 3,300 monitors saw buses full of PSD supporters touring the countryside, raising the prospect of multiple voting.
The OSCE (The Organization for Security and Cooperation in Europe) - said the vote ``seemed to be professionally and efficiently organized,'' but cautioned about procedures which made it possible for people to vote multiple times.
Romania's new president will lead Romania as it must implements economic and judicial reforms aimed at gaining EU membership by 2007. He will take over from Ion Iliescu, who is stepping down after leading Romania for 11 of the 15 years since the communist dictatorship was overthrown. (and these 11 years are for sure more than the two constitutional terms...)
I feel that it is still in our POWER to complete our public request and desire for change and evolution, voting on Sunday, December 12... a NEW President.
Given the results of the Sunday Election I am sure it will be extremely difficult for anybody to form the government and probably Romania will see, for the first time after 1989, a shorter parliamentary term and an early election.
In my opinion it is a very interesting situation. It is interesting to analyze, debate and even predict the future development of the situation. It is interesting to predict the future alliances and treasons
The figures indicated neither party would be able to form a majority in parliament and would have to seek partnership for a coalition government with either the nationalist Greater Romania Party, which scored about 13 percent, or its rival ethnic Hungarian Party, which netted about 8 percent.The presidential race was also close, with Prime Minister Adrian Nastase winning 38.90 percent, while main challenger Traian Basescu scored 34.82 percent, leading to a runoff vote on Dec. 12.
The opposition alleged fraud, with Basescu saying he had video evidence showing that the governing party bused its supporters around the country to vote repeatedly. He says the alleged fraud affected the results by 5 to 7 percent.``Romania has the right to have fair elections,'' said Basescu, adding that his party will ask for lists of voters to identify those who cast their ballots multiple times.
I personaly think we, as individuals, as citizens, as communities and as the civil society should not stay still and be quiet about it. We accepted the Constitution breach of Mr Iliescu who was still the President of Romania but deeply involved in the PSD electoral campaign...but I feel that we should not let them get away with this 'voting tourism' incident.
I am, and this is my personal opinion, convinced that we haven't the slightest chance to become a modern and powerful nation as long as those who rule us will behave like thieves, desperate to fill their pockets with votes and/or money.
Pro Democratia, said some of its 3,300 monitors saw buses full of PSD supporters touring the countryside, raising the prospect of multiple voting.
The OSCE (The Organization for Security and Cooperation in Europe) - said the vote ``seemed to be professionally and efficiently organized,'' but cautioned about procedures which made it possible for people to vote multiple times.
Romania's new president will lead Romania as it must implements economic and judicial reforms aimed at gaining EU membership by 2007. He will take over from Ion Iliescu, who is stepping down after leading Romania for 11 of the 15 years since the communist dictatorship was overthrown. (and these 11 years are for sure more than the two constitutional terms...)
I feel that it is still in our POWER to complete our public request and desire for change and evolution, voting on Sunday, December 12... a NEW President.
Posted by Cristian C. Francu : 11/29/2004 08:29:00 PM
source: Mediafax
Rom International Service, real estate company, launched for sale a residential project worth EUR8.3 mn. for building 23 villas in Ionescu Sisesti area from Bucharest, declared Monday, to MEDIAFAX agency, Cezar Lazarescu, general manager of the company.
"The investor we represent bought a land with an area of 12,725 square meters, worth EUR2.5 mn. and obtained all the necessary approvals and the construction authorization to make a residential assembly of 23 de villas. We also have insured the utilities - natural gas, water, sewerage", said Lazarescu.
Posted by Mihai Botea : 11/29/2004 05:53:00 PM
Rom International Service, real estate company, launched for sale a residential project worth EUR8.3 mn. for building 23 villas in Ionescu Sisesti area from Bucharest, declared Monday, to MEDIAFAX agency, Cezar Lazarescu, general manager of the company.
"The investor we represent bought a land with an area of 12,725 square meters, worth EUR2.5 mn. and obtained all the necessary approvals and the construction authorization to make a residential assembly of 23 de villas. We also have insured the utilities - natural gas, water, sewerage", said Lazarescu.
Posted by Mihai Botea : 11/29/2004 05:53:00 PM
Foreign portfolio investments increased in October by ROL 1,401 bln., doubling the net purchases of foreign investors from the beginning of the year, according to data sent by the National Securities Commission (CNVM).
In October, non-residents purchased shares from Romanian companies summing up ROL 2,430 bln. and capitalized deeds of ROL 1,029 bln. In the first ten months, the difference between the value of the purchased deeds and that of the sold deeds of foreigners’ rose to ROL 2,968 bln., and the foreign investors’ share stocks summed up ROL 7,604 bln.
Purchases last month mainly consisted of financial mediator companies and hydrocarbon extraction and crude oil processing companies. In October the biggest part of the Petrom capital increase operation took place.
The data sent by CNVM show purchases made by foreign investors of ROL 475 bln. in the crude oil processing industry, and for the hydrocarbon extraction, the sums that entered the market, summed up ROL 581 bln.
Posted by Mihai Botea : 11/29/2004 02:48:00 PM
In October, non-residents purchased shares from Romanian companies summing up ROL 2,430 bln. and capitalized deeds of ROL 1,029 bln. In the first ten months, the difference between the value of the purchased deeds and that of the sold deeds of foreigners’ rose to ROL 2,968 bln., and the foreign investors’ share stocks summed up ROL 7,604 bln.
Purchases last month mainly consisted of financial mediator companies and hydrocarbon extraction and crude oil processing companies. In October the biggest part of the Petrom capital increase operation took place.
The data sent by CNVM show purchases made by foreign investors of ROL 475 bln. in the crude oil processing industry, and for the hydrocarbon extraction, the sums that entered the market, summed up ROL 581 bln.
Posted by Mihai Botea : 11/29/2004 02:48:00 PM
Exit polls made public last night at 9 p.m., when voting officially ended, showed Adrian Nastase and the Social Democrat-Humanist (PSD+PUR) Union leading both the presidential and parliamentarian elections.
Adrian Nastase, the Union's presidential candidate got 41.1 percent of the votes, while Traian Basescu, the candidate of the Liberal and Democratic (PNL-PD) Alliance has 35.2 percent of the votes, according to the CURS exit poll, commissioned by Antena 1 private TV station, owned by Dan Voiculescu, the Humanist Party leader.
A second exit poll, done by Insomar and ordered by public television TVR, also places Nastase first in the race, but with 43.7 percent, while Basescu is nine percents behind, with 34.7.
According to the CURS exit poll, the third place is taken by Corneliu Vadim Tudor, the candidate from the Greater Romania Party (PRM), with 12.4 percent, followed by Marko Bela, from the Hungarian Democratic Alliance (UDMR) with 4.2 percent.
The Insomar poll shows slight differences, as Tudor occupies the third place with 11.6 percent, followed by Marko Bela with 4.2.Both exit polls show Romania's president will be decided in a second round of elections, with Nastase and Basescu fighting for the presidency, as had been expected.
The PSD+PUR Union also leads in the parliamentary elections, as the CURS poll shows that for the Deputies Chamber the Union has 38.9 percent, while the Alliance has 34.4 percent, followed by PRM with about 13 percent.
The Insomar poll placed the Union in first place with 40.1 percent, the Alliance in second with 33.8 percent, followed by PRM, with 13 percent.
Neither party has won a majority that would enable it to form a government, the polls indicated.
Official results to be known tomorrow.
In the parliamentary races, 314 seats in the Deputies Chamber and 134 seats in the Senate will be allocated proportionally to parties that win more than 5 percent of the vote.
The opposition has warned against possible "massive electoral fraud" by the government, and is setting up its own vote counting system.
The government has denied the charges.
About 3,300 Romanian and 50 foreign observers monitored the election.
Posted by Iulia Stoicescu : 11/29/2004 09:48:00 AM
Adrian Nastase, the Union's presidential candidate got 41.1 percent of the votes, while Traian Basescu, the candidate of the Liberal and Democratic (PNL-PD) Alliance has 35.2 percent of the votes, according to the CURS exit poll, commissioned by Antena 1 private TV station, owned by Dan Voiculescu, the Humanist Party leader.
A second exit poll, done by Insomar and ordered by public television TVR, also places Nastase first in the race, but with 43.7 percent, while Basescu is nine percents behind, with 34.7.
According to the CURS exit poll, the third place is taken by Corneliu Vadim Tudor, the candidate from the Greater Romania Party (PRM), with 12.4 percent, followed by Marko Bela, from the Hungarian Democratic Alliance (UDMR) with 4.2 percent.
The Insomar poll shows slight differences, as Tudor occupies the third place with 11.6 percent, followed by Marko Bela with 4.2.Both exit polls show Romania's president will be decided in a second round of elections, with Nastase and Basescu fighting for the presidency, as had been expected.
The PSD+PUR Union also leads in the parliamentary elections, as the CURS poll shows that for the Deputies Chamber the Union has 38.9 percent, while the Alliance has 34.4 percent, followed by PRM with about 13 percent.
The Insomar poll placed the Union in first place with 40.1 percent, the Alliance in second with 33.8 percent, followed by PRM, with 13 percent.
Neither party has won a majority that would enable it to form a government, the polls indicated.
Official results to be known tomorrow.
In the parliamentary races, 314 seats in the Deputies Chamber and 134 seats in the Senate will be allocated proportionally to parties that win more than 5 percent of the vote.
The opposition has warned against possible "massive electoral fraud" by the government, and is setting up its own vote counting system.
The government has denied the charges.
About 3,300 Romanian and 50 foreign observers monitored the election.
Posted by Iulia Stoicescu : 11/29/2004 09:48:00 AM
Friday, November 26, 2004
Pierre Moscovici, recommended that Romania completes accession negotiations by the end of the year.
He also suggested that the accession treaty be signed in the first half of 2005 and that integration take place in 2007.
Moscovici stressed the fact Romania still needs to do a lot of things but in his opinion, most of the EP Foreign Affairs Commission members were in favor of completing negotiations this year.
He expressed his intention to work closely with Romanian authorities, regardless of the results of the general elections.
He also said he is planning to visit the country after the elections, probably at the beginning of 2005, after the EU expresses its opinion regarding Romania's integration.
Posted by Iulia Stoicescu : 11/26/2004 11:42:00 AM
He also suggested that the accession treaty be signed in the first half of 2005 and that integration take place in 2007.
Moscovici stressed the fact Romania still needs to do a lot of things but in his opinion, most of the EP Foreign Affairs Commission members were in favor of completing negotiations this year.
He expressed his intention to work closely with Romanian authorities, regardless of the results of the general elections.
He also said he is planning to visit the country after the elections, probably at the beginning of 2005, after the EU expresses its opinion regarding Romania's integration.
Posted by Iulia Stoicescu : 11/26/2004 11:42:00 AM
Last month SIF Transilvania was again the top financial investment company in terms of profits since the beginning of the year. It achieved net profits of 818bn ROL (20.5 million euros), up 45% from the end of September.
The company made no less than 256bn ROL (6.4 million euros) last month, largely through selling 4.7% in Rompetrol Rafinare (Petromidia) on the Bucharest Stock Exchange (BSE), for which it received 14 million euros.
It already had one of the highest profits among SIFs in September due to its selling on the stock exchange of several stakes accounting for a further 4% in Petromidia. SIF Transilvania is the most expensive of all the SIFs on the BSE, its share price having come close to 10,000 ROL for the first time ever last week. It closed at 9,650 ROL yesterday.
Earnings per share at the end of October were approximately 1,500 ROL. Second top profit maker last month was SIF Oltenia with 698bn ROL (17.5 million euros). It doubled its profits in October after selling 0.6% in Petrom. It later bought this stake back at a 20% lower price during the capital increase operation by the petroleum company.
Posted by Mihai Botea : 11/26/2004 11:42:00 AM
The company made no less than 256bn ROL (6.4 million euros) last month, largely through selling 4.7% in Rompetrol Rafinare (Petromidia) on the Bucharest Stock Exchange (BSE), for which it received 14 million euros.
It already had one of the highest profits among SIFs in September due to its selling on the stock exchange of several stakes accounting for a further 4% in Petromidia. SIF Transilvania is the most expensive of all the SIFs on the BSE, its share price having come close to 10,000 ROL for the first time ever last week. It closed at 9,650 ROL yesterday.
Earnings per share at the end of October were approximately 1,500 ROL. Second top profit maker last month was SIF Oltenia with 698bn ROL (17.5 million euros). It doubled its profits in October after selling 0.6% in Petrom. It later bought this stake back at a 20% lower price during the capital increase operation by the petroleum company.
Posted by Mihai Botea : 11/26/2004 11:42:00 AM
The Romanian government denied Wednesday reports that it has started exclusive talks with parties interested in buying regional power suppliers.
The Economy Ministry said it is still evaluating bids from Germany's E.On AG ( EON) and the Czech Republic's CEZ AS (BAACEZ.PR) to buy Electrica Moldova and Electrica Oltenia.
The ministry denied a press report in daily Ziarul Financiar that said the government has started exclusive talks with E.On for Electrica Moldova, and with CEZ for Electrica Oltenia.
The government is offering a 24.62% stake in each power supplier, with the new owner required to gain a majority stake through a share capital increase.
The two companies supply electricity to the southwestern and northeastern parts of Romania, respectively.
Electrica Oltenia has 1.36 million customers and sells 6.8 million megawatt- hours a year, while Electrica Moldova has 1.3 million customers and sells 4.1 million MWh a year.
Earlier this year Romania sold two other power suppliers to Italian power company Enel SpA.
Enel agreed to pay EUR36 million directly to the Romanian state, and to make a capital injection of EUR76 million to acquire 51% of Electrica Banat and Electrica Dobrogea.
Electrica Banat provides electricity to western Romania, has 830,000 customers and sells 3.8 million megawatt-hours annually. Electrica Dobrogea serves southern Romania and has 590,000 customers, selling 3.6 million MWh annually.
Posted by Iulia Stoicescu : 11/26/2004 11:30:00 AM
The Economy Ministry said it is still evaluating bids from Germany's E.On AG ( EON) and the Czech Republic's CEZ AS (BAACEZ.PR) to buy Electrica Moldova and Electrica Oltenia.
The ministry denied a press report in daily Ziarul Financiar that said the government has started exclusive talks with E.On for Electrica Moldova, and with CEZ for Electrica Oltenia.
The government is offering a 24.62% stake in each power supplier, with the new owner required to gain a majority stake through a share capital increase.
The two companies supply electricity to the southwestern and northeastern parts of Romania, respectively.
Electrica Oltenia has 1.36 million customers and sells 6.8 million megawatt- hours a year, while Electrica Moldova has 1.3 million customers and sells 4.1 million MWh a year.
Earlier this year Romania sold two other power suppliers to Italian power company Enel SpA.
Enel agreed to pay EUR36 million directly to the Romanian state, and to make a capital injection of EUR76 million to acquire 51% of Electrica Banat and Electrica Dobrogea.
Electrica Banat provides electricity to western Romania, has 830,000 customers and sells 3.8 million megawatt-hours annually. Electrica Dobrogea serves southern Romania and has 590,000 customers, selling 3.6 million MWh annually.
Posted by Iulia Stoicescu : 11/26/2004 11:30:00 AM
Thursday, November 25, 2004
Ispat Sidex general director Narendra Chaudhary Wednesday said he expects the plant in Galati to report $2.1 billion in turnover at the end of this year, almost double compared to the $1.28 billion last year.
The company's output could advance to 5 million tons of steel this year, up from 4.6 million tons in 2003.
Chaudhary would not disclose the estimated profit for the current year, but added the result will exceed 2003 figures, which accounted for over $100 million.
The Ispat Sidex general director yesterday said the group plans to buy out the remaining stakes in Siderurgica and Tepro. According to Chaudhary, the cumulative turnover of the Anglo-Indian group could exceed $2.35 billion in Romania.
LNM yesterday said it would continue negotiations with Romanian authorities regarding the incentives the state gave to the group after taking over Ispat Sidex. "We have not reached a final decision yet and I cannot make any further statement on that," Chaudhary said.
He also admitted there are several aspects concerning Romania's accession to the European Union that could have an impact on the former agreements concluded between the two parties in 2001, when Sidex was privatized.
The European Union has asked Romanian authorities to limit incentives and only help companies in difficult financial situations.
Thus, the Sidex incentives could be cut, which would make the plant pay its profit tax starting in 2005.
At the time of privatization, the government offered the buyer fiscal incentives.
One would allow Sidex to delay payment of the Value Added Tax (VAT) related to imports for three years starting October 31, 2001.
The other would exempt it from paying profit taxes for a period of five years starting January 1, 2002.
Posted by Iulia Stoicescu : 11/25/2004 01:17:00 PM
The company's output could advance to 5 million tons of steel this year, up from 4.6 million tons in 2003.
Chaudhary would not disclose the estimated profit for the current year, but added the result will exceed 2003 figures, which accounted for over $100 million.
The Ispat Sidex general director yesterday said the group plans to buy out the remaining stakes in Siderurgica and Tepro. According to Chaudhary, the cumulative turnover of the Anglo-Indian group could exceed $2.35 billion in Romania.
LNM yesterday said it would continue negotiations with Romanian authorities regarding the incentives the state gave to the group after taking over Ispat Sidex. "We have not reached a final decision yet and I cannot make any further statement on that," Chaudhary said.
He also admitted there are several aspects concerning Romania's accession to the European Union that could have an impact on the former agreements concluded between the two parties in 2001, when Sidex was privatized.
The European Union has asked Romanian authorities to limit incentives and only help companies in difficult financial situations.
Thus, the Sidex incentives could be cut, which would make the plant pay its profit tax starting in 2005.
At the time of privatization, the government offered the buyer fiscal incentives.
One would allow Sidex to delay payment of the Value Added Tax (VAT) related to imports for three years starting October 31, 2001.
The other would exempt it from paying profit taxes for a period of five years starting January 1, 2002.
Posted by Iulia Stoicescu : 11/25/2004 01:17:00 PM
source: Reuters
Hungarian oil and gas firm MOL said on Tuesday it will buy Royal Dutch/Shell Group's Romanian fuel distribution business in a deal analysts valued at around $50 million.
The sale includes 59 gasoline filling stations and a smaller lubricants and aviation fuel business, enabling MOL to further expand its retail footprint in central Europe.
For Shell, the sale is the latest in a raft of disposals as the company presses ahead with a $10-12 billion divestment programme that will help fund increased oil and gas exploration.
Shell's Romanian liquefied petroleum gas (LPG) business is not included in the sale. This may be sold as part of the global LPG business of which Shell is also mulling a sale.
With the deal, MOL will have 130 filling stations in Romania, which gives it an 11 to 12 percent market share and makes it the second largest player in the country's fuel market after Petrom, MOL Communications Director Szabolcs Ferenc said.
Analysts said MOL had taken a big step toward meeting its targets. They said the company was known not to overpay.
"The rule of thumb is that each filling station costs $1 million, but I think they paid somewhat less, probably around $50 million for the whole thing," said K&H Equities analyst Peter Tordai.
At 1120 GMT, MOL stock was up 2.6 percent at 11,815 forints ($49.9).
Austria's OMV recently agreed to buy a 51 percent stake in Petrom for a reported 830 million euros ($1.1 billion).
GROWTH MARKET
Ferenc said MOL was ahead of its own target to increase market share. "We wanted 10 percent market share by the end of 2005, and this already puts us ahead."
Raiffeisen Bank analyst Kornel Sarkadi said MOL's best growth markets were Romania and the former Yugoslavia, which meant the deal was a good strategic fit.
"MOL knows perfectly well how much these assets are worth, and they are not known for overpaying," Sarkadi said.
K&H's Tordai pointed out, however, that MOL's returns on Romanian investments have been low and that MOL has yet to turn an annual profit on its Romanian operation.
"Whereas we calculate Hungarian retail margins around 10 euro cents, that's below 5 cents in Romania, so this acquisition is very much an issue about return on investments," Tordai said.
But Tordai added that with this move, MOL could acquire the critical mass in Romania that would allow it to significantly improve its efficiency indicators.
Ferenc noted that 10-month figures show the Romanian unit would turn an annual profit for 2004.
Posted by Mihai Botea : 11/25/2004 01:13:00 PM
Hungarian oil and gas firm MOL said on Tuesday it will buy Royal Dutch/Shell Group's Romanian fuel distribution business in a deal analysts valued at around $50 million.
The sale includes 59 gasoline filling stations and a smaller lubricants and aviation fuel business, enabling MOL to further expand its retail footprint in central Europe.
For Shell, the sale is the latest in a raft of disposals as the company presses ahead with a $10-12 billion divestment programme that will help fund increased oil and gas exploration.
Shell's Romanian liquefied petroleum gas (LPG) business is not included in the sale. This may be sold as part of the global LPG business of which Shell is also mulling a sale.
With the deal, MOL will have 130 filling stations in Romania, which gives it an 11 to 12 percent market share and makes it the second largest player in the country's fuel market after Petrom, MOL Communications Director Szabolcs Ferenc said.
Analysts said MOL had taken a big step toward meeting its targets. They said the company was known not to overpay.
"The rule of thumb is that each filling station costs $1 million, but I think they paid somewhat less, probably around $50 million for the whole thing," said K&H Equities analyst Peter Tordai.
At 1120 GMT, MOL stock was up 2.6 percent at 11,815 forints ($49.9).
Austria's OMV recently agreed to buy a 51 percent stake in Petrom for a reported 830 million euros ($1.1 billion).
GROWTH MARKET
Ferenc said MOL was ahead of its own target to increase market share. "We wanted 10 percent market share by the end of 2005, and this already puts us ahead."
Raiffeisen Bank analyst Kornel Sarkadi said MOL's best growth markets were Romania and the former Yugoslavia, which meant the deal was a good strategic fit.
"MOL knows perfectly well how much these assets are worth, and they are not known for overpaying," Sarkadi said.
K&H's Tordai pointed out, however, that MOL's returns on Romanian investments have been low and that MOL has yet to turn an annual profit on its Romanian operation.
"Whereas we calculate Hungarian retail margins around 10 euro cents, that's below 5 cents in Romania, so this acquisition is very much an issue about return on investments," Tordai said.
But Tordai added that with this move, MOL could acquire the critical mass in Romania that would allow it to significantly improve its efficiency indicators.
Ferenc noted that 10-month figures show the Romanian unit would turn an annual profit for 2004.
Posted by Mihai Botea : 11/25/2004 01:13:00 PM
A new date has been set to close negotiations for Romania's accession to the EU.
Talks are to be finalized by December 17, after presidential and parliamentarian elections.
was the day when outgoing EU Commissioner for Enlargement Guenter Verheugen said Romania could close accession negotiations.
Moscovici, the new rapporteur, told the parliamentarians about measures Romanian authorities still need to take for press freedom, judicial reform, the fight against corruption and the increasing level of poverty, according to Romanian diplomatic sources.
He also suggested that, besides the report he has to develop before the accession treaty is signed, he should prepare another report on how the country manages to fulfill its engagements.
The Green Group's foreign affairs coordinator, Dutchman Joost Lagendijk, said he is not confident that Romania can complete negotiations this year, because of the problems it has with freedom of speech and high-level corruption.
He added that he does not oppose Romania's integration, but the EU must be as critical with the country as they were with other candidates.
The European Commission's enlargement director, Mathias Ruete, said that Romania has made some progress lately that the Commission was not even expecting.
Foreign affairs commission president Elmar Brok announced the negotiation schedule for 2005.
The first debate for the development of the new reports for Romania and Bulgaria will take place in January 2005, the formal approval for signing the treaty will be given in April, and the Treaty will be signed on May 9.
Both Puscas and the new Commissioner for Enlargement, Olli Rehn, said they hope negotiations will be closed before the next EU summit to be held on December 17.
Rehn said in an interview for the BBC that "both Romania and the EC have to make efforts" to close the negotiation before the EU summit, but refused to say if the accession talks could be closed this month.
Puscas said Romania is negotiating "very difficult issues" these days, but he hopes talks could be finalized by December 17.
Posted by Iulia Stoicescu : 11/25/2004 01:07:00 PM
Talks are to be finalized by December 17, after presidential and parliamentarian elections.
was the day when outgoing EU Commissioner for Enlargement Guenter Verheugen said Romania could close accession negotiations.
Moscovici, the new rapporteur, told the parliamentarians about measures Romanian authorities still need to take for press freedom, judicial reform, the fight against corruption and the increasing level of poverty, according to Romanian diplomatic sources.
He also suggested that, besides the report he has to develop before the accession treaty is signed, he should prepare another report on how the country manages to fulfill its engagements.
The Green Group's foreign affairs coordinator, Dutchman Joost Lagendijk, said he is not confident that Romania can complete negotiations this year, because of the problems it has with freedom of speech and high-level corruption.
He added that he does not oppose Romania's integration, but the EU must be as critical with the country as they were with other candidates.
The European Commission's enlargement director, Mathias Ruete, said that Romania has made some progress lately that the Commission was not even expecting.
Foreign affairs commission president Elmar Brok announced the negotiation schedule for 2005.
The first debate for the development of the new reports for Romania and Bulgaria will take place in January 2005, the formal approval for signing the treaty will be given in April, and the Treaty will be signed on May 9.
Both Puscas and the new Commissioner for Enlargement, Olli Rehn, said they hope negotiations will be closed before the next EU summit to be held on December 17.
Rehn said in an interview for the BBC that "both Romania and the EC have to make efforts" to close the negotiation before the EU summit, but refused to say if the accession talks could be closed this month.
Puscas said Romania is negotiating "very difficult issues" these days, but he hopes talks could be finalized by December 17.
Posted by Iulia Stoicescu : 11/25/2004 01:07:00 PM
Wednesday, November 24, 2004
A Bulgarian company and a Romanian one have remained in the race for buying Dobromin Constanta after one of the bidders retired and another was rejected by the negotiation commission within AVAS. According to an AVAS release, the commission decided after the pre-qualification stage to continue the negotiations with Alfa Kaolin Bulgaria and the corporation comprising Metaleuroest Cimpina, Constanta Mineral Employees’ Association, Elsid Titu and the individual Gabriela Serban.
Posted by Mihai Botea : 11/24/2004 04:51:00 PM
Posted by Mihai Botea : 11/24/2004 04:51:00 PM
source: InvestRomania
Japan Bank for International Cooperation (JBIC) said it would release a USD 200 million loan to Romanian power plant Turceni to finance sulphur dioxide emissions reduction project.
The 30-year loan has a 10-year grace period and 0.75% per year interest rate, Romania’s Industry Ministry said.
JBIC is financing several other projects in Romanian energy sector. Companies like Itiochu, Hitachi and Toshiba are involved in upgrading projects for Romanian power plants.
Posted by Mihai Botea : 11/24/2004 04:48:00 PM
Japan Bank for International Cooperation (JBIC) said it would release a USD 200 million loan to Romanian power plant Turceni to finance sulphur dioxide emissions reduction project.
The 30-year loan has a 10-year grace period and 0.75% per year interest rate, Romania’s Industry Ministry said.
JBIC is financing several other projects in Romanian energy sector. Companies like Itiochu, Hitachi and Toshiba are involved in upgrading projects for Romanian power plants.
Posted by Mihai Botea : 11/24/2004 04:48:00 PM
source: Fast Company.
The Financial Times and Pricewaterhouse Coopers has just published a list of the ten most respected business leaders today.
1. Bill Gates (Microsoft)
2. Jack Welch (GE)
3. Carlos Ghosn (Nissan)
4. Warren Buffett (Berkshire Hathaway)
5. Michael Dell (Dell Computer)
6. Hiroshi Okuda (Toyota)
7. Jeff Immelt (GE)
8. Carly Fiorina (HP)
9. Steve Jobs (Apple)
10. Fujio Mitarai (Canon)
We welcome all our visitors to comment on this list and make proposals about who they would vote for being here, in the top 10 business leaders.
Posted by Mihai Botea : 11/24/2004 10:20:00 AM
The Financial Times and Pricewaterhouse Coopers has just published a list of the ten most respected business leaders today.
1. Bill Gates (Microsoft)
2. Jack Welch (GE)
3. Carlos Ghosn (Nissan)
4. Warren Buffett (Berkshire Hathaway)
5. Michael Dell (Dell Computer)
6. Hiroshi Okuda (Toyota)
7. Jeff Immelt (GE)
8. Carly Fiorina (HP)
9. Steve Jobs (Apple)
10. Fujio Mitarai (Canon)
We welcome all our visitors to comment on this list and make proposals about who they would vote for being here, in the top 10 business leaders.
Posted by Mihai Botea : 11/24/2004 10:20:00 AM
Renault has selected the Indian company Mahindra & Mahindra to support its first foray into India's passenger car market, according to people close to the Mumbai-based tractor and sports utility vehicle maker.
Their joint venture will build the Logan, a low-cost vehicle developed by Renault for emerging markets, which Renault believes it must penetrate to sustain ambitious volume-growth targets.
Mahindra has 40 per cent of the utility market. Renault's move will expand Mahindra's partnership with Renault, for which it already supplies petrol engines.
The Pitesti-based company Automobile Dacia started selling the Logan in September in Romania.
Renault officials announced later the car is also planned to be sold in most of the Western European countries as of the first half of 2005.
Furthermore, the Logan is expected to hit other markets, such as Russia, Columbia, Morocco and Iran.
According to Renault estimates, the Romanian car model would be produced in 700,000 units by 2010.
Posted by Iulia Stoicescu : 11/24/2004 10:10:00 AM
Their joint venture will build the Logan, a low-cost vehicle developed by Renault for emerging markets, which Renault believes it must penetrate to sustain ambitious volume-growth targets.
Mahindra has 40 per cent of the utility market. Renault's move will expand Mahindra's partnership with Renault, for which it already supplies petrol engines.
The Pitesti-based company Automobile Dacia started selling the Logan in September in Romania.
Renault officials announced later the car is also planned to be sold in most of the Western European countries as of the first half of 2005.
Furthermore, the Logan is expected to hit other markets, such as Russia, Columbia, Morocco and Iran.
According to Renault estimates, the Romanian car model would be produced in 700,000 units by 2010.
Posted by Iulia Stoicescu : 11/24/2004 10:10:00 AM
The Paris Club decision last Sunday, to write off 80% of Iraq's debts, is not valid for Romania.
Foreign Affairs Minister Mircea Geoana on Tuesday said the debt write off procedure "does not apply to Romania," which is not a member of the Club.
In addition, Prime Minister Adrian Nastase said Iraq has plenty of resources to cover its debts. "Iraq is not a poor resource country. We understand it cannot pay its debts now," Nastase stated, adding the issue could be solved by applying a new maturity term for the $2.5 billion debt.
Iraq owes Romania $1.7 billion, to which it adds interests, thus boosting the amount to be recovered to $2.5 billion (1.913 billion euros).
The debt dates back to the Communist rule of Nicolae Ceausescu, who had strong ties to Saddam Hussein.
The figure now accounts for some 3% of Romania's Gross Domestic Product (GDP), estimated at 55 billion euros this year.
The Paris Club of 19 creditor countries, including the United States, Japan, Russia and EU nations, on Sunday said its members had agreed to wipe out 80 percent of the money it is owed by Iraq over three years.
Iraq owes the Paris Club nations some $40 billion (30 billion euros), which is about a third of the country's total foreign debt ($125 billion).
Posted by Iulia Stoicescu : 11/24/2004 10:02:00 AM
Foreign Affairs Minister Mircea Geoana on Tuesday said the debt write off procedure "does not apply to Romania," which is not a member of the Club.
In addition, Prime Minister Adrian Nastase said Iraq has plenty of resources to cover its debts. "Iraq is not a poor resource country. We understand it cannot pay its debts now," Nastase stated, adding the issue could be solved by applying a new maturity term for the $2.5 billion debt.
Iraq owes Romania $1.7 billion, to which it adds interests, thus boosting the amount to be recovered to $2.5 billion (1.913 billion euros).
The debt dates back to the Communist rule of Nicolae Ceausescu, who had strong ties to Saddam Hussein.
The figure now accounts for some 3% of Romania's Gross Domestic Product (GDP), estimated at 55 billion euros this year.
The Paris Club of 19 creditor countries, including the United States, Japan, Russia and EU nations, on Sunday said its members had agreed to wipe out 80 percent of the money it is owed by Iraq over three years.
Iraq owes the Paris Club nations some $40 billion (30 billion euros), which is about a third of the country's total foreign debt ($125 billion).
Posted by Iulia Stoicescu : 11/24/2004 10:02:00 AM
Tuesday, November 23, 2004
Dragos has a very interesting post with a link from where you can download the latest overview of Romania's macroeconomic landscape.
Thank Dragos !
Posted by Mihai Botea : 11/23/2004 04:35:00 PM
Thank Dragos !
Posted by Mihai Botea : 11/23/2004 04:35:00 PM
The Romanian TV channel Relaitatea TV and CNN International signed a broadcasting partnership. This partnership is the first of its kind and opens new doors to Romanian media.
The partnership states that Realitatea TV will upgrade its schedule by offering a Breaking News section similar to the CNN one. Even more, Realitatea TV will use transmissions from CNN reporters worldwide in order to have a better coverage of international events.
The Realitatea TV reporters will be trained in the famous IPP (International Professional Program) program developed by CNN and they will have the chance to learn about the most professional methods used by CNN reporters.
Posted by Mihai Botea : 11/23/2004 01:21:00 PM
The partnership states that Realitatea TV will upgrade its schedule by offering a Breaking News section similar to the CNN one. Even more, Realitatea TV will use transmissions from CNN reporters worldwide in order to have a better coverage of international events.
The Realitatea TV reporters will be trained in the famous IPP (International Professional Program) program developed by CNN and they will have the chance to learn about the most professional methods used by CNN reporters.
Posted by Mihai Botea : 11/23/2004 01:21:00 PM
It appears that some transcripts of internal PSD meetings and discussions have surfaced lately. No need to say, PSD complains that they are not true, and that it is a dirty attack of them, now that elections are very very close.
Call me what you want, but they sound "real" to me. And they are truly, truly dirty.
- Party learders discuss the help that they have received from church leaders last year when the new Constitution of Romania has been voted with "special efforts". They also discuss around the one who did not help them.
- Pragmatic considerations are being made: "if we take 700-800 milion worth of loans and we start to building sites all over the country, on county roads, we'll have no problem winning the elections, at least 80% in rural areas. They have nothing to eat, but if you build a nice road in front of their courtyard, so that they don't have to walk through mud, they're happy."
- Influencing the justice system and directing the files where they can be properly handled is also on the agenda
- Many are complaing that there are newspapers that are against them, or even newspapers that they suppor which happen to write bad PR about them. The same goes for televisions. Measures are being imagined to correct the situation. "This would mean to have people checking the tape saying, , so, to control things. Someone to go sit in the studios, to work with them. We can control these things, but obviously, this is hard work and because we don't want to work, we let them do it their own way... "
More details for the Romanian speakers here...
http://www.evz.ro/topstory/?news_id=172351&PHPSESSID=818a9cf244083a6b606c9daa347d30b6
Posted by TM : 11/23/2004 10:18:00 AM
Call me what you want, but they sound "real" to me. And they are truly, truly dirty.
- Party learders discuss the help that they have received from church leaders last year when the new Constitution of Romania has been voted with "special efforts". They also discuss around the one who did not help them.
- Pragmatic considerations are being made: "if we take 700-800 milion worth of loans and we start to building sites all over the country, on county roads, we'll have no problem winning the elections, at least 80% in rural areas. They have nothing to eat, but if you build a nice road in front of their courtyard, so that they don't have to walk through mud, they're happy."
- Influencing the justice system and directing the files where they can be properly handled is also on the agenda
- Many are complaing that there are newspapers that are against them, or even newspapers that they suppor which happen to write bad PR about them. The same goes for televisions. Measures are being imagined to correct the situation. "This would mean to have people checking the tape saying
More details for the Romanian speakers here...
http://www.evz.ro/topstory/?news_id=172351&PHPSESSID=818a9cf244083a6b606c9daa347d30b6
Posted by TM : 11/23/2004 10:18:00 AM
Monday, November 22, 2004
F1 is looking to stage two more grands prix in Eastern Europe. In 2005, only Hungary will represent the region on the grand prix calendar. But both Romania and Bulgaria have expressed interest in welcoming the travelling circus to town.
A Romanian race may take place in the Arad region, with HOK - the company involved in Arsenal's new football stadium - commissioned to design a track. "There's no reason why we can't have a circuit with as much character as Spa (in Belgium)," said architect Clive Brown.
Up to $100 million may have been put aside for the project by the Romanian government.
Posted by Mihai Botea : 11/22/2004 06:20:00 PM
A Romanian race may take place in the Arad region, with HOK - the company involved in Arsenal's new football stadium - commissioned to design a track. "There's no reason why we can't have a circuit with as much character as Spa (in Belgium)," said architect Clive Brown.
Up to $100 million may have been put aside for the project by the Romanian government.
Posted by Mihai Botea : 11/22/2004 06:20:00 PM
In a recent article in Washington Post, Daniel Williams has a very hard criticism for a Romanian Sitcom called "The Winding Road to Europe".
He considers that the sitcom laughes at EU values and has a very hard opinion on Romania's problems and attitude.
Daniel Williams considers Romania to have a "myriad social ills".
Quite a comprehensive analysis of Romania's social issues can be found in the article.
Posted by Mihai Botea : 11/22/2004 06:14:00 PM
He considers that the sitcom laughes at EU values and has a very hard opinion on Romania's problems and attitude.
Daniel Williams considers Romania to have a "myriad social ills".
Quite a comprehensive analysis of Romania's social issues can be found in the article.
Posted by Mihai Botea : 11/22/2004 06:14:00 PM
Fitch Ratings, the international rating agency, has today upgraded BRD-Groupe Societe Generale's ("BRD") and UniCredit Romania's ("UCR") ratings to Long-term 'BBB-' (BBB minus) from 'BB' and to Short-term 'F3' from 'B'.
At the same time, BRD's and UCR's Support ratings have been changed to '2' from '3'. Following the upgrade, the Outlook is now Stable. The Long-term rating of Banca Comerciala Romana ("BCR") is also upgraded to 'BB+' from 'BB-' (BB minus), while the Support rating of Banc Post has been changed to '2' from '3'.
In addition, the Individual rating of UCR is affirmed at 'D', while BCR's other ratings are affirmed at Short-term 'B', Individual 'D' and Support '3' The Outlook on BCR's Long-term rating remains Stable.
These rating actions reflect yesterday's upgrade of Romania's Long-term foreign currency rating and Country Ceiling to 'BBB-' (BBB minus) from 'BB' and Short-term rating to 'F3' from 'B'. Following the upgrade, the Outlook is now Stable.
The Long-term, Short-term and Support ratings of BRD and UCR reflect the potential support from their foreign parents in case of need. BRD is 51%-owned by Societe Generale, (rated Long-term 'AA-' (AA minus)) and UCR is 99.8%-owned by Unicredito Italiano (rated Long-term 'AA-' (AA minus)).
However, due to the potential transfer risk in Romania, which could constrain the ability of these institutions to support their subsidiaries, BRD's and UCR's Long-term ratings are constrained by Romania's Country Ceiling of 'BBB-' (BBB minus).
BCR's Long-term, Short-term and Support ratings reflect the potential support from the Romanian state if required, given its systemic importance and the 38% stake held by the government. Banc Post's Support Rating reflects the potential support from its 58% shareholder, EFG Eurobank Ergasias (rated Long-term 'A-' (A minus)),
BCR is the largest bank in Romania representing c.33% of total banking assets. BRD is Romania's second largest bank, accounting for c.16% of total banking assets, and has been majority-owned by Societe Generale since 1999.
UCR was a relatively small bank when UniCredito Italiano initially took a stake in it in June 2002. The bank has since undertaken an expansion strategy targeting both corporate and retail clients. EFG Eurobank Ergasias gained a majority stake in Banc Post in November 2003. Since then a major restructuring programme has begun.
Posted by Mihai Botea : 11/22/2004 06:09:00 PM
At the same time, BRD's and UCR's Support ratings have been changed to '2' from '3'. Following the upgrade, the Outlook is now Stable. The Long-term rating of Banca Comerciala Romana ("BCR") is also upgraded to 'BB+' from 'BB-' (BB minus), while the Support rating of Banc Post has been changed to '2' from '3'.
In addition, the Individual rating of UCR is affirmed at 'D', while BCR's other ratings are affirmed at Short-term 'B', Individual 'D' and Support '3' The Outlook on BCR's Long-term rating remains Stable.
These rating actions reflect yesterday's upgrade of Romania's Long-term foreign currency rating and Country Ceiling to 'BBB-' (BBB minus) from 'BB' and Short-term rating to 'F3' from 'B'. Following the upgrade, the Outlook is now Stable.
The Long-term, Short-term and Support ratings of BRD and UCR reflect the potential support from their foreign parents in case of need. BRD is 51%-owned by Societe Generale, (rated Long-term 'AA-' (AA minus)) and UCR is 99.8%-owned by Unicredito Italiano (rated Long-term 'AA-' (AA minus)).
However, due to the potential transfer risk in Romania, which could constrain the ability of these institutions to support their subsidiaries, BRD's and UCR's Long-term ratings are constrained by Romania's Country Ceiling of 'BBB-' (BBB minus).
BCR's Long-term, Short-term and Support ratings reflect the potential support from the Romanian state if required, given its systemic importance and the 38% stake held by the government. Banc Post's Support Rating reflects the potential support from its 58% shareholder, EFG Eurobank Ergasias (rated Long-term 'A-' (A minus)),
BCR is the largest bank in Romania representing c.33% of total banking assets. BRD is Romania's second largest bank, accounting for c.16% of total banking assets, and has been majority-owned by Societe Generale since 1999.
UCR was a relatively small bank when UniCredito Italiano initially took a stake in it in June 2002. The bank has since undertaken an expansion strategy targeting both corporate and retail clients. EFG Eurobank Ergasias gained a majority stake in Banc Post in November 2003. Since then a major restructuring programme has begun.
Posted by Mihai Botea : 11/22/2004 06:09:00 PM
Saint-Gobain's Reinforcements Branch has just finalized the acquisition of 90% of the stock of Rompolimer, a Romanian company specializing in the distribution of materials for composites.
Based in Arad, western Romania, near the Hungarian border, Rompolimer reports annual sales of more than 4 million euros, and employs 17 people at its four depots. In addition to controlling access to the Romanian composites market, this acquisition is an opportunity to grow Saint-Gobain Vetrotex's sales in the countries surrounding Romania where the company is relatively inactive at present.
Following its acquisition, Rompolimer has been placed under Distribution Eastern Europe.
Saint-Gobain's plans include a 40 milion investment in building a new plant near Ploiesti.
Posted by Mihai Botea : 11/22/2004 11:37:00 AM
Based in Arad, western Romania, near the Hungarian border, Rompolimer reports annual sales of more than 4 million euros, and employs 17 people at its four depots. In addition to controlling access to the Romanian composites market, this acquisition is an opportunity to grow Saint-Gobain Vetrotex's sales in the countries surrounding Romania where the company is relatively inactive at present.
Following its acquisition, Rompolimer has been placed under Distribution Eastern Europe.
Saint-Gobain's plans include a 40 milion investment in building a new plant near Ploiesti.
Posted by Mihai Botea : 11/22/2004 11:37:00 AM
The main short-term risks hanging over the budget are related to the widening of the current account deficit and to the arrears trend.
The pension system and the ability to absorb EU funds also pose problems for the budget, according to Romania's Pre-Accession Economic Program for 2004.
The current account deficit, even if it does not have a deep structural imbalance, can be troublesome in the medium term in terms of the foreign sustainability, the report said.
Exports - chiefly orientated towards the European Union - grew at a faster pace than imports, which were chiefly of consumer goods.
The gap between the level imports and exports remains at a worryingly large level.
Strong aggregated demand is supported by the increase in lower-to-average wage levels in the economy and the credit and the investments boom.
Foreign direct investments (FDI) went up by 44% in the first half of 2004 as compared to the year-ago period and accounted for 1.164 billion euros, while the estimates for the whole 2004 forecast FDI to exceed 2 billion euros, the highest level in 15 years.
Higher international oil prices are an additional driver that could have a negative impact on the current account deficit due to their influence on energy imports.
Arrears remain a major problem for the Romanian economy, although they fell several percentage points of GDP over the last couple of years.
Thus, the arrears fell from 38.3% of GDP in 2002 to 33.6% in 2003.
The general consolidated budget saw this index lose weight in the state and mixed owned companies, following reorganization measures, privatizations and reforms in the power sector, the report reveals.
In the overall economy, companies' debts to each other fell from 17.2% of GDP in 2002 to 14.9% in 2003.
Meanwhile, arrears in the general consolidated budget dropped from 13.5% to 12% of GDP.
The social insurance budget had to recover less money in 2003, and therefore its weighting in GDP fell from 5.8% in 2002 to 5.2% last year.
During 2004, local authorities strengthened bankruptcy regulations for indebted companies.
However, the report said that slowing the implementation of these measures would only turn arrears in to a major risk for the Romanian economy, as they would constantly put pressure aggregate demand, inflation and the current account.
Another major risk facing Romania's budget is the financial situation of state pensions in the public sector, currently paid to some 6.1 million pensioners.
The pension system amounted to an average of 7.2% of GDP between 1995 and 2003. One of the main reasons for the increase in the pension system deficits was the rapid rise in the number of beneficiaries after 1990.
Between 1990 and 2002, the number of pensioners in Romania jumped from 3.4 million to 6.2 million.
The number is expected to drop slightly to 6.1 million pensioners this year.
The report also covers measures initiated by authorities this year concerning pensions. In 2004, the Parliament passed the law concerning the private pension system, but the bill will not become effective until 2006.
Posted by Iulia Stoicescu : 11/22/2004 11:09:00 AM
The pension system and the ability to absorb EU funds also pose problems for the budget, according to Romania's Pre-Accession Economic Program for 2004.
The current account deficit, even if it does not have a deep structural imbalance, can be troublesome in the medium term in terms of the foreign sustainability, the report said.
Exports - chiefly orientated towards the European Union - grew at a faster pace than imports, which were chiefly of consumer goods.
The gap between the level imports and exports remains at a worryingly large level.
Strong aggregated demand is supported by the increase in lower-to-average wage levels in the economy and the credit and the investments boom.
Foreign direct investments (FDI) went up by 44% in the first half of 2004 as compared to the year-ago period and accounted for 1.164 billion euros, while the estimates for the whole 2004 forecast FDI to exceed 2 billion euros, the highest level in 15 years.
Higher international oil prices are an additional driver that could have a negative impact on the current account deficit due to their influence on energy imports.
Arrears remain a major problem for the Romanian economy, although they fell several percentage points of GDP over the last couple of years.
Thus, the arrears fell from 38.3% of GDP in 2002 to 33.6% in 2003.
The general consolidated budget saw this index lose weight in the state and mixed owned companies, following reorganization measures, privatizations and reforms in the power sector, the report reveals.
In the overall economy, companies' debts to each other fell from 17.2% of GDP in 2002 to 14.9% in 2003.
Meanwhile, arrears in the general consolidated budget dropped from 13.5% to 12% of GDP.
The social insurance budget had to recover less money in 2003, and therefore its weighting in GDP fell from 5.8% in 2002 to 5.2% last year.
During 2004, local authorities strengthened bankruptcy regulations for indebted companies.
However, the report said that slowing the implementation of these measures would only turn arrears in to a major risk for the Romanian economy, as they would constantly put pressure aggregate demand, inflation and the current account.
Another major risk facing Romania's budget is the financial situation of state pensions in the public sector, currently paid to some 6.1 million pensioners.
The pension system amounted to an average of 7.2% of GDP between 1995 and 2003. One of the main reasons for the increase in the pension system deficits was the rapid rise in the number of beneficiaries after 1990.
Between 1990 and 2002, the number of pensioners in Romania jumped from 3.4 million to 6.2 million.
The number is expected to drop slightly to 6.1 million pensioners this year.
The report also covers measures initiated by authorities this year concerning pensions. In 2004, the Parliament passed the law concerning the private pension system, but the bill will not become effective until 2006.
Posted by Iulia Stoicescu : 11/22/2004 11:09:00 AM
Prime Minister Adrian Nastase on Saturday said the latest data from The National Statistics Institute indicated a full-year economic growth of 8.1%.
"This is absolutely extraordinary, I can't believe it! I'm looking forward for the final figures. We started the year with a five percent projection, then we recalculated it at six percent, and then at seven percent."
A few weeks ago, it looked like it was going to be 7.6 percent and now estimates for the first nine months indicate a full-year growth of eight percent. It's incredible!..." PM Nastase said enthusiastically.
Economists Matei Paun and Daniel Daianu on the other hand are not too impressed as they believe this year's record-high crop accounted for at least 2% of that 8%, which is not going to happen again next year.
Posted by Iulia Stoicescu : 11/22/2004 10:25:00 AM
"This is absolutely extraordinary, I can't believe it! I'm looking forward for the final figures. We started the year with a five percent projection, then we recalculated it at six percent, and then at seven percent."
A few weeks ago, it looked like it was going to be 7.6 percent and now estimates for the first nine months indicate a full-year growth of eight percent. It's incredible!..." PM Nastase said enthusiastically.
Economists Matei Paun and Daniel Daianu on the other hand are not too impressed as they believe this year's record-high crop accounted for at least 2% of that 8%, which is not going to happen again next year.
Posted by Iulia Stoicescu : 11/22/2004 10:25:00 AM
The Romanian Tourism Ministry said on Friday it expects tourism receipts to increase 14% this year, to $800 million (614 million euro).
The number of tourists registered at hotels or other places offering lodging is estimated to reach 5.9 million, compared to 5.1 million in 2003, the ministry said in a statement.
Of the overnight visitors, 1.6 million are estimated to be foreigners, representing a 45% increase in their numbers.
Romania should attract 6.5 million foreign visitors, including business travellers and daytrippers, this year. That's an increase of 16%.
Romania's mountain resorts should attract 1.4 million tourists, up 29% on the year. The second most-favoured destination are the country's spas, which should draw 1.1 million tourists. The Danube delta and seaside are other hotspots.
Romania opened 120 hotels this year and renovated another 50.
Romania has received 68 million euro through 2006 to build or modernise boarding houses and increase recreation in rural areas, under the European Union's pre-accession programme SAPARD. This year, 500 boarding houses were built in rural areas.
The tourism sector is expected to contribute approximately four percent of Romania's gross domestic product in 2004, up from 3.5% last year.
Investments in the sector may rise up to 400 million euro this year, double the 2003 amount, according to ANT, the government agency in charge of tourism.
Posted by Mihai Botea : 11/22/2004 09:59:00 AM
The number of tourists registered at hotels or other places offering lodging is estimated to reach 5.9 million, compared to 5.1 million in 2003, the ministry said in a statement.
Of the overnight visitors, 1.6 million are estimated to be foreigners, representing a 45% increase in their numbers.
Romania should attract 6.5 million foreign visitors, including business travellers and daytrippers, this year. That's an increase of 16%.
Romania's mountain resorts should attract 1.4 million tourists, up 29% on the year. The second most-favoured destination are the country's spas, which should draw 1.1 million tourists. The Danube delta and seaside are other hotspots.
Romania opened 120 hotels this year and renovated another 50.
Romania has received 68 million euro through 2006 to build or modernise boarding houses and increase recreation in rural areas, under the European Union's pre-accession programme SAPARD. This year, 500 boarding houses were built in rural areas.
The tourism sector is expected to contribute approximately four percent of Romania's gross domestic product in 2004, up from 3.5% last year.
Investments in the sector may rise up to 400 million euro this year, double the 2003 amount, according to ANT, the government agency in charge of tourism.
Posted by Mihai Botea : 11/22/2004 09:59:00 AM
Friday, November 19, 2004
Snack Ventures Europe (SVE), a joint-venture between soft drinks producer PepsiCo and milling and bakery industry player General Mills (US), has bought the leading distributor of snacks on the Romanian market, Star Foods, which was previously Greek-owned. Industry sources say the deal was worth 20 million euros.
Star Foods last year made 40 million euros in turnover. Officials from Star Foods confirmed that the deal had been closed and that changes at the top of the company ladder had already been made.
"This is a solid and well structured business that has a tremendous potential. This gives a significant strategic platform for us to serve our clients in Romania and in the entire Balkan area," said Mike White, the PepsiCo International chairman. White said the acquisition would provide SVE with a foothold in Romania, the largest market in the Balkans, which is characterised by a fast growth.
Star Foods owns a factory in Popesti-Leordeni near Bucharest that has a staff of 850 people. It has four warehouses around the country: in Timisoara, Bacau, Constanta and Cluj. Star Foods makes potato chips (branded as Star Chips), maize flakes (branded as MR. Snacki) and maize & tomato chips (branded as Krax). The company also distributes the Chipita products on the Romanian market: Flipper (Fiesta), Gallina Blanca, Axxon and Tip Top (the Conty line).
Market research company MEMRB surveys for the April-May 2004 period show that Star Foods accounts for 64 percent of the chips market, 28 percent of the snacks market, and 53 percent of the extruded foods market.
The company completed an investment of over one million euros this year, which involved boosting its production capacity. It can now make 3,300 tonnes of chips and 3,300 tonnes of snacks a year. Total investments made in the Popesti-Leordeni facility are in excess of 15 million euros. Star Foods is part of the Mitzalis international group, which deals in production and distribution of consumer foods.
Posted by Mihai Botea : 11/19/2004 03:46:00 PM
Star Foods last year made 40 million euros in turnover. Officials from Star Foods confirmed that the deal had been closed and that changes at the top of the company ladder had already been made.
"This is a solid and well structured business that has a tremendous potential. This gives a significant strategic platform for us to serve our clients in Romania and in the entire Balkan area," said Mike White, the PepsiCo International chairman. White said the acquisition would provide SVE with a foothold in Romania, the largest market in the Balkans, which is characterised by a fast growth.
Star Foods owns a factory in Popesti-Leordeni near Bucharest that has a staff of 850 people. It has four warehouses around the country: in Timisoara, Bacau, Constanta and Cluj. Star Foods makes potato chips (branded as Star Chips), maize flakes (branded as MR. Snacki) and maize & tomato chips (branded as Krax). The company also distributes the Chipita products on the Romanian market: Flipper (Fiesta), Gallina Blanca, Axxon and Tip Top (the Conty line).
Market research company MEMRB surveys for the April-May 2004 period show that Star Foods accounts for 64 percent of the chips market, 28 percent of the snacks market, and 53 percent of the extruded foods market.
The company completed an investment of over one million euros this year, which involved boosting its production capacity. It can now make 3,300 tonnes of chips and 3,300 tonnes of snacks a year. Total investments made in the Popesti-Leordeni facility are in excess of 15 million euros. Star Foods is part of the Mitzalis international group, which deals in production and distribution of consumer foods.
Posted by Mihai Botea : 11/19/2004 03:46:00 PM
Prime Minister Adrian Nastase leads in the polls with 41 percent of the people saying they would vote for him on November 28 elections, according to new opinion polls conducted by Data Media and IRSOP for Greenberg Carville Shrum (GCS), an international political consulting group handling the Social Democrat - Humanist (PSD+PUR) campaign.
Opposition leader Traian Basescu is the second runner, having the vote of 32 percent of the electorate, said the polls yesterday.
The two main party coalitions are six percent apart, with the PSD+PUR Union leading the race with 40 percent.
The leader of the Greater Romania Party (PRM) Corneliu Vadim Tudor comes in third in the presidential race, and his party scores equal points in the parliament race as well - 13 percent, the survey says.
The polls were conducted of almost 3,000 eligible voters across the country.
Posted by Iulia Stoicescu : 11/19/2004 03:38:00 PM
Opposition leader Traian Basescu is the second runner, having the vote of 32 percent of the electorate, said the polls yesterday.
The two main party coalitions are six percent apart, with the PSD+PUR Union leading the race with 40 percent.
The leader of the Greater Romania Party (PRM) Corneliu Vadim Tudor comes in third in the presidential race, and his party scores equal points in the parliament race as well - 13 percent, the survey says.
The polls were conducted of almost 3,000 eligible voters across the country.
Posted by Iulia Stoicescu : 11/19/2004 03:38:00 PM
President Ion Iliescu who is going to be back as president of the Social Democratic Party after his term ends on the November 28, made several controversial declarations in the past few days, setting both opposition and journalists on fire.
Iliescu said two days ago that the issue of paying Rafo debts with taxpayers' money is "fiddlesticks."
"Everything is from the taxpayers. Stop bringing up such nonsense as 'with the tax payers' money'. Anything is from the budget, any state effort is with money from taxpayers, but this is how you build the country, this is how you build national economy - through the contribution of taxpayers. Why do you come up with such theories?!"
Earlier this week, when journalists asked him if it was legal for the president to get involved in the elections campaign, as he is supposed to be neutral, Iliescu responded, "I'm not Switzerland!"
During his visit in Calarasi County, he criticized the locals for voting for the Liberal Democratic Alliance in the local elections this summer.
And yesterday, while visiting the town of Cimpina, Iliescu said he doesn't care about the media criticizing him, "The dogs bark and the caravan passes."
The president was apparently referring to a recent article that appeared in one of the national newspapers and included an alleged transcript of a private conversation Iliescu had with Russian former president Mihail Gorbachev in 1991.
Iliescu said he is no longer impressed by what the press writes about him and referred to such stories as folly and nonsense.
During his visit to Cimpina, where he was accompanied by the local parliament candidates of the Social Democratic-Humanist (PSD+PUR) Union, Iliescu met with local pensioners and told them that the man who will be elected head of state must be a balanced, clear-thinking person who understands well international relations.
Romanian Press Club president Cristian Tudor Popescu said, "Dogs not only bark, they also bite. And the caravan is not the only one passing. Time is also passing, and that the president will soon see."
Journalist Ion Cristoiu said he, as a journalist, is not offended by Iliescu's words, "It's his right to care or not to care about what the media says. If he thinks he will not need the media, when he becomes PSD president, it's his business."
Cristoiu also added his own version of the popular saying,"Politicians bark, journalist go ahead."
Liviu Mihaiu, journalist at the weekly Academia Catavencu said, "With all due respect we owe our president, I think Ion Iliescu understands democracy as much as his barber does. Anyway, Iliescu is a historic notion that you just can't comment on."
Academia Catavencu journalist and head of the Media Monitoring Agency, Mircea Toma rephrased Iliescu's words saying "the media barks, the poor and honest president passes, but he's pulling along a pack of greedy people, who have reached a degree of opulence beyond imagination."
Posted by Iulia Stoicescu : 11/19/2004 03:29:00 PM
Iliescu said two days ago that the issue of paying Rafo debts with taxpayers' money is "fiddlesticks."
"Everything is from the taxpayers. Stop bringing up such nonsense as 'with the tax payers' money'. Anything is from the budget, any state effort is with money from taxpayers, but this is how you build the country, this is how you build national economy - through the contribution of taxpayers. Why do you come up with such theories?!"
Earlier this week, when journalists asked him if it was legal for the president to get involved in the elections campaign, as he is supposed to be neutral, Iliescu responded, "I'm not Switzerland!"
During his visit in Calarasi County, he criticized the locals for voting for the Liberal Democratic Alliance in the local elections this summer.
And yesterday, while visiting the town of Cimpina, Iliescu said he doesn't care about the media criticizing him, "The dogs bark and the caravan passes."
The president was apparently referring to a recent article that appeared in one of the national newspapers and included an alleged transcript of a private conversation Iliescu had with Russian former president Mihail Gorbachev in 1991.
Iliescu said he is no longer impressed by what the press writes about him and referred to such stories as folly and nonsense.
During his visit to Cimpina, where he was accompanied by the local parliament candidates of the Social Democratic-Humanist (PSD+PUR) Union, Iliescu met with local pensioners and told them that the man who will be elected head of state must be a balanced, clear-thinking person who understands well international relations.
Romanian Press Club president Cristian Tudor Popescu said, "Dogs not only bark, they also bite. And the caravan is not the only one passing. Time is also passing, and that the president will soon see."
Journalist Ion Cristoiu said he, as a journalist, is not offended by Iliescu's words, "It's his right to care or not to care about what the media says. If he thinks he will not need the media, when he becomes PSD president, it's his business."
Cristoiu also added his own version of the popular saying,"Politicians bark, journalist go ahead."
Liviu Mihaiu, journalist at the weekly Academia Catavencu said, "With all due respect we owe our president, I think Ion Iliescu understands democracy as much as his barber does. Anyway, Iliescu is a historic notion that you just can't comment on."
Academia Catavencu journalist and head of the Media Monitoring Agency, Mircea Toma rephrased Iliescu's words saying "the media barks, the poor and honest president passes, but he's pulling along a pack of greedy people, who have reached a degree of opulence beyond imagination."
Posted by Iulia Stoicescu : 11/19/2004 03:29:00 PM
The general consolidated budget accounted for 5,882 billion ROL at the end of September, thus attaining 0.3% of the Gross Domestic Product (GDP), slightly up from 0.2% the eight month result, the Finance Ministry said in a release.
In September, the difference between the expenditures and the revenues in the consolidated budget went up by 1,844 billion ROL.
In the January-September period, the negative balance of the state budget hit 7,805 billion ROL, down by 1,584 billion ROL as compared to August this year.
The revenues collected by the general budget represent 74.5% of the annual estimates, namely 509.106 billion ROL.
Compared to the nine months in 2003, this year's budget revenues rose by 25.7%, in nominal terms, 0.8% of GDP.
Posted by Iulia Stoicescu : 11/19/2004 03:25:00 PM
In September, the difference between the expenditures and the revenues in the consolidated budget went up by 1,844 billion ROL.
In the January-September period, the negative balance of the state budget hit 7,805 billion ROL, down by 1,584 billion ROL as compared to August this year.
The revenues collected by the general budget represent 74.5% of the annual estimates, namely 509.106 billion ROL.
Compared to the nine months in 2003, this year's budget revenues rose by 25.7%, in nominal terms, 0.8% of GDP.
Posted by Iulia Stoicescu : 11/19/2004 03:25:00 PM
The American company, General Electric, will open a thermal power plant next year in Piatra Neamt.
The plant will supply power to the Darmanesti neighborhood - with the possibility to later extend the project to the entire town.
The project was analyzed on Wednesday by the Piatra Neamt mayor Gheorghe Stefan, General Electric's general manager for southeastern Europe, Dan Ionescu, and by the state secretary with the Ministry of Economy and Commerce, Iulian Iancu.
Iancu said that the thermal power produced by the Darmanesti plant will be supplied to consumers at prices two times lower than the cost of apartment heating systems.
Posted by Iulia Stoicescu : 11/19/2004 03:21:00 PM
The plant will supply power to the Darmanesti neighborhood - with the possibility to later extend the project to the entire town.
The project was analyzed on Wednesday by the Piatra Neamt mayor Gheorghe Stefan, General Electric's general manager for southeastern Europe, Dan Ionescu, and by the state secretary with the Ministry of Economy and Commerce, Iulian Iancu.
Iancu said that the thermal power produced by the Darmanesti plant will be supplied to consumers at prices two times lower than the cost of apartment heating systems.
Posted by Iulia Stoicescu : 11/19/2004 03:21:00 PM
Thursday, November 18, 2004
A very promising report came from Ficth Ratings yesterday. In the repport, Romania has been upgraded to Investment Grade by upgrading the foreign currency and local currency ratings. Romania's outlook has been promoted to Stable.
Please find more details below, in the original Fitch Ratings Press Release.
source: Fitch Ratings-London-17 November 2004
Fitch Ratings, the international rating agency, has today upgraded Romania's Long-term foreign currency and local currency sovereign ratings to 'BBB-' (BBB minus) and 'BBB' respectively, from 'BB' and 'BB+'. At the same time, the Short-term rating and Country Ceiling are upgraded to 'F3' from 'B' and to 'BBB-' (BBB minus) from 'BB,' respectively. Following the upgrade, the Outlook is now Stable.
The upgrade is supported by Romania's prudent fiscal policy, advances on key structural reforms and good prospects on European Union (EU) accession. Most key public debt sustainability indicators compare favourably with rating peers' and should continue to improve over the next two to three years. Policy discipline seems to be more firmly anchored than was the case two years ago, and the government's structural reform record is now arguably ahead of or at least equal to many rating peers'. Policy will remain guided by a new IMF programme scheduled to run until July 2006, and the exacting requirements of EU accession, which Fitch expects to occur in January 2007. In the agency's opinion, this is unlikely to be disrupted by the parliamentary and presidential elections scheduled for late November 2004.
"EU accession remains a big driver of policy discipline and hence improving creditworthiness," according to Nick Eisinger, lead analyst for Romania at Fitch's Sovereigns team. Important breakthroughs in energy reform and privatisations have earned Romania the 'functioning market economy' status from the EU and kept the January 2007 accession date on track. There will be more focus on the implementation of the chapters following the inclusion of 'safeguard clauses' to the accession process, and in some areas considerable efforts will be needed to conclude negotiations. However, Fitch does not envisage any major problems to emerge. In fact, the inclusion of the 'safeguard clauses' should help maintain reform momentum.
Strong GDP growth (7.5%) in 2004 is bolstering budget revenues, and has allowed the government to make two downward adjustments to its budget deficit target, now set at 1.6% GDP. Growth will slow in 2005, but still remains respectable and broadly supportive of ongoing fiscal discipline. A series of tax cuts are outlined for 2005, while there are also a number of potential strains on government spending, especially on public wages. However, the tax base should widen while efforts are being made to reduce subsidies, so the official 1.5% GDP deficit target is unlikely to be overshot by very much. Narrow budget deficits, together with robust GDP growth, a strong exchange rate and solid privatisation revenues, are supporting favourable public debt dynamics. General government debt (including guarantees) is forecast to end 2004 equivalent to around 24% GDP, and should continue to fall gradually during 2005 and 2006.
Strong investment-led growth has been driving up the current account deficit, forecast at 6% of GDP in 2004. Fitch expects further widening of the current account deficit in 2005-2006 to around 6.5% GDP per year. While this imbalance will need monitoring, Fitch is not overly concerned at this stage. Romania continues to generate large balance of payments surpluses, building foreign reserves and keeping a lid on net external debt, forecast at some 19% GDP at end-2004. Foreign direct investment-coverage of the current account deficit currently stands at around 60% and should increase, while much of the external imbalance is being driven by investment, as opposed to consumption. As capital account liberalisation is pursued in 2005 an increase in short term debt inflows is probable. Fitch expects short term external debt to rise to 19% of total debt at end-2005 (17% in 2004) and to 21% of total at end-2006. However, overall gross external debt should remain at its end-2004 forecast of around 38% of GDP for the next couple of years.
Developments in the banking system will also need monitoring given the rapid pace of credit expansion seen in the past two years. Non-performing loans are low at present, but could rise further down the credit cycle. The banking system has increased its external borrowing in order to finance FX-linked domestic loan growth, which has grown rapidly this year. Fitch highlights that the counterparts of much of this loan growth do not necessarily have hard currency revenue streams, which leaves the banking system exposed to an exchange rate shock
Posted by Mihai Botea : 11/18/2004 02:14:00 PM
Please find more details below, in the original Fitch Ratings Press Release.
source: Fitch Ratings-London-17 November 2004
Fitch Ratings, the international rating agency, has today upgraded Romania's Long-term foreign currency and local currency sovereign ratings to 'BBB-' (BBB minus) and 'BBB' respectively, from 'BB' and 'BB+'. At the same time, the Short-term rating and Country Ceiling are upgraded to 'F3' from 'B' and to 'BBB-' (BBB minus) from 'BB,' respectively. Following the upgrade, the Outlook is now Stable.
The upgrade is supported by Romania's prudent fiscal policy, advances on key structural reforms and good prospects on European Union (EU) accession. Most key public debt sustainability indicators compare favourably with rating peers' and should continue to improve over the next two to three years. Policy discipline seems to be more firmly anchored than was the case two years ago, and the government's structural reform record is now arguably ahead of or at least equal to many rating peers'. Policy will remain guided by a new IMF programme scheduled to run until July 2006, and the exacting requirements of EU accession, which Fitch expects to occur in January 2007. In the agency's opinion, this is unlikely to be disrupted by the parliamentary and presidential elections scheduled for late November 2004.
"EU accession remains a big driver of policy discipline and hence improving creditworthiness," according to Nick Eisinger, lead analyst for Romania at Fitch's Sovereigns team. Important breakthroughs in energy reform and privatisations have earned Romania the 'functioning market economy' status from the EU and kept the January 2007 accession date on track. There will be more focus on the implementation of the chapters following the inclusion of 'safeguard clauses' to the accession process, and in some areas considerable efforts will be needed to conclude negotiations. However, Fitch does not envisage any major problems to emerge. In fact, the inclusion of the 'safeguard clauses' should help maintain reform momentum.
Strong GDP growth (7.5%) in 2004 is bolstering budget revenues, and has allowed the government to make two downward adjustments to its budget deficit target, now set at 1.6% GDP. Growth will slow in 2005, but still remains respectable and broadly supportive of ongoing fiscal discipline. A series of tax cuts are outlined for 2005, while there are also a number of potential strains on government spending, especially on public wages. However, the tax base should widen while efforts are being made to reduce subsidies, so the official 1.5% GDP deficit target is unlikely to be overshot by very much. Narrow budget deficits, together with robust GDP growth, a strong exchange rate and solid privatisation revenues, are supporting favourable public debt dynamics. General government debt (including guarantees) is forecast to end 2004 equivalent to around 24% GDP, and should continue to fall gradually during 2005 and 2006.
Strong investment-led growth has been driving up the current account deficit, forecast at 6% of GDP in 2004. Fitch expects further widening of the current account deficit in 2005-2006 to around 6.5% GDP per year. While this imbalance will need monitoring, Fitch is not overly concerned at this stage. Romania continues to generate large balance of payments surpluses, building foreign reserves and keeping a lid on net external debt, forecast at some 19% GDP at end-2004. Foreign direct investment-coverage of the current account deficit currently stands at around 60% and should increase, while much of the external imbalance is being driven by investment, as opposed to consumption. As capital account liberalisation is pursued in 2005 an increase in short term debt inflows is probable. Fitch expects short term external debt to rise to 19% of total debt at end-2005 (17% in 2004) and to 21% of total at end-2006. However, overall gross external debt should remain at its end-2004 forecast of around 38% of GDP for the next couple of years.
Developments in the banking system will also need monitoring given the rapid pace of credit expansion seen in the past two years. Non-performing loans are low at present, but could rise further down the credit cycle. The banking system has increased its external borrowing in order to finance FX-linked domestic loan growth, which has grown rapidly this year. Fitch highlights that the counterparts of much of this loan growth do not necessarily have hard currency revenue streams, which leaves the banking system exposed to an exchange rate shock
Posted by Mihai Botea : 11/18/2004 02:14:00 PM
The Romanian branch of the Turkish owned Finansbank is to be listed on the Bucharest Stock Exchange (BSE) as of next year, as the bank is to put out an initial public offering (IPO) in the second half of 2005.
Also planned for next year is the launch of the bank's second bond issue on the capital market, following the first issue made last month. "With our first bond issue we wanted to show our commitment to Romanian financial markets. In the medium term, we intend to open the bank to the public," said the president of the bank, Tamer Ozatakul, during the official opening of the trading session of the Bucharest Stock Exchange on the occasion of the listing of the bank's first bond issue.
As a result, Finansbank Romania will become the third foreign-owned bank to be listed on the capital market after BRD-SocGen and Eurom Bank. Two Romanian banks are also listed on the stock exchange: Banca Transilvania and Banca Comerciala Carpatica.
Posted by Mihai Botea : 11/18/2004 01:31:00 PM
Also planned for next year is the launch of the bank's second bond issue on the capital market, following the first issue made last month. "With our first bond issue we wanted to show our commitment to Romanian financial markets. In the medium term, we intend to open the bank to the public," said the president of the bank, Tamer Ozatakul, during the official opening of the trading session of the Bucharest Stock Exchange on the occasion of the listing of the bank's first bond issue.
As a result, Finansbank Romania will become the third foreign-owned bank to be listed on the capital market after BRD-SocGen and Eurom Bank. Two Romanian banks are also listed on the stock exchange: Banca Transilvania and Banca Comerciala Carpatica.
Posted by Mihai Botea : 11/18/2004 01:31:00 PM
The government has issued Decision 1872/2004, which amends the income and expenditure budget of the National Regulatory Authority for Communications (ANRC) for the year 2004, and includes the resources for financing universal services.
Providers of public electronic communications networks and of publicly available telephone services with a turnover of at least EURO 3m are required to contribute 0.8 per cent of their relevant turnover (not including revenues from interconnection and roaming) to the Universal Service fund, which for 2004 amounted to EURO 14.3m.
The Universal Service Fund receipts for 2004 will be divided 45 per cent on installing telecentres (telephone and internet access in remote areas), 35 per cent on granting subsidies and facilities to low income families and 20 per cent on directories and installing public payphones.
Universal service providers will be compensated for the net cost of providing these services.
In the years 2005 to 2010, the percentage to be contributed by operators will be 0.5 per cent.
Posted by Iulia Stoicescu : 11/18/2004 09:27:00 AM
Providers of public electronic communications networks and of publicly available telephone services with a turnover of at least EURO 3m are required to contribute 0.8 per cent of their relevant turnover (not including revenues from interconnection and roaming) to the Universal Service fund, which for 2004 amounted to EURO 14.3m.
The Universal Service Fund receipts for 2004 will be divided 45 per cent on installing telecentres (telephone and internet access in remote areas), 35 per cent on granting subsidies and facilities to low income families and 20 per cent on directories and installing public payphones.
Universal service providers will be compensated for the net cost of providing these services.
In the years 2005 to 2010, the percentage to be contributed by operators will be 0.5 per cent.
Posted by Iulia Stoicescu : 11/18/2004 09:27:00 AM
The government has approved a plan to build a theme park dedicated to the fictional vampire, Dracula.
It's expected the park will boost the tourist profile of the Transylvania region which was the source of inspiration for writer Bram Stoker. His story was first published in 1897.
The park will house a gothic castle with spooky effects, horror rides, labyrinths and also a golf course and a hotel.
The planned location is near the town of Snagov, a lake resort near Bucharest.
Dracula Park is a major tourism investment for Romania and consultants from London have been appointed to help raise private enterprise funding and sponsorship for the project.
Initial proposals were rejected because they meant building too close to the historic birthplace of Vlad the Impaler, who is thought to have been the inspiration for the Dracula character.
UNESCO, the cultural arm of the United Nations, said building the park near Sighisoara would have ruined the 13th century town which is designated a World Heritage Site.
One of the castles associated with Bran Stoker's fictional account of Dracula is about 15 miles south west of the city of Brasov in Transylvania.
Bran Castle was originally a fortress built by the Teutonic Knights in 1212 and was later used for the defence of the city of Brasov through the centuries, and one of the homes of Vlad Tepes, known as the Impaler.
It is an attraction for sightseers, visiting Dracula fans and literary scholars from around the world, and has an ecotourism resort nearby.
Another edifice, Castle Dracula, is now in ruins on a site beside the Arges river in the Fagaras mountains of central Romania.
But Scotland claims to have the original castle that inspired Bram Stoker to write his vampire story.
He was staying near Slains Castle in north-east Scotland in 1895, where he wrote part of the novel. The local authority this week gave its approval to renovate the bleak ruined building, and develop 35 vacation apartments within its walls.
The scheme is to be discussed in the Scottish Parliament in Edinburgh.
The plan has some opposition from locals who say development will drive a stake through the castle's historic charm.
Posted by Iulia Stoicescu : 11/18/2004 09:10:00 AM
It's expected the park will boost the tourist profile of the Transylvania region which was the source of inspiration for writer Bram Stoker. His story was first published in 1897.
The park will house a gothic castle with spooky effects, horror rides, labyrinths and also a golf course and a hotel.
The planned location is near the town of Snagov, a lake resort near Bucharest.
Dracula Park is a major tourism investment for Romania and consultants from London have been appointed to help raise private enterprise funding and sponsorship for the project.
Initial proposals were rejected because they meant building too close to the historic birthplace of Vlad the Impaler, who is thought to have been the inspiration for the Dracula character.
UNESCO, the cultural arm of the United Nations, said building the park near Sighisoara would have ruined the 13th century town which is designated a World Heritage Site.
One of the castles associated with Bran Stoker's fictional account of Dracula is about 15 miles south west of the city of Brasov in Transylvania.
Bran Castle was originally a fortress built by the Teutonic Knights in 1212 and was later used for the defence of the city of Brasov through the centuries, and one of the homes of Vlad Tepes, known as the Impaler.
It is an attraction for sightseers, visiting Dracula fans and literary scholars from around the world, and has an ecotourism resort nearby.
Another edifice, Castle Dracula, is now in ruins on a site beside the Arges river in the Fagaras mountains of central Romania.
But Scotland claims to have the original castle that inspired Bram Stoker to write his vampire story.
He was staying near Slains Castle in north-east Scotland in 1895, where he wrote part of the novel. The local authority this week gave its approval to renovate the bleak ruined building, and develop 35 vacation apartments within its walls.
The scheme is to be discussed in the Scottish Parliament in Edinburgh.
The plan has some opposition from locals who say development will drive a stake through the castle's historic charm.
Posted by Iulia Stoicescu : 11/18/2004 09:10:00 AM
Wednesday, November 17, 2004
The World Bank has approved two loans totaling $275 million (euro 211 million) to help Romania modernize its transport system and agriculture industry, the bank said Wednesday.
The transportation project, worth $225 million (euro173 million), is aimed at speeding the transport of passengers and freight by building bypass roads in five large Romanian cities and an integrated computer system for railway traffic.
The agricultural project aims to help farmers modernize their production activities. Agriculture in Romania is rudimentary, with most farmers having small farms, not owning tractors, and unable to get bank loans.
The improvements will help bring Romania up to European Union standards, the bank said. Romania hopes to join the EU by 2007.
Since the fall of Communism in 1989, the World Bank has granted Romania loans totaling over $4.2 billion (euro3.23 million). The 2004-2005 lending program amounts to about $850 million (euro653 million).
The transportation project, worth $225 million (euro173 million), is aimed at speeding the transport of passengers and freight by building bypass roads in five large Romanian cities and an integrated computer system for railway traffic.
The agricultural project aims to help farmers modernize their production activities. Agriculture in Romania is rudimentary, with most farmers having small farms, not owning tractors, and unable to get bank loans.
The improvements will help bring Romania up to European Union standards, the bank said. Romania hopes to join the EU by 2007.
Since the fall of Communism in 1989, the World Bank has granted Romania loans totaling over $4.2 billion (euro3.23 million). The 2004-2005 lending program amounts to about $850 million (euro653 million).
Posted by Cristian C. Francu : 11/17/2004 08:07:00 PM
On November 16, at the Ex-Im Bank Infrastructure Conference held in Bucharest, Mr. J.D. Crouch II, US Ambassador in Romania, had a speech in which he pointed the folllowing ideas:
- U.S. is officially the fifth largest investor in the country, with U.S. inv
- U.S. is officially the fifth largest investor in the country, with U.S. inv