Daily news report COVID-19 crisis

Situation of COVID-19 cases in Romania

• Romania registers almost 3,000 new coronavirus infections in the last 24 hours, number of deaths increases significantly: In the last 24 hours, there have been 2,958 new cases of COVID-19, a new record for coronavirus infections since the start of the pandemic. The number of deaths is also increasing. In one day, 82 people died of COVID. In the specialized health units, the total number of people hospitalized with COVID-19 is 8,303. Of these, 612 are in Intensive Care (ICU). To date, 2,568,071 tests have been processed at the national level, of which 27,814 were performed in the last 24 hours. Most new cases in the last 24 hours were registered in Bucharest (514), Iasi (157), Alba (117), Timis (104), Prahova (101), Cluj (98) and Constanta (94).

Political and regulatory

• Restrictions in Bucharest due to growing Covid-19 cases: Indoor cafes, restaurants, cinemas, theatres and gambling halls closed. Face masks mandatory around schools: Bucharest prefect has announced on Tuesday evening that several restrictions will be in force in the Capital city as of Wednesday, October 7 amid skyrocketing COVID-19 cases in the past days. The restrictions are to be in force at least 7 days so long as the incidence rate is maintained at over 1.5 per thousand inhabitants. In his turn, secretary of state for emergency situations Raed Arafat told TVR 1 state broadcaster that more venues will be shut down such as indoor cafes, restaurants, cinema halls and theaters in Bucharest, and also gambling halls. When it was initially announced, the draft of restrictions did not include gambling halls, but Arafat mentioned they would be also closed and that it was a miscommunication. The prefect of Bucharest said that the employees affected by the shut downs in the hospitality and showbiz sectors will benefit of support, through the emergency ordinance 120/2020. However, the employers’ associations of restaurants in Romania announced they will challenge the new restrictions in court, with the HORA President Daniel Mischie arguing that indoor restaurants have been opened on September 1 and 2 weeks after that, the incubation period of the virus, there has been no rise in the number of people infected with the new coronavirus. About 100,000 employees in the HoReCa sector will be laid off by the end of the year, and the industry will suffer losses of three billion euros, as a result of the restrictions decided by the Government in the context of the Covid-19 pandemic, Călin Ile, president of the Romanian Hotel Industry Federation said on Wednesday for AGERPRES. According to Digi24, new restrictions were readied and adopted today. On the list of new restrictions is the closure of gambling halls, bars, clubs and discos. Another proposal concerns the reduction of the perimeter around schools where mask- wearing will be mandatory, from 100 meters, as established yesterday, to 50 meters.
• RO authorities warn of pressure on health care system as Covid-19 cases increase: As the number of coronavirus cases has been increasing and the available hospital beds started filling up quickly, the authorities have urged the public to follow the Covid-19 prevention rules and warned that the health care system’s limits should not be tested. Speaking to public television station TVR 1, health minister Nelu Tătaru said the ministry would do everything possible to find more available intensive care beds and highlighted the issue of the fatigued medical staff. The health minister also said that beds are still available in intensive care units in Bucharest, but full capacity could soon be reached. He announced an evaluation was carried out to allow the Ilfov, Colentina, and Witting hospitals to adapt their available beds to the new situation, where there are both coronavirus and flu patients. He said Romania currently has 4,000 Remdesivir doses available.
• Defense Minister Ciuca on official visit to the U.S. Wednesday through Sunday: Minister of National Defense Nicolae Ciuca will pay on an official visit to the U.S. Wednesday through Sunday, at the invitation of the U.S. Secretary of Defense Mark T. Esper, the Ministry of National Defense informs, according to Agerpres. Ciuca is set to meet with senior officials of the U.S. Department of Defense.
• Deputy PM Turcan: Financing from European funds has no political color: Deputy Prime Minister Raluca Turcan said on Tuesday evening that financing from European funds “has no political color”, and in the case of local administrations led by Liberals having obtained larger amounts, this is due to their more efficient activity, according to Agerpres. Raluca Turcan emphasized that the rules for accessing European funds are the same for everyone, the management of the situation in schools and healthcare units not being conducted in a political direction.
• Minister Stroe meets officials of sports clubs operated by his ministry: At the Tei Student Sports Complex in Bucharest on Tuesday, Minister of Youth and Sports Ionut Stroe met officials of sports clubs operated by the Ministry of Youth and Sports to discuss how the COVID-19 pandemic has influenced their activity. Also discussed at the meeting was the possibility of reimbursing COVID-19 tests from the MTS budget, equipping rooms with nebulizers and UV lamps, the annual budget, as well as the priorities for 2021.
• Ministry of Culture recommends compliance with all measures communicated by Public Health Directorate: The Ministry of Culture recommends compliance with all measures communicated by the Public Health Directorate to reduce the risk of infection, given that the number of COVID-19 cases has increased “very much” in the last week and the trend is still to increase. “Cultural activities have been severely affected by previous restrictions, we have seen the impact of stopping them has and we want them to remain open to the public,” Culture Minister Bogdan Gheorghiu said in a press release on Tuesday.
• Romania supporting funding environmental objectives under Recovery and Resilience Facility, pointing to national peculiarities: Romania is supporting substantial funds for the green and digital objectives in the European Union’s Recovery and Resilience Facility, while pointing out that the member states have different national specificities, stages of development and needs, Romania’s Finance Minister Florin Citu told a recent virtual ECOFIN meeting. Citu also reiterated the idea of operationalizing the recovery instrument in a way that is as fast and flexible as possible. A text presented by the German presidency was endorsed by most of the member states and is the basis for negotiations with the European Parliament. Rounding up the agenda of the ECOFIN meeting was an action plan on the Capital Markets Union, a digital finance package (which also includes legislative proposals on the crypto-assets market) and the preparation of the virtual meeting of finance ministers and central bank governors of the G20 and an annual meeting of the International Monetary Fund (IMF) October 12-16, 2020.
• Eight proposed ambassadors heard by specialized committees on Wednesday: Eight people proposed to be appointed as Romania’s ambassadors abroad will be heard on Wednesday by the joint specialized committees in the Chamber of Deputies. Among them are: Stefan-Alexandru Tinca, proposed as ambassador to the Republic of Turkey, Radu-Catalin Mardare – proposed for the Lebanese Republic, Silvia Davidoiu – for the Republic of Serbia; Gabriel-Catalin Sopanda – proposed for Hungary and Dan Petre – proposed for the Argentine Republic and the Republic of Paraguay
• Full day at the Constitutional Court: The Constitutional Court of Romania (CCR) debates on Wednesday the PNL’s objection related to the amendment of the Law on consumer protection against excessive interests. The judges of the Court will also discuss the notification of the President Klaus Iohannis and that of the Government regarding the modification of the law 94/1992 regarding the organization and functioning of the Court of Accounts. Also on Wednesday, CCR will discuss the notification made by the Government on the Law on the approval of the Government Emergency Ordinance no. 72/2020 on measures to complete the process of restitution, in kind or equivalent, of buildings abusively taken over during the communist regime in Romania and the establishment of transitional measures. The Constitutional Court will also discuss on Wednesday the complaint filed by USR, PNL, PMP, PSD, as well as unaffiliated deputies on the law amending the Fiscal Code so that economic operators who want to distribute and sell wholesale energy products are required to have adequate storage spaces.
• EC challenges ban on European governments from collecting citizens’ data: The Court of Justice of the European Union (CJEU) ruled on Tuesday that EU member states cannot collect internet and mobile data from their citizens, arguing that forcing internet and telephony operators to transmit or randomly withhold traffic and location data is against the law of the Community Bloc.
• European Parliament votes to reduce pollutant emissions by 60% by 2030: The European Parliament has voted to reduce greenhouse gas emissions by 60% by 2030. The decision is a victory for a coalition of Green, Socialist and Democrats and Renew Europe, Politico reports.
• The head of the Competition Council announces the end of the Euthyrox crisis: Additional quantities of a drug with the same active substance as Euthyrox will soon arrive in Romania, and people should be patient and not stock up for several years, because the situation will soon return to normal. The statement was made for Agerpres by Bogdan Chiriţoiu, the president of the Competition Council. The competition authority has completed an analysis of this market, concluding that the lack of Euthyrox on the market cannot be attributed to parallel exports or the limitation of quantities placed on the market but, rather, to an increase in Euthyrox consumption generated by oversized purchases made by patients in the context of the COVID-19 crisis.
• Internal battle for parliamentary election lists within USR-PLUS: An internal battle is taking place these days within USR itself and within the Alliance with PLUS for designating candidates for the parliamentary elections, with some accusing the lack of transparency or being marginalized as the “internal opposition”. The party must validate the lists by mid-October. At the end of the week, conferences are scheduled across the country, where delegates will physically vote the list for Parliament. No agreement was reached between USR and PLUS on how the lists for parliamentary elections will be compiled, although there were discussions before the local elections. USR-PLUS hopes to get a score of around 20% in the December parliamentary elections, almost double compared to the previous elections. The party relies on a much better political vote than that at the local elections, and especially on the voters from Romanians living abroad, who did not vote in the local elections. In contrast most other major parties have already completed their lists and are readying their campaigns, banking that the elections would not be postponed.
• Cluj-Napoca residents can have online meetings with City Hall staff: The City Hall of Cluj-Napoca launched a new service, allowing residents to hold online meetings with 524 public servants and management staff of the institution. The new service, called Tichetul Albastru (Blue Ticket), adds to the already existing option of setting up online appointments with the mayor, the deputy mayors, the public administrator, and the directors of the City Hall, Cluj mayor Emil Boc explained.

Impact on the economy

• Poverty, deficit expected to rise in Romania, WB report says: The protracted COVID-19 pandemic has seriously affected Romania’s economic activity and household incomes in the short-run, says the World Bank’s Human Capital Index. The economy contracted by 4.7 percent in H1 of 2020, driven by a decline of 10.5 percent in Q2. The fiscal deficit widened to 4.2 percent of GDP in H1 of 2020 reflecting lower revenues and higher expenditures due to COVID-19. Key risk indicators of credit institutions remain at adequate levels. The banking sector remains well capitalized. The economy is expected to contract by 5.7 percent in 2020. To address the consequences of COVID-19, the fiscal deficit is expected to widen to around 9 percent of GDP in 2020. A substantial reduction of the deficit in 2021 is improbable as the government will have to support the economic recovery process. However, public debt remains one of the lowest in the EU. Poverty is projected to increase. Slower recovery of the European economy, and in particular of Germany and Italy, Romania’s main trading partners, would put additional pressure on the domestic economy. In addition, the 40 percent increase in public pensions passed recently by the Parliament, if not reversed, would seriously impact macroeconomic stability while, in the short run, could lead to a downgrade in Romania’s sovereign ratings. Additional risk stems from Romania’s historical low EU funds absorption rates raising questions on the country’s capacity to take advantage of the EU recovery funds.
• Germany acknowledged as biggest foreign investor in Romania: Germany is the biggest foreign direct investor in Romania, with investments worth EUR 13.1 billion, or 14.9% of FDI stock, at the end of 2019, according to the ranking by end-beneficiary compiled by Romania’s National Bank and the National Statistics Institute. BNR’s new foreign direct investment (FDI) ranking thus takes into account the country of origin of the real investor, compared to the origin of the latest intermediary (investment vehicle) in previous years. The ranking based on the old methodology indicated the Netherlands as the biggest foreign investor in Romania, with EUR 20.5 bln at the end of 2019. However, the new ranking shows that 75% of this sum represents foreign investments made in Romania by companies from other countries using investment vehicles registered in the Netherlands. Most foreign investments that have so far been counted as Dutch (because of the intermediary vehicle) are, in fact, American, according to the new data published by BNR. Next in the ranking after Germany are: Austria (2^nd), France (3^rd), Italy (4^th), USA (5^th), Netherlands (6^th), and U.K. (7^th).
• Consolidated general budget outstanding debt hits 5.7 pct increase in August 2020: Consolidated general budget outstanding debt increased by 5.7 pct in the eighth month of the year, from 256.33 million lei in July to 271.1 million lei in August 2020, according to data published on the website of the Ministry of Public Finance (MFP).
• Drought destroys a quarter of Romania’s crops this year: Some 2.2 million hectares of arable land, a quarter of Romania’s cultivated land, were ravaged by the extreme drought this year, agriculture minister Adrian Oros announced on Tuesday, October 6. “We’d better invest heavily in irrigation systems,” said Oros, quoted by Economica.net. According to the Agriculture Ministry’s data, the Government has spent EUR 200 million so far to cover farmers’ damages this year. “If we pay another EUR 200 mln, this would add up to EUR 400 mln. How many tens of thousands of hectares would we have irrigated if we had invested this money in the irrigation system? In 2017-2019, the average amount invested in irrigation was RON 170 mln (EUR 35 mln),” minister Oros explained.
• Romania imports pork worth 292 million euro in H1: Romania imported pork worth 292.2 million euro, in the first six months of this year, an increase of 17 pct over the similar period of 2019, according to data centralized by the Ministry of Agriculture and Rural Development (MADR), transmitted on AGERPRES’ request.
• Romania imported EUR 14 worth of face masks per capita in Q2: Romania imported protective face masks worth EUR 272 million in the first half of the year, with most of the imports taking place after the coronavirus outbreak started in March. Thus, Romania ranks 10th in the European Union for the value of mask imports. Romania bought more masks than Portugal but spent less than the Czech Republic and Poland. Romania spent EUR 14 on masks per capita in the first six months of the year.
• IFNs receive more than 10 million euros from foreign shareholders in first eight months of 2020: Consumer credit companies received capital injections worth 10.83 million euros from foreign shareholders in the first eight months through capital increases, up 86% compared to the same period last year, according to the data of the National Trade Register Office (ONRC).
• Czech billionaire to finalize takeover of CME media group: PPF Group, controlled by Czech billionaire Petr Kellner, will finalize the takeover of regional media group CME (Central European Media Enterprises) on October 13. The deal between PPF and US group AT&T, CME’s majority shareholder, has been cleared by the European Commission.
• Brazilian investors takes over Romanian cyber security firm: Brazilian company Stefanini, a provider of services and IT solutions for the business sector, acquired a 60% stake in the Romanian cybersecurity firm Cyber Smart Defense (CSD) from local entrepreneur Mădălin Dumitru, founder and general manager of CSD.
• US investment fund close to taking over another small Romanian bank: American investment fund JC Flowers is reportedly in pole position for taking over the Romanian subsidiary of French group Credit Agricole, according to Ziarul Financiar.
• Odeon Theater’s head: Closing theaters, performance halls, a nightmare: Closing theaters and performance halls is “a nightmare”, especially since the decision was taken overnight, Cristian Sofron, the manager of the Odeon Theater, told AGERPRES on Wednesday. Sofron said that now, after the reopening of the halls in September, the theaters have sold tickets for the next shows, and now they have to explain to the spectators why they need to be refunded. In turn, Marinela Tepus, manager of the Nottara Theater, stated that the decision announced by the Bucharest’s Prefect to close down theaters and event halls is hard to accomplish, because “a theater is very hard to close at a whim”. Tepus said that in the country “there are very few, to none, actors sick of COVID.”
• Rector Costoiu: Big universities must have special treatment, be financially supported by Gov’t: The rector of the Polytechnic University of Bucharest (UPB), Mihnea Costoiu, on Tuesday told AGERPRES that the big higher education institutions should have “a special treatment” and they should be financially supported by the Government, in the context of “increasing pressure from the European universities.” He stated that UPB wants to establish itself as a “top” university in Europe and in the world.