Military Ordinance no. 8 – April 9, 2020 (DOWNLOAD PDF)

Situation of COVID-19 cases in Romania

 

 

Political and regulatory

 

  • Romania suspends exports of cereals, flour, oil and sugar during state of emergency: Romania suspended/banned the exports of cereals, flour, sugar, oil, and other agri-food products during the state of emergency declared in the country in the context of the new coronavirus (COVID-19) pandemic. The measure was included in the eighth military ordinance issued by the Romanian government. Wheat, barley, oat, maize, rice, wheat flour, soybean, sunflower, seed oil, sugar, and some bakery and pastry products are subject to this military ordinance. Export procedures for these agri-food products, which are in progress at the date of entry into force of the present military ordinance, are suspended during the period of emergency. Previously, PM Ludovic Orban said that the Government is ready to ban the export of wheat if needed in order to secure the necessary domestic inventories, after he was informed about 700,000 tonnes being exported in March alone, accusing grain traders of putting at risk local consumers out of greed. According to the same military ordinance, the flights to and from Spain will continue to be suspended in the context of the COVID-19 pandemic, for another 14 days beginning April 14. Moreover, the authorities decided that all air flights will be authorized by the Transports Ministry from now on, to avoid such situations as the one in Cluj where almost 2,000 people from Transylvania and Moldavia had queued in the parking of the Cluj Airport to take charters to leave for seasonal agricultural works in Germany. The measure already produced effects as 8 charter flights were canceled the next day. The ordinance also bans the sale of majority share stakes in the energy sector. Directly affected is the sale of CEZ Romania assets.  However, the 8th ordinance also includes some relaxation measures, allowing fishing (for authorized fishermen) and giving also green light for beekeepers and for auto repair shops. The food market will also remain open during the state of emergency, strictly for the farmers who present a certificate of agricultural producer. At the same time, during the curfew, the suspension of the nursing homes’ activities is banned, that including for elderly, children, adults, disabled people, as well as for other vulnerable categories. Furthermore, people entering Romania to perform the installation, commissioning, maintenance, service of medical equipment will also be exempted from the measure of isolation at home/quarantine, if they do not have COVID-19 symptoms and prove the contract relations with the beneficiary/beneficiaries on the territory of Romania. The provisions apply for the scientific, economic, defense, public order and national security fields.
  • Minister of Agriculture expects the ban on cereals export will be contested: “Seeing also the evolution of stocks we took this decision, which of course is a radical decision and of course it will be challenged in the coming days. We want all these products to stay in the country, during this period of emergency, to ensure the food security of Romanians, which is why the Ministry of Agriculture and Rural Development included in the Military Ordinance no. 8 the suspension of exports for some basic agri-food products, during the state emergency. If we see that in the next period the situation is improving, we will remove some of these products in the next ordinance, but at this moment this is our decision. The list can be modified, we can cut or include other products, but certainly the cereals remain on the list until the new harvest,” the minister said in an interview with Agerpres.
  • Romania’s online tax payment platform Ghiseul.ro will also be accessible to companies: The Romanian government approved on Thursday, April 9, a decision that provides the possibility for companies to pay their taxes to the state budget online, on the platform Ghiseul.ro.
  • About 90,000 Romanians could go to work abroad in the coming period, PM says: About 80,000-90,000 Romanians could go to work abroad in the coming period, prime minister Ludovic Orban said at public TV channel TVR. “About 80,000-90,000 people are likely to leave the country. I have no record of those who left. We have no legal leverage to prevent Romanian citizens from being employed by companies from other countries. At present, one million work contracts have been suspended, and 300,000 have been terminated in Romania,” Orban said. The PM also said that, so far, more than 250,000 Romanians have returned to the country.
  • PM Ludovic Orban on Thursday asked Labour Minister Violeta Alexandru to come up with a formula whereby the dignitaries can be included in the emergency ordinance regarding short-time working in the public sector. At the beginning of a government meeting, Orban said that he had already received dozens of derogation requests from various parts of the public sectors, insisting that even the dignitaries must express solidarity with those affected by the crisis. She said that the first draft of the ordinance is ready and that in the coming days it will be brought to the attention of each ministry. Political sources quoted by Digi24, claim the Government is working on a draft to cut the dignitaries wages by 25%.
  • HealthMin Tataru says materials are now available for hospitals treating COVID-19 patients: The Minister of Health, Nelu Tataru, on Thursday said that sanitary materials, coveralls and test kits are now available for all hospitals treating COVID-19 patients. The head of UNIFARM, Adrian Ionel, said that the materials distributed to the hospitals are enough for at least two and a half months. He stated that Romania expects 12 more aircraft with materials and “at least six trucks” with materials and equipment. The Secretary of State with the Ministry of Health, Andrei Baciu, said that the test capacity has increased by more than 8-9 times in the past weeks.
  • Government plans derogation from mandatory biofuel quotas for imported gasoline and diesel: The Government intends to grant, during the state of emergency, a derogation from the mandatory biofuel percentages provided by the existing legislation for imported gasoline and diesel sold to end consumers, which would fall to 8% for gasoline and 6.5% for diesel throughout the state of emergency, according to the statements of the Minister of Economy, Virgil Popescu, in the beginning of Thursday’s Government meeting. “You will see in the body of the ordinance and in the substantiation note that we speak about breaking the import chain, not the production”, he added. “Everything that can be purchased from Romania cannot benefit from derogation, i.e. they must purchase the biofuel that is produced in Romania,” said Prime Minister Ludovic Orban. “Unfortunately, we are 100% dependent on gasoline from import, and only 30% on (imported) diesel,” the Economy Minister concluded.
  • Marcel Ciolacu: After Easter, all MPs should come back to the office. Mandatory vaccination law will pass soon: PSD interim leader Marcel Ciolacu told DcNews on Friday that he will request that MPs return to work, after Easter, with the observance of all coronavirus prevention regulations, even if the state of emergency is prolonged. According to him, one of the laws that must be passed urgently is the vaccination law. “The law on vaccinations has political support. It will be passed by Parliament soon”, said Ciolacu.

 

Impact on the economy

 

  • Bucharest Stock Exchange has lost a third of its capitalization this year amid COVID-19 crisis: The Bucharest Stock Exchange (BSE) has lost 34% (EUR 13.2 billion) of the total market capitalization from the start of the year, since the first news about the new coronavirus (COVID-19), according to a report by PwC Romania. Thus, the decrease since the beginning of this year exceeded the increase of 23.4% recorded in 2019 compared to 2018, which marked the best performance of the BSE since the previous financial crisis.
  • Annual inflation rate steady at 3 percent this March: The annual inflation rate kept steady at 3 percent this March, as food grew by 5.11 percent more expensive, service prices advanced 3.8 percent and non-food prices went up 1.39 percent, shows data released on Friday by the National Institute of Statistics (INS).
  • Colliers warns that Romanian currency weakening could increase rental costs: The local real estate market could be affected this year by the potential depreciation of the Romanian national currency, in an already volatile context generated by the Covid-19 epidemic, according to real estate consultancy firm Colliers International.
  • Romanian analysts expect 6.5%-of-GDP public deficit and mild currency depreciation: Nearly half (48%) of the local analysts polled by the CFA Romania association under its monthly survey among members anticipate that the economic impact of the pandemic “will be felt strongly” until the fourth quarter of this year. The analysts also warned that the real estate prices in first tier cities are overvalued and that the CDS price (reflecting the price of sovereign borrowing) will increase, Ziarul Financiar reported.
  • 150,000 Romanians have asked banks so far to delay their mortgages: Banks have received so far around 150,000 requests from clients to delay payment of their mortgages. The Government’s emergency ordinance that allows Romanians to ask for the postponement of their mortgages has come in force early this week.
  • Association: Romanian producers can provide only 30% of the required pork meat for domestic consumption: Local producers warn that they can only provide 30% of the required pork meat for domestic consumption, Romania having to import the remaining 70% to ensure the food security of the population, under the current conditions of the spread of African swine fever and of the COVID-19 pandemic. Representatives of the association claim that pork producers were ignored by the authorities in the process of drafting support measures for the business environment. “In this context, we urge you to grant an audience as soon as possible, and it is absolutely necessary for APCPR to be able to communicate the measures that need to be implemented immediately to support the sector and to ensure the food security of the population,” reads the open letter.
  • Anti-crisis solutions from oil companies: liberalization of the natural gas market and modification of the offshore law to launch large offshore projects in the Black Sea: The Federation of Oil and Gas Employers (FPPG) proposes to the Government a series of measures to help the industry, which “is facing the most difficult period in the last century ”. Among them, the liberalization of the natural gas market and the elimination of the additional taxation from July 1, as well as the urgent modification of the offshore law, to allow the production to start in the Black Sea.