SIMILAR ARTICLES

Sudden and spectacular deficit growth: budget implementation on H1

  At the end of the first half of the year, the general consolidated budget registered a deficit of about RON 15 billion, an amount… Mai mult

World Bank – A scary report that no longer scares anyone: Latest assessment of Romanian emigration

Between three and five million Romanians work and live abroad. The 2017 UN estimate, rated as optimistic by the World Bank’s Report on Diagnosis of… Mai mult

In only one quarter: Incomes increased five times faster than GDP. For public sector employees, even faster

Data released by the INS for the first quarter of 2018 show that households’ living standards increased considerably compared to the same quarter of the… Mai mult

It is the Administrative Code’s turn: little responsibility for local elected officials, higher power for asset disposing, privileges

The Chamber of Deputies votes the amendments to Romania’s Administrative Code on Monday, amendments that strengthen the political control over local administrations. It is expected… Mai mult

Purchasing power declined for second consecutive month: situation by fields of activity

The average gross wage announced by the INS for May 2018 was 4,512 lei, 0.4% lower than in the previous month. Net nominal average wage… Mai mult

We and Juncker Plan: Bulgaria – 3rd position, Romania – 23rd position. How other neighbours are doing

de Adrian N Ionescu , 11.6.2018

The value and economic impact of the Romanian projects to attract resources from the so-called “Juncker Plan” of European investments are much lower, compared to those of the countries from Central and Eastern Europe, according to the European Commission’s reports made in May.

Several projects from Central and Eastern Europe are relevant to the use of resources provided by the Juncker Plan, through the European Investment Fund (EIF) and the European Investment Bank (EIB):

  • Slovakia will build the ring road of Bratislava capital city. (Romania is far from succeeding the same for Bucharest).
  • Poland will develop a regional hospital, improve and expand its electricity grid and build housing facilities for citizens with low incomes. (Romania has a new law on the public-private partnership, which would also be used for regional hospitals).
  • Bulgaria will develop its business in the agro-veterinary field through the research project of a company with international exposure, including on animal vaccines. (In Romania, Cantacuzino Institute is still undergoing restructuring).
  • Approved hospital construction projects in developed countries such as Austria, the Netherlands, Italy, and the United Kingdom are also remarkable.
  • Romania’s most remarkable project is one that is part of a larger, pan-European one: 40% of the Romanian segment of BRUA gas pipeline. Pressures from the European Commission will be significant for Transgaz to properly prepare the application file.

Share of projects in GDP: Bulgaria – 3rd position, Romania – 23rd position

The recent type of Romania’s economic growth (GDP) proves to be fragile also from the point of view of the capacity of using resources made available by Juncker Plan and provided by the European Investment Fund (EIF) and the European Investment Bank (EIB).

Our country also ranks 23rd in the top of project values, by the share of GDP of the investments provided by EIF and EIB, according to data released by the European Commission in May.

Bulgaria, Croatia and Slovenia have a lower economic power than Romania (according to the nominal GDP, estimated for 2018 by the IMF at about a quarter of Romania’s GDP), but rank 3rd, 13th and 14th, respectively.

Hungary ranks 19th, although its nominal GDP is 67% of Romania’s GDP.

*

  • Ranking of investment projects financed by EIF and EIB, as a share of GDP

*

The capacity of Romania’s authorities and companies to use the Juncker plan funds proves therefore much weaker than expected based on its economic growth if this growth were healthy.

What “Juncker Plan” is

The Investment plan for Europe initiated by EC President Jean Claude-Juncker four years ago and launched in May 2015, is the response of the European executive to the investment decline following the economic crisis.

The plan is based on 3 pillars, according to CE:

  • The European Fund for Strategic Investments (EFSI), which provides guarantees for the European Investment Bank (EIB) loans. In September 2016, there has been decided an extension from three to five years, until 2020, and an extension of the investment target from EUR 315 to 500 billion.
  • The European technical assistance platform and the European portal for investment projects, in association with the EIB Group.
  • Improvement of the business environment by removing regulatory barriers to investment.

The operating mechanism is the same as originally set (even if the figures below were not updated after the investment targets have increased).

How Juncker plan operates through the European Investment Fund, the European Investment Bank (EIB) and the European Investment Fund (EIF)

We and the others

Romania has gained its 23th position among the 28 EU member states, with a financing approved by EFSI of EUR 361 million, which can raise total project investment to a little over EUR 1.3 billion.

Besides Transgaz – BRUA project, Romanian companies that stand out because they succeeded to sign with EFSI and the EIB for financings under the Juncker plan are:

  • Unirea Medical Center, which received a grant from the EFSI of EUR 15 million and will invest a total of EUR 57 million in expanding Regina Maria‘s private health network.
  • GreenFiber International SA, with an EUR 7.5 million loan (EFSI), to finance a recycling project that facilitates the transition to a circular economy. Total investment planned is EUR 20 million.
  • Agricover, an IFN with expertise in loans for agriculture, will receive EUR 15 million from the EFSI (Tranche 1) to further finance SMEs in the agricultural sector. The total investment planned is EUR 54 million.
  • Two projects have also been approved: the National Radiocommunications Company for the transition to a digital broadcasting infrastructure, amounting to EUR 10 million, and a research project, with no details, of the White Goods Factory.

As in most countries, Romanian banks also access EIF funds to finance SMEs.

The lenders in Romania have 5 financing agreements amounting to EUR 83 million and total investments would amount to EUR 471 million, for about 2,599 small firms.

Of all the projects of other emerging EU countries, we can also note:

Bulgaria

  • Company Biovet will be funded for developing the production, including of animal vaccines, with EUR 100 million (the same amount as the one received by Transgaz from EFSI for BRUA gas pipeline).
  • Oliva, a company that manufactures sunflower oil, will receive EUR 31 million to expand its production capacity. Total investments supported this way will be EUR 62 million.
  • Financial intermediaries have twice as many agreements as those in Romania. They receive financing of EUR 70 million to support an investment of EUR 930 million in 6,033 SMEs, including start-ups.

Slovakia

  • The Slovak public transport infrastructure institution (IES) will receive EUR 426 million for the plan, construction and operation of a 27 km section of the Bratislava motorway ring road. The total investment planned is estimated at EUR 639 million.
  • Five loan agreements with financial intermediaries, of EUR 37 million, for crediting 7,621 SMEs with EUR 267 million.

Croatia

  • The national energy company Hrvatska Elektroprivreda DD will receive EUR 50 million to build a capacity for electricity and heat cogeneration for Zagreb capital city. Total investment will be EUR 195 million.
  • The project for developing tourism in the Istria peninsula from the Adriatic Sea will receive EUR 16 million.

Poland

A selection of Polish projects with already signed financing agreements looks like this:

Mergeți în homepage ›

Publicat la data de 11.6.2018

Lăsați un comentariu


NEWS

Ministry of Finance is drafting a new fiscal framework valid as of January 1, 2019

The Ministry of Public Finance makes a "comparative analysis" of the Tax Code and the Tax Procedure Code with a view to applying a new… Mai mult

Eurostat: Romania and evolution of employee number in public sector in an European context

Romania, Hungary and Slovenia are the member states that recorded the largest increase in the share of public sector employees in the total number of… Mai mult

Fitch confirms Romania's rating at BBB- but warns: fiscal loosening is risky for macroeconomic stability

Fitch Ratings confirmed on Friday Romania's rating for long-term foreign and local currency debt at BBB-, with a stable outlook, but warned that fiscal loosening… Mai mult

"We are working on a tax amnesty mechanism": announcement made by Minister of Finance

Finance Minister Eugen Teodorovici said at a press conference held in Bistrita that "a mechanism of this type is in progress”, a mechanism on tax… Mai mult

AOAR - Economy against new Criminal Code: businessmen denounce excessive protection provided to officials who cause damages to economy

The Businessmen’s Association of Romania (AOAR) asks the ruling coalition to explain the mechanism by which, after changes introduced on Wednesday in the Criminal Code,… Mai mult

Number of insolvencies increased by 12% in first five months. Suspended activities - plus 31%, dissolutions - plus 59%

The increase in the number of companies and PFAs in insolvency was 11.97% in the first five months of this year, compared to the same… Mai mult

Transport infrastructure in Romania needs EUR 70 billion - double as compared to existing resources

The investment needs in Romania's transport infrastructure exceed EUR 70 billion, while the available resources by 2030 are EUR 36 billion, according to the Transport… Mai mult

Refusal to work annuls entitlement to social assistance - bill voted in Chamber of Deputies

Deputies adopted a draft law on Wednesday whereby entitlement to social assistance ceases when a job is refused. The decision, Agerpres announced, was taken with… Mai mult

Subsidy of RON 900/month for employing a graduate based on contracts of indefinite duration

The National Agency for Employment (ANOFM) grants subsidies of RON 900/month to employers who employ graduates of educational institutions, with contracts of indefinite duration, within… Mai mult

C.P. Tariceanu, before the heads of Senates from EU: The European Commission has encouraged the parallel state, in Romania it is like in the 50's

Calin Popescu Tariceanu (foto) delivered a very tough speech on Friday, in the Senate, addressed to the European Commission, which he accused of encouraging the… Mai mult

National Bank of Romania wants to lower indebtedness limit in granting loans to individuals

The National Bank of Romania (BNR) sent to banks for consultation a draft amending Regulation 17/2012, which provides for a consistent lowering of the indebtedness… Mai mult

High impact provisions: Senate has adopted PSD-ALDE amendments to the Code of Criminal Procedure

Senators adopted on Wednesday the draft for amending the Code of Criminal Procedure, by 74 votes for to 28, against. The bill goes to the… Mai mult

RBL: Workforce crisis is worse than economic crisis - 3.4 million Romanians have left the country in last 10 years

Migration is one of the most serious problems facing Romania at this time, along with the lack of infrastructure. However, the return of Romanians to… Mai mult