November 9, 2017

Romania faces monetary pressure; Higher Council of Magistracy debates proposed changes to the judicial code

Mihai Pelin, 09.11.2017, 13:38

FINANCIAL — National Bank Governor Mugur Isarescu warned that the Romanian national currency, the leu, faces the danger of depreciation, as imports grow disproportionate to exports. He said that the National Bank reviewed its expectation for inflation at the end of the year, from 1.9% to 2.7%. For the end of 2018, the National Bank estimates a 3.2% rate of inflation. The main inflationary points of pressure, according to the governor, are rising production costs, rising wages and growing uncertainty in energy pricing. The National Institute of Statistics announced that the countrys trade deficit in the first three quarters went up to 8.8 billion Euro. According to analysts, this imbalance between imports and exports puts pressure on the Euro-leu exchange rate. In addition, uncertainty regarding proposed changes to the fiscal code, harshly criticized by trade unions, employers and the head of state, caused the leu to depreciate sharply on Wednesday against the Euro, reaching the lowest level in the last five years.

PROTESTS — Thousands of people protested Wednesday night around the government headquarters against changes planned to be made by emergency executive order. The changes include reducing income tax from 16 to 10 percent, and shifting the burden of social insurance contributions from employers to employees. Protesters fear a drop in salaries if the changes go through. The measures are also opposed by trade unions, businesses and the right wing opposition.

JUSTICE — The Higher Council of Magistracy in Romania debates today legislative proposals to modify the judicial code, the package of laws regulating the justice system, proposals introduced as bills in the lower chamber of Parliament. On Tuesday, the general assembly of organized crime prosecutors voted against the bills, claiming that the process of debate and consultation in the body of magistrates was incoherent. The bill package was also on the agenda for Justice Minister Tudorel Toader, at the meeting he held in Brussels with European Commission Vice-President Frans Timmermans.

FOOTBALL — Romanias national soccer team plays on Thursday night against Turkey in the city of Cluj. On November 14 they play against Holland in Bucharest. 30 players have been summoned for the game, 17 of them playing for teams abroad. The two games are the beginning of preliminaries for the Euro 2020 competition, after the Romanian national team missed qualifying for the 2018 World Championships in Russia, under German coach Cristoph Daum, who was dismissed in September. The Turkish team is coached by former Romanian soccer star Mircea Lucescu.

BREXIT — A new round of negotiations between the EU and London on the Brexit kicks off on Thursday in Brussels. The priority issues are the costs of the break-up, the rights of European and British citizens on each others territories, and the problem of the Irish-Northern Irish border. Guy Verhofstadt, the European negotiator for the Brexit, said that the guarantees offered by London regarding the rights of European citizens while in Britain were insufficient. The British government announced recently that most EU citizens living in the UK would have the right to stay after the Brexit, in March 2019. They would have two years to apply for residency. The legal status and rights of EU citizens are key aspects in the convoluted process of Britain leaving the Union. Around 3 million EU citizens live on British territory at this point.