The Week in Review, November 11-17

The draft budget for 2014 has been approved by Romania’s government and is to be debated by Parliament soon. The budget has been built on a 2.2% economic growth rate and a 2.4% inflation rate. More than half of the total budget of about 230 billion lei (or 50 billion euros) will go to salaries, pensions and social assistance services. The total amount earmarked for investment stands at 6% of the GDP. The draft state budget also provides for an increase in pensions by 3.76% and in salaries up to the level of 900 lei. It also provides for monthly grants of about 150 euros for medical interns and pharmacists. Education will get extra funds in 2014, as 300 million euros will be used to finalize school infrastructure works initiated with European funds. The salaries of beginner teachers, tutors and junior lecturers will also go up by 10%. The Government counts on a better tax collection rate, reduced fiscal evasion and more revenues to the state budget to cover these costs. The opposition, however, has criticised the way the budget is constructed. The Liberal Democratic Party leader Vasile Blaga says this budget mirrors the economic involutions and will affect the business environment and the citizens.

The decentralization bill, OK-ed by Government

The Government has this week approved the decentralization bill for which they will take responsibility in Parliament next week. According to the bill, health, agriculture, environment, culture and sports are the main fields to be decentralised. Local administrations will also take charge of authorization and classification in tourism, sports clubs and centres as well as school camps. Deputy Prime Minister Liviu Dragnea says the Police and social services will not be part of the decentralization process. Dragnea has pointed out that neither ports nor movie theatres will be transferred to local authorities.

Romgaz listed on stock exchange in London and Bucharest

The stocks of Romgaz, Romania’s largest natural gas supplier have been listed concurrently in Bucharest and London. Attending the event in Britain’s capital city, Romanian Prime Minister Victor Ponta said on that occasion:

“Based on this success story, we hope to be back here next year with Hidroelectrica, Electrica and other Romanian public companies, and I hope this will give foreign investors proof that we are ready to tap into the potential that has not been used so far.”

The special parliamentary committee on Rosia Montana voted against the bill on the gold mining project.

The draft law on the gold and silver mining project in Rosia Montana, endorsed by the Government, will be submitted to Parliament, after a special parliamentary committee voted against the bill. A new bill would be drafted, outlining a framework for future mining operations in Romania. In spite of the negative vote, the committee’s report has been acknowledged by the Rosia Montana Gold Corporation, the Canadian investor that wants to develop the project. Gold Corporation representatives voiced hope that new stipulations would be adopted as soon as possible. The special parliamentary committee on Rosia Montana was established in response to street protests staged for months by environmentalists, who warned over the negative effects of cyanides on the environment.

Discontent over under-financing of education and health systems

Several thousand students took to the streets in several university centres in Romania asking for 6% of the GDP to be allocated to education. Protesters also asked for an increase in the subsidies for student accommodation and meals and for a 30% increase in the scholarship fund. Students argued that universities, forced by the severe under-financing in the system, raised a series of taxes. Professors are supporting the students’ claims. The health system stands no better. The SANITAS trade union has announced a warning strike on November 25th and an all-out strike starting November 28th, for an unlimited period of time. Unionists are asking, among other things, for 6% of the GDP to be allocated to the health system, a better salary law, quality services for patients and the resignation of the health Minister Eugen Nicolaescu. The National Health Insurance Authority says the 2014 budget will allow for a good functioning of the system and for an improvement in patient services.