The Week in Review April 6-12
Click here for a roundup of the week's main stories
Corina Cristea, 11.04.2015, 13:00
Government slashes VAT for foodstuffs
The Government in Bucharest decided to slash the value-added tax for foodstuffs, non-alcoholic drinks and food industry services, from 24 to 9% starting June 1, six months before the new Fiscal Code takes effect. The reason for the early introduction of this measure was the additional revenues to the budget, higher than originally estimated, Prime Minister Victor Ponta explains. Other products and services will also see a 4% slash, down to 20%, starting January 1, 2016. The VAT for bread was slashed to 9% in 2013. The Romanian Government claims the measure will have an impact of 1.1 billion euros on the state budget, although the population will benefit from additional consumption opportunities. The measure is also aimed at stimulating consumption and hence economic growth. Some pundits however have warned that the VAT slash will result in an increase of the budget deficit.
European Commission vice-president Valdis Dombrosvskis visits Bucharest
The Romanian Government’s fiscal relaxation measures will have a negative impact on the economy, says European Commission vice-president Valdis Dombrovskis, the EU Commissioner for the Euro and Social Dialogue. The EU official said that Romania however reported significant progress in what regards macroeconomic imbalances. Valdis Dombrovskis said Romania’s economy is developing. The country has implemented important reforms of its international financial assistance programme, both in terms of the budget deficit and regarding its shortfalls. It must continue structural reforms related to the privatization of state-owned enterprises, the effectiveness of public administration and the absorption of European funds. The European Commissioner attended the launch of the European programme “The Youth Guarantee”, whereby 400 thousand young people in Romania will be able to find a decent job over the next 4 years by using Commission funds.
Statute of Romanian MPs is changed
Romanian MPs have changed their statute, to the effect that the prosecution, detention or pre-trial arrest of a Deputy or Senator may be approved on the vote of the majority of MPs attending the meeting in which the prosecutor’s request is being discussed. The change brings Parliament’s Rules of Procedure in line with the Constitution, as the previous statute allowed for incongruities between the two Chambers. The National Anti-Corruption Directorate has recently called on the Senate to greenlight the pre-emptive arrest of Dan Sova. Although most MPs voted in favour, Senate dismissed the request for lack of quorum. The decision created a public uproar, as previous requests were approved with a simple majority of those attending the meeting.
Judicial decisions in Romania
The Constitutional Court of Romania has taken note of the notification sent by the Superior Council of Magistracy regarding the constitutional conflict between the Public Ministry and the Romanian Senate, regarding the latter’s refusal to draft and publish the decision attesting the result of the vote in the plenary session of the Senate on the arrest pending trial of Social Democrat Dan Sova, a former Transport Minister, as requested by the National Anti-Corruption Directorate. The High Court decided that the Senate has the obligation of drafting the decision adopted in the plenary session of March 25 and to refer it to the relevant public authorities and publish it in the Official Gazette. In another development, the High Court of Cassation and Justice approved another request by the Directorate to extend the arrest warrant issued for Marian Vanghelie, the suspended Mayor of Bucharest District 5 City Hall, for another 30 days. Vanghelie is being investigated for abuse of office, bribe taking and money laundering. The former chief of the National Integrity Agency Horia Georgescu, who was also placed on arrest pending trial on March 18, was indicted together with another 11 people. Georgescu is accused of having approved overvalued compensation for property confiscated by the former communist regime while working at the National Agency for the Return of Property. Damages to the state are estimated to stand at 84 million euros.
Verbal hostilities continue between Russia, NATO and Romania
Romania is a trusted ally of NATO, and NATO will defend all its allies against threats of any kind, reads a NATO press release made public on Wednesday. The statement is a reaction to the accusations formulated by a Russian Foreign Ministry spokesperson targeting Bucharest. NATO believes that Moscow has violated international law and failed to observe the commitments provided for in the NATO-Russia founding act by means of its ingressions in Ukraine and its repeated defying statements, which are ungrounded, highly inappropriate and only undermine stability and predictability at EU level. According to the Russian Foreign Ministry, the Romanian Government is forfeiting regional security by hosting the deployment of NATO forces on its territory. Prime Minister Victor Ponta has hailed NATO’s reaction to the position of the Russian official, saying that Romania, as a NATO member state, will only take decisions that are fair and appropriate for the security objectives of Romania and NATO. NATO’s standpoint in the matter fully reflects Romania’s position, Romanian Foreign Minister Bogdan Aurescu also said in Bucharest.
