The Week in Review: June 8-12
A look at some of the main stories in Romania this week.
Roxana Vasile, 13.06.2020, 14:00
The COVID-19 pandemic continues to grab
headlines
The number of
people infected with SARS CoV2 in Romania continued to go up this week, close
to the 21.000 mark. Nearly 1.400 people have died. After a state of emergency
spanning two months and a state of alert due to expire on June 16, President
Klaus Iohannis and the Liberal Government in Bucharest want to extend
restrictions.
On Thursday
evening, the Government postponed a decision in this respect for next week.
Prime Minister Ludovic Orban said extending the state of alert is not a
political decision. This move is vital to Romanians’ health and
well-being. Shopping malls will reopen
their gates, whereas any restaurants, cafes and playgrounds inside will remain
closed. Gyms and outdoor pools will open too, under special circumstances.
Private events have received the greenlight, with the guest list totaling a
maximum of 20 participants seated inside and 50 outside. Private after-schools
and nurseries will also resume their activity. According to the Prime Minister,
the National Institute for Public Health will rate each country in terms of the
evolution of the COVID-19 pandemic. People returning to Romania from countries
rated below 5 will no longer have to stay home in isolation. Flights are also
expected to resume to countries rated below five, such as Austria, Greece or
Bulgaria.
Parliament
will have to vote on extending the state of alert 5 days within the Government
announcing the decision. The Social-Democratic Party in opposition, currently
holding the majority in Parliament, announced its intention to vote against, as
it has its own strategy for containing the pandemic. The Social-Democrats did
say they would vote in favor of extending the state of alert, if certain
conditions are met. The list includes the reopening of hospitals for the
chronically ill and of those hospitals that were converted into pandemic
support units. The Social-Democrats also want the Government to restart public
tenders and eliminate derogations for filling up vacancies. The Social
Democrats believe face masks should remain mandatory in enclosed spaces, as
should social-distancing and public events with a limited number of people. In
turn, the Save Romania Union favors the extension of the state of alert for
another 15 days only in those towns and villages where the risk of infection
remains high. President Klaus Iohannis has called on MPs to understand that the
Government cannot keep the pandemic in check if it doesn’t have the necessary
means.
Romania’s economy – where to?
Barely has
the COVID-19 pandemic struck its first blow, that some officials in Bucharest
are already talking about a second wave, to the disgruntlement of those
criticizing the lack of economic recovery measures. Romanians are expecting a
concrete plan, something which the Liberals have promised would make public by
mid-June.
According to the Social-Democratic opposition,
hundreds of thousands of Romanians are unemployed. The trade deficit has gone
up 21% compared to the similar period of last year, and the only program
launched by the Government to help support the economy, SME Invest, has had
subpar results. Under the program some 540 million euros have been invested so
far, tantamount to some 3.400 loans being taken out. This means the
Government’s aid accounts for 0.25% of the GDP, targeting a mere 0.67% of the
total number of SMEs, the Social-Democrats say.
The
Government retorted, saying it would introduce a law patterned on the SME
Invest program, one which they say will be more successful. The new program
will guarantee loans for large enterprises as well and will become operational
once the European Commission gives its go-ahead, which is expected within two
weeks at the most. The Liberal Government says this program, jointly with SME
Invest, will help nearly all Romanian businesses access financing loans. In a
message conveyed on Entrepreneur Day, Prime Minister Ludovic Orban said his
Cabinet will focus on boosting investments and local capital, and on ensuring
the operation of institutions that safeguard a free and equitable market for
businesses.
Standard & Poor’s maintains Romania’s
BBB- credit rating
Standard &
Poor’s maintains Romania’s BBB minus credit rating and the negative outlook with
respect to its economy. This means Romania has avoided a downgrade to ‘junk’,
which would have kept investors at bay. Standard & Poor’s also expects the
Romanian economy to shrink by 5.5% this year, after previously forecasting a
3.5% growth rate. Finance minister Florin Citu says the current Liberal
government took the right measures to combat the effects of the Covid-19 crisis
and ensure sustainable public financing.
The Liberals are
also rejecting the criticisms made by the Social Democratic Party, saying the
latter is trying to bankrupt Romania through the populist measures it initiated
in Parliament. The Social Democrats, who were in power until last November, are
saying, however, that the only reason why Standard & Poor’s has not yet
downgraded Romania’s credit rating is the efficiency of their own government
and because the Liberal government concealed their incompetence by committing
to austerity in a letter. According to the government, pensions may only rise
by as much as 10% this autumn, compared to the 40% provided for by law. (Translated by
V. Palcu & C. Mateescu)
