Romania Country Report Mar17 - March, 2017

April 4, 2017

The political tensions have further eased through March, but the activity of Romania’s government is still hindered by hardly functional political majority. A conflict within the junior ruling party resulted in the replacement of the deputy-prime minister Daniel Constantin. Politically, Constantin was not a relevant part of the balance within the ruling coalition and his replacement in the government’s structure brings nothing new. But the development show the magnitude of the unrest within the ruling coalition, still led informally by the leader of the Social Democratic Party Liviu Dragnea.

Economically, the fiscal slippage remain the main concern. The government promised to keep the deficit within the 3% of GDP this year, but it goes ahead with a multitude of measures with significant impact on the gap. Eventually, it is not the size of the gap that matters, but the focus of the public spending on public wages,, pensions and social spending at the expense of investments. As a measure of last resort, the government squeezes the state-controlled companies as much as possible, through dividends (even paid in advance) and the recovery of reserves. Transgaz thus has to rely on bank loans for investments after having paid the profit derived last to shareholders (basically, to the state). More clarifications are expected after April 25, when Q1 data will be released and compared to the targets.


To Purchase This Report - Click Here

Related Reports

Russia Country Report Sep17 - September, 2017

Russia’s economy continued to expand thanks to investment, which is mainly a function of continued infrastructure spending by exporters and the state, which, however, is not enough to offset ... more

Iran Country Report Sep17 - September, 2017

Iran’s economy has experienced an “impressive recovery” since international sanctions were lifted in January last year and delivered an annual economic growth of 12.5% in the last Persian year ... more

Belarus Country Report Sep17 - September, 2017

Belarus has been the last horse out of the gate in the economic recovery stakes but the recovery is underway now. Belarus' GDP growth of 1% in the first half 2017 is a good result, as many were ... more

Dismiss