Books on Romania
% of GDP
Update No: 098 - (01/07/05)
The Romanians, like most Europeans, are transfixed by what has happened in
France and Holland. Does this portend the end of their bid to join the EU by
Leaders of the EU have vowed to keep their commitments to countries lining up to
join the 25-nation bloc. In a draft Presidency Conclusion, the EU leaders
welcomed the signing of the accession treaty in Luxembourg on April 25th, which
allows Bulgaria and Romania to the EU at the beginning of 2007.
Both Bulgaria and Romania are now participating in the proceedings of the EU
policy-making bodies as active observers. In the draft conclusion the EU leaders
reaffirmed their commitment to full implementation of the Thessaloniki agenda,
which emphasizes that the future of the Balkans lies in the bloc.
"Moreover, in this process, regional cooperation and good neighbourly
relations will remain essential elements of EU policy," said the
The EU has been seeking to reassure aspiring candidates that its door will
remain open to them in the chaos that has arisen since French and Dutch voters
rejected the European Constitution Treaty.
The Balkan option still open
European Union leaders have said they will stick to their pledge to admit
Bulgaria and Romania, despite the crisis over the EU constitution and the bloc's
But despite welcoming the signing of their accession treaty, they have not
mentioned any accession dates. In draft conclusions for the Brussels summit, the
leaders remained cautious over the prospects for Turkey and half a dozen Balkan
countries lining up to join.
The centrist view
Luxembourg is a tiny and very rich country of one third of a million people. But
it was a founder member of the EU for all that in 1957, a signatory of the
Treaty of Rome.
Its Prime Minister, Jean-Claude Juncker, who was chairing the summit, was asked
if Romania, a country of 22 million people, could fear a delay.
"There is no predetermined will of the EU leaders to delay Romania's
accession," he said. "The accession treaty was signed. It will be
entirely respected, which means that Romania must answer in a timely fashion to
all the demands of the treaty. For the rest, EU member states will also respect
all the commitments and provisions of the accession treaty."
Romanian Foreign Minister, Mihai Razvan Ungureanu, said his country and
Bulgaria, which were both participating as active observers at the 16th-17th
June EU summit in Brussels, had received assurances of support from all EU
"Romania and Bulgaria are part of the club and so should they be
considered," he said. "As for enlargement in general, after gulping
this large chunk of political geography, we need some time to rest - quote,
unquote - this is the basic meaning of their words."
EU leaders were never expected to discuss enlargement at this summit
But French President, Jacques Chirac, reminded them that the main role of
the European constitution had been to make an enlarged Europe work better.
"In this new situation, can the EU continue to expand without us having the
institutions needed to make this enlarged EU work effectively?" he said.
There was an echo of a non-answer.
Three banks enter market
The standings of banks operating on the Romanian market is set to undergo
substantial changes by European integration time, as this year is expected to
see the sale of 37% in the Romanian Commercial Bank, the privatisation of the
National Savings Bank (CEC) and possibly, the merger of Tiriac Bank with HVB
Bank Romania, New Europe reported.
According to sources in the banking market, quoted by Ziarul Financiar daily,
businessmen Ion Tiriac is attracted by the option of a merger of Tiriac Bank, in
which he holds 92% of the stock, with the Romanian subsidiary of HVB Bank. The
parties made no comments with respect to this piece of information.
S&P boosts Bucharest City rating
Standard & Poor's Ratings Services recently raised its long-term issuer
credit ratings on the Romanian capital City of Bucharest to BB+ from BB. The
outlook is stable, the company said in a statement, New Europe reported.
"The rating action is based on the city's improving debt management,
increased implementation of much-needed infrastructure investments, and its
growing economy, which is supported by the commitment of the new central
government to step up economic and institutional reforms in Romania. This should
lead to further growth in city's budget revenues," said Standard &
Poor's credit analyst Felix Ejgel.
New Distrigas Sud owner wants to implement subscription
Gaz de France, the new owner of Romanian natural gas distribution company
Distrigaz Sud, is in favour of implementing the natural gas subscription and
would like to return to the invoicing system practiced in April and May, New
"We would like to implement the gas subscription in Romania, too. In case
the Romanian authorities wish so, too, we will cooperate," said Bernanrd
Arnaud, general manager of Distrigaz Sud. The new manager said that the natural
gas subscription does not represent a tax by which the supplier will finance its
"The subscription is a guarantee that the distributor will do its job
correctly, will ensure the network's maintenance and exploitation works. For the
consumer, the subscription is a facility ensuring the constant level of the gas
invoice throughout the year," Arnaud added. Implemented on April 1st, the
gas subscription was removed as part of the invoice and included again in the
price of the cubic metre of consumed gas following protest waves from consumers.
Currency and gold reserves rise to 14.37bn Euro
The foreign currency reserves of National Bank of Romania (BNR) increased by
338.8m Euro in May for a total level of 13.23bn Euro, the central bank said in a
statement recently, New Europe reported.
The growth was the result of 689.6m Euro inputs, representing foreign currency
acquisitions, revenues from the administration of the international reserve, the
modification of the minimal reserves of foreign currency of commercial banks and
yielding foreign currency to the state reserve.
Foreign currency outputs amounted to 350.8m Euro representing payments of
interest for the external public debt and following the developments in the
world price of gold its value increased to 1,136.2m Euro, taking the
international reserves of the central bank (foreign currency and gold) to over
14.37bn Euro, the statement read.
By end-2005 payments due on external public and publicity guaranteed debt will
amount to 1,001m Euro, according to the central bank.
EU to finance highway
Romanian Prime Minister Popescu-Tariceanu announced that the partnership for the
construction of a new highway on the Prahova Valley - involving the Romanian
State and three companies, Vinci, Strabag and Ashtrom-Riochmann - is about to be
rendered obsolete. Tariceanu said recently that the highway will be built, after
an international auction, with half of the financing coming from the European
Union, while the other half would be offered as a credit by the European
Reconstruction and Development Bank (ERDB), New Europe reported.
After announcing that the partnership was broken, Tariceanu came up with the
surprise: the European financing is non-refundable.