COVID-19 and Trump’s indifference helped human rights abusers in 2020
Durov rejects Western funds’ offer to buy 5%-10% of Telegram with $30bn valuation
Belarusian government sees $2bn of withdrawals, issues $580mn worth of bonds in 2020
Lukashenko: I am no enemy of the people
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New Ukrainian VC firm QPDigital aims to invest up to $100 million in digital startups
EBRD investments reach record €11bn in pandemic-struck 2020
FPRI BMB Ukraine: Most Ukrainians are optimistic about 2021 – poll
OUTLOOK 2021 Lithuania
EBRD says loan to Estonia’s controversial Porto Franco project was never disbursed
Estonian premier quits after Tallinn development scandal
Top Centre Party official suspected of corruption in Tallinn real estate scandal
Czech Pirates and Mayors approve final coalition agreement for 2021 elections
OUTLOOK 2021 Czechia
BRICKS & MORTAR: Rosier future beckons for CEE retailers after year of change and disruption
Romanian tech entrepreneurs expand into banking sector
OUTLOOK 2021 Hungary
Hungarian government remains silent after Capitol riots
Storming parliaments: New Europe's greatest hits
World Bank expects modest recovery for Europe and Central Asia in 2021
FDI inflows to CEE down 58% in 1H20 but rebound expected
OUTLOOK 2021 Slovakia
Slovakia to invest €1.2bn in digitisation
BALKAN BLOG: The controversial recipe for building up Albania
Heavy flooding causes chaos in parts of Southeast Europe
Vodafone Albania plans €100mn infrastructure investments after AbCom merger
OUTLOOK 2021 Albania
Kyiv accuses Bosnian President Dodik of lying about icon gifted to Russian foreign minister
Bosnia’s real GDP contracts 6.3% y/y in 3Q20
Sofia-based LAUNCHub Ventures holds first close of new fund on €44mn
ING THINK: Growth in the Balkans: from zero to hero again?
OUTLOOK 2020 Bulgaria
Labour demand down 28% y/y in Croatia in 2020
Zagreb Stock Exchange's Crobex10 index at highest level since March 5
OUTLOOK 2021 Kosovo
Arrera Automobili aims to launch Albania’s first supercar
World Bank revises projection for Moldova’s 2020 GDP decline to 7.2%
Moldova’s PM resigns to prepare the ground for early elections
Socialist lawmakers in Moldova scrap settlement on $1bn bank frauds
Montenegro’s new ruling coalition carves up top state jobs
OUTLOOK 2021 Montenegro
Vast tide of floating waste threatens Balkan hydropower plants
North Macedonia's manufacturing confidence indicator down by 8.5 pp y/y in December
OUTLOOK 2021 North Macedonia
Transparency International warns of high corruption risk in CEE defence sectors
Moldova fears flooding from Ukraine's planned Dniester hydropower plants
Romania’s industrial recovery paused in November
OUTLOOK 2021 Serbia
Slovenia’s opposition files no-confidence motion against Jansa cabinet
Slovenia’s government to release funds to news agency STA after EU pressure
UK Moneyhub picks Slovenia for post-Brexit European base
Slovenia’s dire COVID-19 situation in 4Q20 caused second economic dip
BEYOND THE BOSPORUS: Let’s tentatively pencil in a date for Turkey’s hot money outflow
Turkish opposition leader lawsuit demands one lira from Erdogan, police probe “bald” interior minister posts
OUTLOOK 2021 Armenia
Armenia’s PM cautions conflict with Azerbaijan “still not settled” after trilateral meeting with Putin
COMMENT: Record high debt levels will slow post-coronavirus recovery, threaten some countries' financial stability, says IIF
Russia, Kazakhstan pushing for oil production increases on the back of coronavirus vaccine-fuelled oil price optimism
OUTLOOK 2021 Georgia
Georgia’s political kingpin Bidzina Ivanishvili quits politics
Modern-day “Robin Hood” inspires Georgians drowning in debt
Iran’s navy conducts missile drill while analyst argues Trump even capable of nuclear strike in final days
TEHRAN BLOG: Who’s more credible? Johnson backing Trump’s Nobel chances or Iran applauding arrest warrant for US president?
Central Asia vaccination plans underwhelm, but governments look unruffled
Fears of authoritarianism as Kyrgyz populist wins landslide and backing for ‘Khanstitution’
OUTLOOK 2021 Kyrgyzstan
Mongolia's winter dzud set to be one of most extreme on record says Red Cross
Mongolian coal exports to China paralysed as Beijing demands virus testing of truck drivers
Mongolia fears economic damage as country faces up to its first local transmissions of coronavirus
Mongolia in lockdown after suffering first local coronavirus transmissions
OUTLOOK 2021 Tajikistan
China business briefing: Not happy with Kyrgyzstan
OUTLOOK 2021 Turkmenistan
Turkmenistan: How the Grinch stole New Year
Turkmenistan: The dammed united
COMMENT: Uzbekistan is being transformed, but where are the democratic reforms?
OUTLOOK 2021 Uzbekistan
Uzbekistan’s Makro positions itself for growth in a more competitive market
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Question: Hello - did you see Isarescu commenting on a potential ideal gap between the policy rate and inflation during the Q&A pls?
indeed Isarescu touched this topic. But it was about the gap between inflation and money market interest rates [not policy interest rate].
What he clearly said, was that no one should expect the interest rates to rise in line with inflation soon [this would be bankers' wishful thinking, he implied between the lines]. He also mentioned that the [nearly] 2pp between the interest rates and inflation in Europe [euro area] is same in Romania [more or less, with the gap wider in Romania judging by numbers] at this moment. He did not say whether the gap will remain the same, but he implied that the developments in Romania should [and he stressed, in his opinion] converge to the developments in Europe. Both the interest rates and inflation in Romania should converge to same levels as in Europe , he also added. Isarescu also mentioned debates among monetary board's members about the process of normalisation of the monetary policy in Europe -- by normalisation meaning the return to real positive interest rates, sterilisation and monetary transmission mechanism as we know it. It is a process that impacts Romania significantly, he stated, and its dynamics is still unclear. [such normalisation would compress the 2pp gap and in fact, eventually, turn it negative -- our comments here ] In conclusion, the 2pp gap should be regarded as a dynamic target -- likely to follow the developments in the euro area. Because otherwise, combined with the 3.5% y/y yearend conflagration target it would result in 1.5% interest rates at the end of the year [which is unrealistic].
The bottom line: Isarescu's comments were not about the policy rate, but about the interest rates.
whole speech here https://www.youtube.com/watch?v=ttY05QnX034 with the para mentioned starting min45
Question: Are Sobchak and Navalny the only opposing Putin in the election? And how large is the popular support for these candidates (estimated)?
Answers: Thank you for your question.
Up to now Alexei Navalny and Xenia Sobchak are the only ones to announce the intention to run for president in 2018. Their poll numbers are negligible at 1-2% and they both are still to comply with the red tape required to register a candidate. Navalny also has a criminal conviction in the Kirovles corruption case that might deter him from the race.
On November 20 Interfax reported that veteran ultranationalist politician Vladimir Zhirinovsky of the Liberal Democratic Party of Russia (LDPR) will be running for president for the sixth time. The leader of the Communist Party of Russia (KPRF) Gennady Zyuganov was also planning to run, according to unconfirmed reports. Their poll numbers are at about 3%.
It must be noted that Vladimir Putin, whose approval ratings have been record-high at over 80%, has yet to announce that he will be running for president in 2018, whether as a candidate of the ruling United Russia party, as an independent candidate, or in some other quality.
In the highly likely outcome of Vladimir Putin running for president, the greatest other threat to his re-election is perhaps public apathy or indecisiveness, with recent polls showing that over 40% of Russian don’t know who to vote for, or whether they would vote at all.
bne IntelliNews team
Question: Is the sanctions targetting both gas and oil pipelines?
Answers: Thank you for your question.
In accordance with the latest US State Department guidance, "the focus of implementation would be on energy export pipelines that (1) originate in the Russian Federation, and (2) transport hydrocarbons across an international land or maritime border for delivery to another country." [https://www.state.gov/e/enr/275195.htm]
We would assume hydrocarbon includes both oil and gas, but a deeper dive into the wording of the Sections 232 and 231 of the Countering America’s Adversaries Through Sanctions Act (CAATSA) would be required to definitely answer your question.
bne IntelliNews team
Question: Where can I find the details of the proposed budget bill, such as the assumptions behind the estimates (e.g. what the Ministry of Finance is forecasting for government revenue/expenditure growth)?
Answers: Thank you for your question. The basics of the budget are provided by the finance ministry here: http://bit.ly/2xypdvi, while you will find the proposed budget bill in its entirety (unfortunately it's three zipped file catalogues containing several files each) here: http://bit.ly/2wMOH3p. There is no detailed information in English. The PM's office only published this snippet: https://www.premier.gov.pl/en/news/news/prime-minister-beata-szydlo-pro-community-and-pro-development-budget-for-2018.html.
Question: hi has there been any new estimates or official comments on the cost and details of the potential change affecting households' taxation next week? thank you
we are very far from any evaluation of the still uncertain changes in the income taxation. the baseline scenario remains that limited if any changes will be implemented as of January 2018, given the short time and the current state of discussions. Possibly the social security contributions would be unified (employee and employer) and tax payers might have to fill some wealth statements. These are the most realistic ideas of the many circulated so far. political promises of cutting the income tax rate from 16% to 10% were voiced recently (last week) -- but they were not confirmed yet by government and will probably be deferred amid rising budget deficit accumulated in the second part of the year.
the government's plans for taxation in general and for income taxation in particular have changed frequently during 2017. The initial plans for "household income taxation" was abandoned and replaced with "global income taxation". Global taxation of course makes no sense in the context of the flat tax rate -- but the government said that it would extend deductibility for certain expenses, and this explains everything. At the same time, ruling coalition's head Liviu Dragnea mentioned a wealth statement for each individual -- while technically difficult, this reminds rather of politicians' frustration with filling such statements on an annual basis. Technically, it looks like the government aims at cutting tax evasion by these statements -- but, again, in an indirect way that bypasses the normal way of addressing tax evasion.
The discussion about income taxation was recently obscured by other fiscal innovation planned: Split VAT. There is no draft for such plans, though [as it was no draft for the opther plansL housheold taxation, or corporate income taxation -- another idea abandoned by the government]. At this moment, in the area of income taxation, the government wants to (legally) move the social security and healthcare contributions to employee [while technically the payments would be processed by employers]. The impact should be neutral on both side: employer and employee. But legally this might be difficult to be enforced in the private sector, tax experts warned. While we believe this might not be that difficult to be enforced (such public statements, including by tax experts, tend to be politi8cally biased), we see little gains and a lot of technical complications from this innovation. But it is not impossible (as it was in the case of household taxation, or corporate income tax - -two obviously impossible models that have been still discussed seriously by both government and tax experts). Employers would have to increase the gross wage with what now is "total labour cost" by including their contributions to social scurity and healthcare systems. All in all, the net wage and the socials security contributions should remain the same. Notably, in the public sector: the promised 25% gross wage hike as of January 2018 strangely matches the increase from the gross wage top total labour cost [some speculated that in fact the government actually wants to have the two offsetting with neutral impact on the public wage payroll -- whichis already rising too much after repated wage hikes.]
finally: there is a general view that the authorities are trying to reverse the post-election spending exuberance [that came on the top of last year's pre-election exuberance]. In fact, it looks more like the government's more rational views prevailing over the political rhetoric generated by the majority leader Dragnea. It remains unclear whether there is a genuine conflict between the two views, or is a continuous bargaining.
Question: hi - what wage demands do you see anecdotally in Poland now?
Thank you for your question. Based on some recent news, the Solidarity trade union planned a strike in early May in protest against the Biedronka retail chain’s wage policy. Unionists were demanding the lowest pay in the chain to be set at a minimum of PLN2,000 (€470) net. Higher up the pay hierarchy, such as in IT segment, however, anecdotal data suggest expectations are for at least PLN5,000-6,000 net. According to a recent report by the National Bank of Poland (NBP), there are growing wage expectations from the unemployed, which is increasing the overall pressure on wages. In 2017, the growth in wage expectations has come in at 5.6% y/y in the first half of the year. On the other hand, wages growth is hindered to an extent by the influx of cheaper labourers form Ukraine, although their wage demands are reportedly growing as well.
Question: Hi could you elaborate on what exactly the government can do to the courts pls?
Answers: Thank you for your question. The concern shared by constitutional experts is that by giving itself decisive influence on appointing court judges - including the judges of the Supreme Court - the government will be able to exert direct political influence on top court cases that are important to it or even, as the Polish ombudsman pointed out, in petty cases involving citizens versus functionaries of the ruling party who will have the advantage of having party-appointed judges sitting not only in some courts, but along the entire process of appeals in fact. With Supreme Court, the concern is also that - since Supreme Court decides on validity of elections - it will simply stamp out on the election result even in the case of PiS' rigging the vote. While rigging election never occurred in Poland after 1989 and remains a hypothetical scenario at the moment, there is concern the ruling party will indeed try to cement its rule.
Question: hi - could you remind me at what level does the solidarity tax supposedly kicks in and at what rate? also, have you seen any indications of revenue thresholds for the "new" corporate tax system under review?
Answers: the solidarity tax is supposed to be leived above 10 time the minimum gross wage per month [minimum gross wage is currently RON1,450/€315]. No information is available about the intensity/rate of the solidarity tax. As regards the turnover tax, there are three levels contemplated 1%, 2%, 3% but it is not clear on what basis the companies will be differentiated -- by turnover, or sector.
A final decision about the possible replacement of the corporate profit tax with a turnover tax will be made only after Romania’s Prime Minister Mihai Tudose receives the evaluation of the impact of such measure, hotnews.ro informed quoting on July 3 unofficial sources.
The information confirms broad expectation that the key measures included in the revised Ruling Strategy issued by the ruling coalition along the new government headed by PM Tudose will either be significantly revised, or will never be enforced. Other measure unlikely to be enforced is the special tax to be levied on very high wages. Such a special tax was mentioned in the Ruling Strategy with no details such as the intensity of the tax and the level above which would it be levied (ten times the minimum wage was proposed government officials).
PM Tudose would reportedly not agree a flat turnover tax, but a gradual one “and only for certain economic sectors”, hotnews.ro sources said.
However, the revised Ruling Strategy of the coalition, published in the Official Journal, stipulates that “we will introduce the turnover tax for all companies in Romania starting with January 2018. This tax will replace the profit tax and there will be two or three different levels of taxation” . Indeed, the Ruling Strategy does not specify how high would be the turnover tax rate, but levels ranging from 1% to 3% were circulated with the lowest expected to be charged to small and medium sized companies
Question: hello - the moodys report referred to a presentation on the growth / taxation strategy of Poland going forward from minister morawiecki delivered recently. have you seen it/ do you have a copy pls? thank you
Answers: Thank you for your question. The forward plan for the Polish finances is contained here: http://www.mf.gov.pl/documents/764034/5874533/20170428_WPFP_2017_2020.pdf. It's in Polish at the moment, but you can check in on this website for the English version, which should be published before long: http://www.mf.gov.pl/en/ministry-of-finance/poland-in-eu/convergence-programme
Question: Hello, do you know if there are major investment plans that started at the beginning of the year of private or publicly influenced companies? thank you
This is a very broad field of inquiry, but here are some of the stand-out investments that we have covered so far this year:
Oil & Gas
among many others.
bne IntelliNews team
Question: Hello, what have you heard about a recent official commenting the possibility of nationalisation of the private pension system please? also, for the wage bill, if i read your article correctly then the additional increase of 1.25% of GDP would take the deficit to over 4% of GDP? last question, could you confirm how much is the under management by the private pension funds in % of GDP and how much are the annual inflows transferred to them? thank you
Answers: To start with, finance ministry Viorel Stefan denied allegations about planned nationalisation of the IInd pillar of the pension system, on April 12. The allegations were circulated (in rather general terms) by the largest pension fund manager, NN, which issued a newsletter to its customers on April 11. On April 12, MP Serban Nicolae (PSD, senior ruling party) summoned head of the financial markets supervisory body ASF, Misu Negritoiu, to explain the situation. This comes in the context of Negritoiu being proposed for dismissal last year after the crisis in the insurance system. Some MPs might attempt to resume the procedures for the replacement of Negritoiu. In any case, both Negritoiu and finance ministry Stefan firmly denied such plans, stressing that such an option was not discussed.
Indeed the recent developments [or rather the public debates] related to the fiscal policies in Romania deserve attention.
Summing up: the ruling coalition has passed a series of wage hikes (and other social benefits, plus cutting some non-fiscal fees), inked a problematic public wage bill (this is not sent yet to Parliament) and, more recently, announced broad reforms on the fiscal system.
This latest move (the “household income tax” that would allow households to deduct certain expenditures like for education) is the most puzzling, but at least the senior ruling party did not published a draft of it. Nonetheless, PSD still claims the revised fiscal system would be enacted as of January 2018 -- which is highly unrealistic, not to mention the vagueness of the concept of “household” mentioned by the ruling coalition officials (including finance minister Stefan).
Now about the nationalisation of the IInd pillar of the pension system. Indeed, the largest fund manager (NN, formerly ING Nederlanden) informed its customers about “public debates on this topic”. NN also informed its recipients that “their rights could be impacted by diminishing (or cutting to zero) the share of the social security contributions earmarked to the IInd pillar”. NN promises “to take all the necessary steps in order to defend contributors’ rights”. It was not a formal warning about the imminence of such a step taken by the government. However, such information can create panic instantly. Even if the nationalisation in itself can be carried in totally fair manner. The term is given a particular negative meaning in Eastern Europe, where the communist regime in fact took assets from wealthy persons with no fair compensation (actually no compensation at all) calling this nationalisation. It is hard to explain that the IInd pillar can be transferred back to state with all the necessary regularisation of contributors’ rights. This is exactly why such a nationalisation will most likely not take place. The fund managers (defending their interests) could easily generate panic and mass protests. But NN’s newsletter was not issued with no grounds.
On April 1, MP Catalin Predoiu (opposition) accused the ruling coalition about plans to nationalise the IInd pillar. At a very private level, among members of the ruling coalition, the option might have been discussed in the context of similar moves in countries in the region. In any case, Predoiu’s comment prompted speculations from mass media. This seems to have triggered NN’s warning, unless NN officials have inside information from the government.
Based on existing public information, it is very early to say whether the government will have to rely on extreme measures such as the nationalisation of the IInd pillar. Freezing or cutting the contributions to IInd pillar would be an intermediary step., indeed possible. In fact, it would not be for the first time, since the percentage contribution to IInd pillar was increased at a slower rate than initially planned. The contribution to IInd pillar was maintained at 5.1% (of gross wage) in 2017, for the second year in row (it was 5% in 2015). Government promised to rise the ratio to 6%, in 2018. Technically, the state transfers part of the contributions to the private managers with no change on the overall taxation.
As regards the 1.25% part of question, it is assumed that the wage hikes will take place since 2018 (and not this year). It is premature to estimate the impact of the public wage bill, in fact it is possible that the ruling coalition gives up the idea completely within several days. But the logic of the 1.25% was that next year (versus 2017) the public payroll will increase by 1.25% 9of the current GDP and indeed roughly of next year’s GDP). But the deficit is driven by many factors. It is better to think in terms of public payroll. It is estimated to rise from under 8% currently to some 12% in 2022, according to the fiscal council. This puts 4% of GDP pressure on budget. But revenues-to-GDP can increase and other expenditures can be cut. Furthermore, the discussions related to the bill go further than the impact on the budget and having it submitted to parliament next week seems unrealistic. By the law, any bill (not to mention this one) ought to have a section dedicated to the impact on the budget. This one does not have.
Question: Does the Russian government have plans to auction off more mining licenses in the near future? Any idea what they still control? There are a very small number of junior miners operating in what is such a massive, resource-rich land expanse (namely Siberia and Far East).
Answers: Thank you for you question.
The next auction announced by the state natural resources agency RosNedra will take place on May 16. Exploration and extraction licence on eight mines in the Yakutia Republic will be auctioned at a starting price of RUB168mn, not including the participation fee.Link to the announcement (in Russian): http://www.rosnedra.gov.ru/article/9061.html
The full list of all mines approved for auctioning in 2017 can be found here (in Russian): http://www.rosnedra.gov.ru/article/8976.html
The information on all the state auctions can be found on the website of RosNedra [http://www.rosnedra.gov.ru/] and state procurement database Torgi.gov.ru [https://www.torgi.gov.ru/lotSearch1.html?bidKindId=5]
bne IntelliNews team
Question: just out of curiosity, how did Kadiev do in the election? I believe he was running as an independent for a parliamentary seat...
Answers: Kadiev won 2,270 votes or 0.06%.
Question: recent opinion polls pls for Poland?
Answers: Thank you for this question. Polls are largely unchanged, with the ruling Law and Justice (PiS) leading at an average of 34% (that's the average from December polls by six pollsters). Liberal opposition Nowoczesna (Modern) is second at an average of 18.8% - thanks to a surprise result of 24% in a poll carried out on december 22 by Millward Brown. Another liberal opposition party and the previous ruling party, Civic Platform (PO) is third at an average of 16.5%. The only other party that is above the 5% threshold above which parties win parliamentary seats in Poland is populist/nationalist Kukiz'15 at an average of 8.7%.
Other parties - including two leftist groups SLD and Razem, as well as PO's former coalition partner PSL - are below 5% in recent polls, although SLD is just below the line at 4.6%.
Question: recent opinion polls pls?
You can find regular opinion poll updates here: http://republikon.hu/elemzesek,-kutatasok.aspx or here: http://www.zaveczresearch.hu/a-partok-tamogatottsaga/
The latest opinion poll released by Republikon on December 27 shows the following results:
Support for political parties in December (% of population):Fidesz: 31%; Jobbik: 12%; MSZP: 11%; DK: 3%; LMP: 2%; Egyutt: 1%; PM: 1%; Undecided: 39%
Support for political parties in December (% of decided voters): Fidesz: 50%; Jobbik: 19%; MSZP: 18%; DK: 5%; LMP: 3%; Egyutt: 2%; Liberalisok: 1%; PM: 1%; Other parties: 1%
Question: I'm sorry, but if this is in reference to the story found here: http://foreignpolicy.com/2016/12/20/russia-missing-from-trumps-top-defense-priorities-according-to-dod-memo/ then this article is a woefully inaccurate and misleading summary. And it's particularly egregiously bad because the full source document is linked in the Foreign Policy article.
Answers: hi thanks for point this out. our story was sourced from Russian press and I think that sense got lost in translation a bit. but now we gone to the original source and linked to the memo. so shoudl be fixed.
Question: Hi - what is the policy plan of USR and do you think they will accept to be in a coalition with PNL?
in brief, the policy plan is reforming public administration and finding best experts to appoint in key position and manage them transparently. There are good chances that USR accepts PNL's invitation, but only as part of a three-party constructions having PM Ciolos as partner. The scenario is feasible given the disarray within PNL that allows USR promote much smoothly planned reforms. USR will probably avoid being the junior partner of a ruling coalition that would nominate a PNL member for the PM seat.
USR is a new party with good, yet very vague, intentions. It focuses on moral values and transparency. It is fair to assume that they have no hidden agenda, but it is still unclear what is the structure and credibility of the regional organisations set up quickly over the summer. Though their good intentions cannot be challenged, their capacity to pursue reforms, particularly in partnership with another, more experienced party, must be proven. Under the optimistic scenario, USR-PNL coalition would stimulate the much-needed internal reforms within PNL. Under the pessimistic scenario, the coalition (assuming the two parties form the majority) would not function and lead to political crisis, eventually the formation of an alternative PSD-led majority. We have in the past the example of 1996-2000 term, when idealistic Conventia Democrata has formed the ruling coalition with the Democrat Party and failed to run smoothly – yet setting grounds for healthy economic developments after 2000.
USR must join forces with other parties, most likely PNL, if they want to be part of a ruling coalition. As opposed to USR, PNL has a history of debatable political coalitions (in terms of own ideology), questionable decisions (in terms of rule of law) and performance, as part of a ruling coalition. There were also many PNL leaders indicted and condemned for corruption, though Social Democrats lead by far in this regard. This does not fit the profile of USR’s ideal partner. But this complicated history of Liberals (a party with much longer history, dating since before the communist regime) also comes with a robust network of regional organisations, hands-on approach of elections (compared to the rather idealistic approach of USR) and an “inertial” support enjoyed in some parts of the country and among certain social categories. At first sight, the two parties might be complimentary – but this is the optimistic version of the story, or the full half of the glass.
The empty half is i. PNL not being in its best favourable stage of its history, and ii. possible conflicts generated by the very different profiles of the two parties.
PNL faces major problems since it broke the coalition with leftist PSD – though it should have on the contrary allow the party to gain credibility and strengthen its centre-right identity. Klaus Iohannis winning the presidential elections in November 2014 should have further help PNL pursue internal reforms. But the merger with Liberal Democrat Party (PLD) of former President Basescu was not yet completed at local level, it generates tensions and the incumbent party leadership lacks vision and strategy. Supporting PM Ciolos was the sole strategy in this electoral campaign and it is unclear whether this was a winning strategy.
Coming back to USR, the party also adhered to the also very vague platform Romania 100 of PM Dacian Ciolos. USR has own programme, but it is equally vague. As an extra-parliamentary party, USR did not have to express views on the wage hikes or fiscal policies. In fact, USR’s rhetoric focuses on moral values and transparency and on reforming the public administration. In fact, this would indeed unleash the growth potential, but the public administration is likely to oppose resistance. In brief, USR wants to fight corruption and find the best experts for defining very specific strategies like fiscal strategy, energy strategy, industrial strategy. Just like Romania 100, USR’s programme includes common sense statements.
The political plan was having both PNL and USR running in the parliamentary elections under the umbrella of Romania 100 platform. But this strategy seems to have failed and the lack of coherence between the two parties becomes increasingly visible. There are rumours being circulated about Liberals’ disappointment with their scores in the polls.
USR’s strongest point is its youth -- the new party was set up this year members with no involvement in politics or controversial businesses so far. And yet, controversies related to party’s financing have already occurred. Such allegations are however politically biased and not particularly credible. We see threats to party’s credibility
Since it is very young, it is not clear what is the profile of the regional organisations, whether they are as credible as the central leadership.
Question: Goodmornig, as far as I have understood, by accepting the amendments to the election code, the “do not support anyone” will be counted as valid in forthcoming presidential elections. Thus, they won't be excluded when calculating the candidate who gathered the highest amount of votes at the first round (as far as I know, previously, parties wanted to consider this vote only for the turnout). In this case, what happens if the “do not support anyone” obtains the 50%+1 of the votes? Thank you
Answers: Thank you for the question.
According to the electoral code, president (and the respective vice-president) is elected in the first round in case he/she has received more than half of the valid votes and the turnout exceeded 50%. The counting of “do not support anyone” votes will indeed make achieving such a result more difficult.
The code also says that in case no candidate receives such a support, there will be a runoff within seven days. Then, the voters will choose between the two candidates that had the best and second best performance in the first round.
However, in the runoff there is no requirement for receiving more than half of the votes. Instead, the code says that the elected candidate is the one who received the most votes. The counting of “do not support anyone” hence does not prevent the election of the president.
Question: Thanks for this article. Can you provide more details about what is proposed in the Romania 100 Platform?
Hello, thank you for the question on this topic.
The “platform” Romania 100 launched by PM Dacian Ciolos is essentially a political vehicle that helps National Liberal Party (PNL), Save Romania Union (USR), President Klaus Iohannis and its author – PM Ciolos, joint together under same umbrella without breaching the Constitution and without hurting the political egos (or ambitions) of the two political actors in the group (PNL and USR), ahead of the parliamentary elections. Indeed, the platform was backed by both PNL and USR, which expect to boost their combined scores and change the political balance that at this moment, according to the polls, indicate Social Democrat Party (PSD) would form the majority with its ally ALDE. We believe such a performance (changing the balance) is not unlikely, particularly as ALDE leader (also Senate’s leader) turned radical against anticorruption directorate DNA. Making anticorruption the core electoral debate helps new parties like USR or new political entities such as Ciolos’ platform. In fact, this might be another aim of the platform – diluting the identity of PNL as an “old” party, by the addition of USR and technocrats.
PM Ciolos said that the platform is for the use of any party winning the elections. This was another good marketing move. Social Democrat Party (PSD) accused Ciolos of plagiarism, claiming that all the strategies included in the platform are copy/paste from PSD programmes. And PSD leader Liviu Dragnea might be right, with the note that the general ideas expressed by Ciolos can be found in all the political strategies expressed in Romania over the past 25 year.
Structurally, the platform is designed in three layers: the first layer is for the marketing of the product, a series of ten “beliefs” expressed by Ciolos. They are designed to be strong statements (sort of political Decalogue), but some believe they are a bit excessive particularly in contrast to the "current" performance of the government of technocrats headed by PM Ciolos [the real performance of the government is likely to be measured with a lag].
The second layer describes what PM Ciolos would do as PM in the first 100 days of his new term: change the structure of the government, reduce bureaucracy and use IT extensively in public administration. Prioritisation of public investments and best use of EU funds.
The third layer outlines the main national projects that, according to PM Ciolos, should be pursued by any government. This means broader public administration reform, unification of the wage system in the public sector and the enforcement of the anticorruption strategy. Among the national projects there is a document drafted by the ministry of economy (Competitive Romania 2016). There are no radical ideas included (such as questioning the role of FDI, or renewable energy above certain threshold, or protectionism). Ideologically, the economic programme is rather of neo-liberal extraction, in line with IFIs recommendations.
Follows a translation of the platform (fast forward; if any clarification needed, please do not hesitate)
Layer I: the Decalogue
1. I support a corruption-free Romania
2. I support a Romania with a responsible political class
3. I support a Romania governed in good faith
4. I support a Romania where everyone works and receives fair payment
5. I support a Romania without poverty
6. I support a Romania with a competitive economy
7. I support a truly educated Romania
8. I support a healthy Romania
9. I support a Romania that has a voice as EU and NATO member
10. I support a Romania of all Romanians
Layer II: actions for first 100 days
Government must rethink ministerial-level functionality with a Cabinet formed by a handful of ministers, ministries merged with the principle of cluster development and a reduced number of implementing agencies and regulators. Restructuring central government by amending Law 90/2001 sanctioned by law on the organization and functioning of the Government, to include a model of internal organization for each ministry, explaining powers to eliminate the risk of duplication of tasks. Governance is built on cross-sectoral objectives, clearly assumed the benefit of citizens (eg coordinated investment, reduce poverty, reduce bureaucracy, administration digitization, modern infrastructure, etc.). #ComisiadeTaiatHartii 2.0 (paper-cutting committee 2.0) becomes an independent institution within the Government Chancellery reduce bureaucracy and continue their mission in support of the citizens, entrepreneurs and simplify inter-institutional relations. Institutionalizes government #GovITHub and Information Technology Coordinator. These institutions aim to ensure that IT investments of public institutions be made effective as a strategy and in the interests of citizens. Government strategies, public policies and legislative projects undergo an initial assessment of their impact when adopting or once every 3 years. Those who fail the test the effectiveness and impact ceases automatically. Consolidation of all national and European funds earmarked for development and a real multi-annual approach to their use. Budgetary funds which distributes money based on political clientelism without the basis of projects or plans for development and control mechanisms must be abolished. Clearly prioritized public expenditure, impact assessment. Be operationalized and strengthened the Chancellery institutional assessment unit public investment. All government investments pass through this filter.
Layer III: broad national projects
Public administration reform: amending Law 188/1999 regarding the status of public introduction of new criteria for recruitment, evaluation and their incentive. The objective is to create a public administration professional, competent, integrity, transparency, both at central and local level.
Changing the Framework Law 284/2010 on the unitary pay of personnel paid from public funds to eliminate discrepancies and discrimination between different sectors of the public sector.
Operationalization of the National Anticorruption Strategy, strengthening the National Agency for Administration of Goods seized (ANAB), Covenant multiannual financing and strengthening the judiciary.
Assuming and operationalization of the 17 chapters of Romania Competitive Strategy.
Creating a national program to support entrepreneurship as an engine of Romanian economy. Each dollar invested in public funds should support sustainable economic growth, quality, creating jobs and attracting private capital.
Continued anti-poverty package with budget allocation, legislative changes, deadlines for fulfilling commitments annually.
Legislative proposal to establish a multiannual financial framework, to ensure continuity of major investments in the economy by hiring multiannual budgetary resources. Romania's budget will be prepared to follow the program and objective, not the need for institutions to justify their existence.
Establishing a portfolio of investment projects of national interest, which benefit from European funds and national budget in health, education, infrastructure sea.
Prioritization of applied research, development and innovation as elements of growth of value added in the economy.
Encouraging the participation of the Diaspora in the economy through approaches such as "RePatriot" and follow-Diaspora Start-Up.
Review of legislation and creation of national forests program for the conservation and sustainable exploitation of them.
Reorganization of State Domains Agency in a structure that allows the purchase of agricultural land, land consolidation and reselling them to young farmers, so as to support local agricultural development, strengthen family farm, the associative forms and the middle class in the countryside.
A legislative package to encourage agricultural production and marketing (including export) of added value, the branch association and organization in agriculture and establishment of Agricultural Chambers as independent agricultural advisory structures and support for farmers, coordinated by them.
Continued investment in the cadastre of the country, especially for agricultural land.
Continuation and improvement of the program of prevention and risk management of earthquake and other natural disasters.
Continuing the change of perspective in the implementation of EU programs, with an emphasis on simplification, increased quality and impact of projects that they have funded programs in economics. Initiated development of innovative financial instruments using European funds.
Implementation of strategies for Integrated Territorial Investment from EU funds and national budget in the Danube Delta, the Jiu Valley, Moldavia, Rosia Montana-Western and identify other areas that require integrated intervention packages of public and private funds.
Training in optimal conditions Romanian Presidency of the EU Council in 2019.
Development of Bulgaria-Romania-Hungary pipeline Austria (BRUA) continuing the energy interconnection and strengthen the independence and energy security of the country.
Multi-annual approach to upgrading of the national historical and cultural heritage.
Supporting sports performance and development of a national program to promote mass sports.
Question: What is the latest on the missiles repositioning close to the Polish border?
Answers: Thank you for your question.
The latest official Russian comments on the movement of the Iskander-M missiles to the Kaliningrad region of Russia that borders with Poland and Lithuania came on October 8. Major General Igor Konashenkov of the Ministry of Defence told reporters that the deployment of this particular missile systems in the region has happened in the past and will continue in the future as part of Russia's scheduled military exercises.
No timeline for future exercises was provided. Earlier unnamed sources told Reuters that Iskander-M missiles were already transferred to Kaliningrad region during exercises in 2014.
Meanwhile, Polish defence chief Witold Waszczykowsky on October 10 called the Russian actions an "inappropriate response to what NATO does". There has been no further Russian response that we are aware of.
Best regards,bne IntelliNews team
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