A weekly digest of news and sport from Bucharest and around Romania
Arms scandal dents President’s popularity
Romanian President Traian Basescu suffered perhaps his worst week in almost five years in office as a scandal involving his brother, Mircea, threatened to de-road his reelection campaign. It was claimed in the press that the president’s brother is a major shareholder in a company that allegedly sold arms to a number of questionable regimes and groups, as well as winning lucrative contracts with Romania’s own military. The scandal was amplified on Thursday when it was revealed that Romania is the only European Union country not to have signed a Union-wide convention on arms sales.
Support for Basescu in opinion polls is now down to around 33 per cent: its lowest level since he was elected.
Zero tax rate for reinvested profit from October 1
Prime Minister Emil Boc announced on Wednesday that profits reinvested by companies of all sizes in all fields would be tax free from October 1st, 2009. The announcement met with mixed response from the business community, however, still smarting at the government’s imposition earlier in the year of a compulsory profit tax on all companies, even those which do not make a profit. Boc also announced this week that civil servants earning more than 2000 lei per month would see their salaries frozen for at least a year.
Overdue consumer debt balloons
The number of consumers behind with credit payments topped 600,000 this week, an all-time high, and an 87 per cent increase since December of last year. The total amount of consumer credit overdue by more than 30 days now tops 1.8 billion lei, around €426 million.
Romania has highest inflation rate in the EU
The European statistics institute, Eurostat, revealed that Romania has the highest inflation rate in the EU – a whopping five per cent. Romaian was closley followed by Hungary, where inflation currently runs at 4.9 per cent, and Poland, currently reporting an inflation rate of 4.5 per cent. The inflation rate for the EU as a whole in July was 0.2 per cent.
Last week the head of the IMF delegation to Bucharest, Jeffrey Franks, said that Romania’s GDP will drop 8 per cent to 8.5 per cent this year.
Also this week, the Economist Intelligence Unit published a major report on Romania’s (surprisingly) shrinking trade deficit: read it here.
Tandareni: The Romanian town growing fat on UK benefit fraud
A report in the Sunday Times claimed that large numbers of people living in the Romanian town of Tandareni were illegally claiming benefist in the UNited Kingdom. The report also contains accusations of people smuggling, including that of babies as young as three moonths. Full report here.
Bucharest real estate market nears total collapse
According to a report published on Monday by the estate agency Colliers, just 515 new apartments were sold in Bucharest in the first half of the year. A large number of new blocks around the capital remain empty or barely occupied. In a seperate report, local newspaper Ziarul Financiar claimed that work had come to halt on more than 45 per cent of Bucharest’s building sites due to a lack of finance.
Dog days may be numbered
Democratic Liberal MP Iulian Urban proposed legislation that would see Romania’s stray dog problem – at its worst in Bucharest but an unwanted fact of life in every town and city in the country – dealt with once and for all. Urban is proposing that all stray dogs captured and not claimed by an owner in 14 days be put down.
Madonna booed by Bucharest concert goers
Madonna performed in Bucharest for the first time on Wednesday, quite literally stopping traffic as almost 50,000 people descended on Parcul Izvor in the shadow of Casa Poporului. Though members of the local press fell over themselves to hail the show as the greatest ever seen in the Romanian capital, more objective observers (people who had paid a fortune for tickets) preferred to use the word ‘perfunctory.’ Madonna was booed copiously for speaking about the discrimination in Romania of gypsies and homosexuals, though local daily Adevarul reported that the crowd had in fact applauded her social acceptance speech. The dreadful organisation of the event was slammed by all.
Read Bucharest Life’s Madonna posts here.
Urziceni handed manageable draw in Champions League
FC Timisoara failed to make the group stages of the Champions League, beaten well over two legs by Vfb Stuttgart. Timisoara’s defeat leaves Unirea Urziceni as the only Romanian respresentative in this season’s competition. In Thursday’s draw Unirea were placed into a group with Vfb Stuttgart, Seville and Glasgow Rangers. Seville and Stuttgart start as favourites, but the group is perhaps the weakest of the eight and Unirea will be glad to have avoided far tougher sides.
Miscellaneous
Romania’s ambassador to Bulgaria was outed as an alleged former Securitate collaborator. Romanian railways (CFR) announced that it planned to make 11,000 workers redundant over the next few years. The Romanian leu ended the week at 4.215 to the euro, a tiny gain on a week earlier.
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