Apanova
BURSA 08.12.2017

CĂLIN RECHEA (translated by Cosmin Ghidoveanu)
 
mărește imaginea
     The hope of an accession as quick as possible by Romania to the Eurozone was dealt a heavy blow precisely on the National Day.
     A study posted on the ECB website, called "Real convergence in the Eurozone: a long term perspective", shows that the sole currency has not served as a catalyst for reducing inequality at all, but has in fact been a factor of increasing divergence between the economies of the member states (author's note: Paper Series no. 203, Real convergence in the euro area: a long-term perspective, with Juan Luis Diaz del Hoyo, Ettore Dorrucci, Frigyes Ferdinand Heinz and Sona Muzikarova as authors).
     Unlike other similar analyses with a similar topic, the authors study the process of convergence over the long term, based on series of macroeconomic data collected since the beginning of the 60s.
     Their conclusions are worrisome not just for countries that need to enter the Eurozone, according to European treaties, but also for the stability of the Monetary Union.
     "A number of countries in the Eurozone have begun facing the trap of non-convergence long before the creation of the Eurozone", the analysis by the ECB states, and "for countries in the Eurozone with convergence problems, it is of critical importance to improve their economic structures, by improving the relevant institutions and the governance".
     Real convergence is defined as "the process which leads to long-term growth of the GDP per capita in countries with low incomes towards the level of countries with high incomes" and depends on a number of factors such as capital, labor, total productivity, as well as the quality of institutions or governance standards.
     These aspects have been widely presented in the EU-COFILE seminar, recently organized in Sinaia by the NBR, the Romanian Banking Association (ARB) and Alpha Bank.
     Florin Georgescu, first-deputy governor of the NBR, stressed the importance of capital, but unfortunately supplied data which shows that "in spite of the advance of the companies' capital resources (in absolute numbers), the capitalization degree of Romanian companies has degraded over the last 20 years", while "capital is the engine of real convergence and economic development of the country".
     Moreover, a large number of companies are seeing negative own capital, "and the funding of the activity is done particularly through borrowing from shareholders".
     Why has it come to this? Because the total cost of capital, calculated as an average between the cost of capital brought in by shareholders and the cost of borrowing, has been and is deeply distorted by monetary policy.
     And that is not all. The fiscal policy and legislative instability are direct "aggressions", which are particularly harmful to SMEs, which anywhere else in Europe represent the main "engine" of the economy.
     Negative capital and the loans granted by the owners to their businesses are merely a rational response to the aggression and the uncertainties that it generates.
     A piece of news that recently appeared in the financial press underlines a fundamental problem of our economy, both in terms of capital and of workforce. The association of Independent Car Repairs Companies (ASSAI) sent a letter to the Chinese Embassy, by which they were asking for support for recruiting Chinese laborers, Profit.ro writes, according to the acute staff crisis.
     Experienced employees ask for net wages of 1,000 - 1,400 Euros, and the president of the ASSAI says that "it is difficult to guarantee such a salary to an employee each month, given the legislative and fiscal unpredictability, as they are presented by the Romanian business sector", because "in the relationship between the employee and the employer, the supply and demand mechanisms fail, because there are imbalances between the employees' demands and the employers' means". So the problem is not the wage itself, but guaranteeing it over the long ter.
     Under these circumstances, how can we talk about real convergence based on increasing the productivity of production factors? According to the definition, total productivity of production factors (TFP) represents the part of the total production that can not be explained only through the quantity of inputs in the production process, and its level is determined by the effectiveness and intensity of use of the production factors.
     The major differences over the institutional framework have heavily influenced the evolution of the determining factors of the real convergence, and the ECB economists have noticed that there is a very deep "chasm" between the initial expectations and reality.
     Starting from the initial revenue level of 1999, the ECB study shows that the difference between the real growth and the expected one was very high in 2015, especially for countries on the Southern edge of the Eurozone.
     In Greece's case, the real growth was about 23 percentage points below the expected one, and for the group of countries on the Southern edge the negative difference is about 12 percentage points. The surprise is represented by the particular performance of the Baltic Countries and Slovakia, countries which have joined the Eurozone after 2002.
     According to the classification from the analysis of the ECB economists, countries in the core of the Eurozone are Belgium, Germany, France, Holland, Austria and Finland, and the group of countries on the Southern edge includes Spain, Greece, Italy and Portugal.
     The discrepancy between reality and expectations surprises even more when we note that since the beginning of the Eurozone, diverse economies such as Germany, Holland, Greece, Spain, France or Italy have seen a common growth trend, as shown by the evolution of the real GDP.
     Something "broke" after the entering in the Eurozone. Italy's "performance" is explained by ECB economists through the quality of its institutions and the structural problems of the economy. In their opinion, the effects of the global financial crisis only partially explain the evolution of the 4th economy of the Eurozone.
     Even though France is included in the core of the Eurozone, the evolution of its economy was closer to that of the Southern edge of the Eurozone. Patrick Artus, chief-economist of investment bank Natixis, recently wrote that there are no signals concerning the stopping of the process of deterioration of the economic situation of France and Italy, a process which for France began 20 years ago.
     The measures proposed by Artus, such as the gradual cutting of wages and massive corporate tax cuts, are impossible to apply politically, and the conclusion of the French economist is that the deindustrialization process will continue in the two countries.
     The analysis of the ECB also features some explanations concerning the evolution of the countries on the Southern Edge of the Eurozone, which are particularly significant for the Romanian economy as well.
     The authors write that after the move to the common monetary policy, up until 2007, countries such as Greece or Greece or Spain only saw a "temporary convergence", but the growth over that period proved unsustainable, as it was the result of the accumulation of internal and foreign imbalances and of the flawed allocation of resources.
     "The accelerated growth of internal demand supported by lending led to the overestimation of the potential for economic growth", the study of the ECB further shows. It is superfluous to point out that the same phenomenon has been visible in Romania in the period prior to the crisis. It is still visible now.
     "The risks generated by the accelerated increase in spending and of the degree of indebtedness have not been treated adequately by the authorities", the ECB economists further write. The situation once again fits Romania to a tee. Moreover, "the macroprudential instruments for limiting the excessive indebtedness were not used or were too weak to temper the expansion of lending in those economies". What else is there to say?
     Another phenomenon that is particularly worrisome noted in the analysis of the ECB concerns the ineffectiveness of the foreign capital inflows when it comes to "stimulating sustainable convergence". After writing that "capital inflows in the period prior to the crisis were directed towards the acquisition of debt instruments or were poured into the economy through the banking system", the authors reach the conclusion that "they did not result in a process of productivity convergence". The reason of course being the directing of most of the capital inflows to the real estate market.
     This type of "imbalanced growth" unfortunately has been a fundamental characteristic of the Romanian economy for more than ten years and shows us that we would need several years of preparation before joining the Eurozone.
     NBR officials present in the EU-COFILE seminar tried to be optimistic concerning the chances of accession and were absolutely "exuberant" when it comes to the accession timeline. The optimistic scenario, namely the accession in 2023, seems a fantasy to say the least, after the publication of the analysis of the ECB, and the maintenance of the current political class "guarantees" that the "mirage" of the Eurozone is very far in the future. If we accession is "forced" now or in the coming five years, Romania will at best be sentenced to stagnation.
     In the annual speech about the state of the European Union, European Commission president, Jean-Claude Juncker, launched the idea of the quick entry of all the member countries into the European Union as well.
     German professor Hans-Werner Sinn, former president of the Ifo institute and the author of the book "the Euro trap", compares Juncker to the head of a group of travelers who are heading towards a castle on the horizon, but the path they have taken leads somewhere else, and the only advice of the leader is that they should pick up the pace.
     In the article "The map of Jean-Claude Juncker for the European disaster", published on the Project Syndicate website, Sinn says that "the single currency led to the appearance of a lending bubble in Southern Europe, and when the bubble burst, the competitiveness of the region was destroyed".
     The same path will be followed by the potential new members. "Juncker's plan, to speed up the expansion of the Eurozone, threatens to recreate the chaos of the last decade, started by the bubble in Southern Europe and which climaxed with the sovereign debt crisis in Greece", is the conclusion of the German professor.
     Without a powerful domestic capital base and a legislative framework favorable to its flexible allocation between industrial sectors, in order to allow a quicker reaction to the market demands, increasing the population's income will be nothing but an illusive ideal and we will be permanently sentenced to a status of economic colony.
     The structural reforms, when looked at as the final objective and not a permanent process in which the market plays the main role, will not be enough for Romania, just like they aren't enough for the Eurozone.
     Also needed is a permissive and stable fiscal and regulatory framework, which would allow the development of a competitive and flexible private sector.
     Unless the path for structural reforms isn't opened here and now, which would provide the environment needed for accumulation and growth of domestic capital, at least by giving it equal treatment to the foreign one, then we won't stand a chance after the joining of the Eurozone, a project which is politically promoted and achieved based on ignoring economic laws and the historical experience. 
 

 
Readers' comments    [ add a comment ] 
Trimite părerea ta.
Nume (maxim 50 caractere)
E-mail (optional)
Titlu (maxim 50 caractere)
Mesaj
 
REGULAMENTUL MESAJELOR
Acord
Prin trimiterea opiniei ne confirmați că ați citit regulamentul de mai sus și că vă asumați prevederile sale !
Aceeasi sectiune (English Section)
FOR THE FIRST TIME AFTER THE LOSS OF 2.6 BILLION LEI OF 2014
THE NATIONAL BANK OF ROMANIA ISN'T COMMENTING, EVEN THOUGH BOTH COMMERCIAL BANKS ARE LISTED ON THE STOCK EXCHANGE
ACCORDING TO AN EUROPEAN COMMISSION DOCUMENT, SEEN BY BLOOMBERG
LAST WEEK, ROMANIA HAD THE BIGGEST IMPORTS OF NATURAL GAS IN THE LAST FIVE YEARS
Ediții precedente
Newsletter Facebook Twitter YouTube LinkedIn RSS
Jurnal Bursier
26.04.2018
BURSELE DIN LUME
     Bursele din Europa s-au înscris pe un curs negativ ieri, investitorii fiind mai interesați de titlurile de stat americane - datorită randamentelor - decât de acțiuni.  click să citești tot articolul
26.04.2018
BVB
     Rulajul înregistrat în ședința de ieri a Bursei de Valori București (BVB) a fost de 61,08 milioane de lei (13,14 milioane de euro), circa o treime din valoarea tranzacționată fiind realizată cu...  click să citești tot articolul
25.04.2018
BVB
     * Dragoș Mesaroș, Goldring: "Dacă BET reușește să construiască un suport în zona nivelului de 9.000 de puncte, există șanse importante ca indicele să continue să urce"
     
     Piața...  click să citești tot articolul
25.04.2018
BURSELE DIN LUME
     Bursele din Europa au fluctuat ieri, investitorii din regiune fiind atenți la rezultatele financiare anunțate de companii.  click să citești tot articolul
24.04.2018
BVB
     Bursa de Valori București (BVB) a avut parte de un debut de săptămână pozitiv din punctul de vedere al cotațiilor, toți indicii încheind ședința de tranzacționare de ieri în creștere.  click să citești tot articolul
24.04.2018
BURSELE DIN LUME
     Acțiunile de pe piețele din Europa au urmat un curs pozitiv în a doua parte a zilei de ieri, pe fondul unor date mixte privind economia regiunii.  click să citești tot articolul
Cotații Internaționale

Curs Valutar

Curs valabil din data de 25 aprilie 2018
1 Dolar australian...
1 Leva bulgărească...
1 Dolar canadian....
1 Franc elvețian...
1 Coroană cehă...
1 Coroană daneză...
1 Liră egipteană...
1 Euro...
1 Liră sterlină...
100 Forinți maghiari...
100 Yeni japonezi...
1 Leu moldovenesc...
1 Coroană norvegiană...
1 Zlot polonez...
1 Rublă rusească...
1 Coroană suedeză...
1 Liră turcească...
1 Dolar S.U.A...
1 Rand sud-african...
1 Real brazilian...
1 Renminbi chinezesc...
1 Rupie indiană...
100 Woni sud-coreeni...
1 Peso mexican...
1 Dolar neo-zeelandez...
1 Dinar sărbesc...
1 Hryvna ucraineană...
1 Dirham emirate arabe...
1 Kuna croată...
1 Bahtul thailandez...
1 Gram aur...
1 DST...
AUD
BGN
CAD
CHF
CZK
DKK
EGP
EUR
GBP
HUF
JPY
MDL
NOK
PLN
RUB
SEK
TRY
USD
ZAR
BRL
CNY
INR
KRW
MXN
NZD
RSD
UAH
AED
HRK
THB
XAU
XDR
2.8872
2.3762
2.9606
3.8777
0.1826
0.6240
0.2150
4.6474
5.3147
1.4856
3.4903
0.2308
0.4800
1.1024
0.0617
0.4459
0.9335
3.8065
0.3054
1.0960
0.6024
0.0570
0.3523
0.2012
2.7010
0.0393
0.1448
1.0364
0.6263
0.1207
162.1320
5.4996
..Lei
..Lei
..Lei
..Lei
..Lei
..Lei
..Lei
..Lei
..Lei
..Lei
..Lei
..Lei
..Lei
..Lei
..Lei
..Lei
..Lei
..Lei
..Lei
..Lei
..Lei
..Lei
..Lei
..Lei
..Lei
..Lei
..Lei
..Lei
..Lei
..Lei
..Lei
click aici pentru cursurile pieței valutare - istoric
English Section
25.04.2018
DEPUTY PRIME-MINISTER VIOREL ȘTEFAN:
     * Bogdan Chirițoiu: "The European Commission will force the future buyer of Sidex Galați to increase the output of steel"
     ArcelorMittal may only sell the Galați metallurgic plant with the explicit agreement of the Romanian state, and the European Commission will ensure that the output of the plant will increase after the transaction, deputy prime-minister Viorel Ștefan said yesterday, in a conference on the issue of major industrial energy consumers.  click here to read the entire article
20.04.2018
     * "Iliescu on trial for all the bloodshed!" was one of the powerful slogans of the University Square, as well as "Iliescu - KGB, go back to the USSR!".
     We, who had organized the marathon protest of the century, knew who Ion Iliescu was, as the rest of the Romanian people took a long time to catch on, even Brucan was wrong in his estimate that the much maligned "stupid people" would take two decades to "awake".  click here to read the entire article
16.04.2018
     * - The Syrian gas attack did not exist, the American missiles were brought down, then where are the dead coming from?!
     * - It is enough to tell Syrians that they are attacked and killing each other?
     Friday, Syria was attacked by war attacks, in which a warship of the United Nations which operate in the Red Sea (according to the American officials), American B-1 bombers, four British Royal Tornado GR4 aircraft (which fired Storm Shadow missiles) and French Rafale jets.  click here to read the entire article
12.04.2018
     New Delhi, March 4th, 2017 - I am in the garden of the Royal Plaza hotel, sitting next to the table of a group of Indians, probably Hindus, two women in colorful saris and two men, all of them in their fifties. They are checking me out, I catch them doing it a few times. A Romanian manea, with heavy Indian influences starts playing from the speakers, I am surprised, I start laughing.  click here to read the entire article
02.04.2018
FOR THE FIRST TIME AFTER THE LOSS OF 2.6 BILLION LEI OF 2014
     The Romanian Commercial Bank (BCR) has proposed to shareholders the distribution of dividends of 228.12 million lei, out of the profit of 570 million lei, for last year, this being the first year with such an item on the agenda of the General Shareholder Meeting, after the huge loss of 2014, of 2.6 billion lei, caused by the high provisions and the sale of non-performing loans.  click here to read the entire article
30.03.2018
     The website of the National Bank of Romania still includes the statement that its monetary policy strategy is the direct targeting of inflation.  click here to read the entire article
28.03.2018
     No investor has expressed interest in the privatization of the "Sanevit 2003" disposable syringes factory of Arad, as part of the last procedure initiated by the Ministry of the Economy, which took over the company in 2012 to save ut from bankruptcy, but since then, several attempts at privatization have failed, and since 2013 the plant hasn't manufactured anything, according to News.ro.  click here to read the entire article
27.03.2018
ALEXANDRU BOTEZ, ELECTRICA SHAREHOLDER:
     * The Ministry of Energy has requested the election of a new Board of Directors, even though the current management was elected in October, for a four-year term
     * The company's directors are entitled to compensation in the event of their unjustified dismissal
     * Challenges in court concerning the prior elections would remain groundless
       The proposal of the Ministry of Energy that the shareholders of Electrica (EL) decide, in the General Shareholder Meeting of April 27th, the election of the members of the Board of Directors, through the cumulative vote method, for a term of four years, even though the current directors were elected in October 2017, also for four years, has caused discontent among some shareholders.  click here to read the entire article
22.03.2018
     "The markets are turning into the markets' greatest enemy", wrote an analyst of Goldman Sachs in a note addressed to its customers, according to an article by Bloomberg, and the jump in the VIX volatility index last month "is a symptom of the financial fragility".  click here to read the entire article
19.03.2018
AS SHAREHOLDER,
     * The president of the Association of Brokers has taken the matter to the County Court of Cluj, to address the capital reduction of 2014 and the subsequent decisions of the company
     * Liviu Stoleru, CEO of Cemacon, told us on Thursday, that "no notification has been received from the company concerning such a topic"
     * The case was recorded on Friday, with the County Court of Cluj
     * BCR sold to BOF for 2 Euros the non-performing loans of 16.5 million Euros of "Cemacon" and "Ambient"
       * UPDATE 15.45 "Cemacon" confirms the lawsuit brought by Dan Paul
     "Cemacon" today sent the Bucharest Stock Exchange, a report whereby it confirms the existence of the lawsuit brought by Dan Paul, the president of the Association of Brokers. However, the officials of the company wrote that they have no details about the case.
     -------
     Dan Paul, the president of the Association of Brokers, has sued "Cemacon" (CEON), acting as shareholder, seeking the annulment of the shareholders' decision of March 24th, 2014, concerning the reduction of the share capital and of the subsequent acts, according to a notification seen by "BURSA".  click here to read the entire article
15.03.2018
THE NATIONAL BANK OF ROMANIA ISN'T COMMENTING, EVEN THOUGH BOTH COMMERCIAL BANKS ARE LISTED ON THE STOCK EXCHANGE
     The National Bank of Romania (BNR) has blocked the acquisition of Banca Românească by OTP Bank România, according to information which appeared yesterday in the Romanian press, as well as on some foreign websites. Thus, the NBR hasn't issued an opinion on the transaction, even though the time by which it should have done so expired since back in autumn last year.  click here to read the entire article
14.03.2018
RAINER SEELE, OMV:
     * OMV has a budget of 10 billion Euros for takeovers, until 2025 and it is targeting the markets in the Middle East and Asia Pacific
     * Manfred Leitner: "It is unknown how the BRUA pipeline will be implemented, but I don't think that all the gas volumes of the Black Sea that get exported will only go to the West"
       OMV wants to reduce its dependence on the European market, between 2020-2025, and will focus on acquisitions in the Middle East and Asia Pacific, according to CEO Rainer Seele.  click here to read the entire article
07.03.2018
ACCORDING TO AN EUROPEAN COMMISSION DOCUMENT, SEEN BY BLOOMBERG
     The European Union (EU) intends to apply tariffs for imports of 2.8 billion Euros (3.5 billion dollars) in the US, from T-shirts and bourbon, to motorbikes, if American president Donald Trump continues its plan to impose 25% tariffs for foreign steel acquisitions, according to Bloomberg.  click here to read the entire article
06.03.2018
     * The EU, which is preparing retaliatory tariffs of its own against the US, is carrying out talks with the countries that will be affected by the taxes proposed by the Americans: Japan, Canada, Brazil and Turkey
     * German economy minister: "President Trump wants to play a game that no one can win"
       One of the top advisors to US president Donald Trump has recently announced that the US will not make any exception from the application of tariffs set on imported steel and aluminum, even if the EU is preparing reprisals, according to ft.com.  click here to read the entire article
05.03.2018
LAST WEEK, ROMANIA HAD THE BIGGEST IMPORTS OF NATURAL GAS IN THE LAST FIVE YEARS
     * In Europe, the cold weather has led to a significant rise in the price of natural gas
       Last week, Romania imported about one third of the daily natural gas consumption to get it through the cold winter period, these being the biggest daily imports of natural gas in the last five years, according to some sources from the energy sector, quoted by Agerpres.  click here to read the entire article
.