English Section

30 octombrie 2008

Romania Uses Only 14% Of Agricultural Land, Food Prices Set To Grow

The autumn sowing works are almost completed and the optimum period for sowing most of the agricultural plants is over. However, the balance for this season is rather grim. Of the 9.4 million hectares of arable land in Romania, only 1.5 million hectares have been sown this autumn, which is 1 million hectares less than a year ago. On top of everything, the governmental support for the autumn sowing works came very late, while the price for seeds, fertilizers and fuel have increased substantially. Next year"s crop therefore is likely to be rather feeble. According to Viorel Matei, president of the National Federation of Agricultural Producers in Romania (FNPAR), only 20% of the necessary amount of chemical fertilizers has been used. According to FNPAR statistics, not one forecast surface has actually been sown. Bad weather, insufficient financing and an incoherent agricultural strategy are among the explanations for quite a worrisome status: wheat - 1,140,000 hectares sown (55% of the forecast), autumn barley - 140,000 hectares (85% of the forecast), two-row barley - 70,000 hectares (73% of the forecast). Rapeseed is an even sadder story because 380,000 hectares (85% of the forecast) were sown, but approximately half of them need to be re-sown because of the drought. Romania has only sown 5,000 hectares of fodder plants (20% of the forecast) and 800 hectares of vegetables (17% of the forecast).

Aegon Receives 3 Bln EUR From Dutch Government

Dutch insurer Aegon NV has received a 3 billion EUR (3.8 billion USD) from the Dutch Government to cope with the ongoing financial crisis. The agreement in this respect was concluded between the Dutch Finance Ministry, Aegon and the Dutch Central Bank. Aegon will consequently issue 750 million shares without voting rights for a price of 4 EUR each to their leading shareholder, the Vereniging Aegon Foundation. A year after the issuance, Aegon will be able to buy back the special shares for 150% of the face value or 6 EUR/share. Following the capital injection, Aegon is now the second major Dutch financial player to receive governmental support after ING Groep NV. Early this month, the Dutch Government announced they would make 20 billionEUR available to the financial sector, but only to entities regarded as healthy and viable.

Dealers: "Interbank Interest Rates Do Not Reflect Market Status"

The interest rates on the monetary market remain around 14% bid and 18% offered for one-day loans, dealers inform. In both cases, the rates are above the National Bank"s key interest rate of 10.25% as the demand for liquidity remains quite high.Dealers believe that the interbank rates on display do not reflect the situation on the market as banks remain startled by the National Bank"s approach. Specifically, the central bank demanded explanations from the banks with very high rates (over 90% for one-day arrangements), despite their option to obtain liquidity from the central bank through Lombard credit with an interest of 14.25% in exchange for Treasury bills.

KBC Group To Receive 3.5 Bln EUR Capital Injection

The Belgian State will inject 3.5 billion EUR (4.3 billion USD) in KBC Group NV, the country"s biggest bank and insurance company, in a bid to support the group, whose shares have been plunging for weeks.KBC announced they would issue preference shares worth 3.5 billion EUR to the Belgian State, following the example of other banks in the world. The operation will not affect the holdings of existing shareholders and will not give the Belgian State any voting rights. However, the Belgian State will appoint two representatives to the KBC Board.

ARB: Denigrating A Bank Could Become A Crime

The Romanian Banking Association (ARB) wants the act of denigrating a bank to become a crime, according to representatives of the ARB Board. National Bank Governor Mugur Isarescu and Justice Minister Catalin Predoiu are supporting this initiative, according to ARB President Radu Gratian Ghetea. He added that the matter would soon be discussed with the minister of Interior, too. "To denigrate a bank is more serious than to denigrate a pretzel factory, because banks are much more vulnerable to rumors," Ghetea told a press conference after the ARB meeting.

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