Financial Press Review, November 5

All the front pages comment yesterday’s statements of the NBR governor, made when he presented this year’s third quarterly Report on Inflation.

"Isărescu: The country will recover after public sector lay-offs," reads Ziarul Financiar.

"The governor pointed out that the economy will start to grow again substantially once the public sector is trimmed, fact that has already started to be done through lay-offs and salary cuts.

He also reiterated his criticism towards those that are asking that the Central Bank loosen the monetary policy, in order to adjust the economy," the afore mentioned daily also reads.

With the title "We risk being excluded from the EU," Curierul Naţional also quotes from the NBR governor yesterday’s statements the idea that "Romania will have to make efforts to trim where necessary, and not through the backdoor of inflation."

"Romania has to stop deluding itself that its problems can be solved through inflation." Economic growth is dependent on structural reforms that would lead to productivity increase, the newspaper emphasizes.

Mugur Isărescu also mentioned that economic recovery will have an impact on the citizens’ wallets "one or two years after the growth is resumed," Economistul reads in turn.

It also mentions another idea from the governor’s statement that "they jumped from one abuse to another in the text of Ordinance 50," especially regarding control over bank activities and brokerage costs.

In an article, Bursa refers to President’s Traian Băsescu intervention on our radio station.

Among other things, the Head of State announced that 'in order to pay public sector salaries and pensions, our country will have to borrow money for another many years,' reads Bursa.

The president also announced that, in a letter of intent, the Government is requesting a stand-by arrangement until April 2011 from the IMF and the European Commission, on state debts to private companies. (…) Băsescu accounted for Romania’s request by the fact that the government hasn’t managed to carry out quickly enough the restructuring of the state machine and of the social services system.

With the title "Romania, world runner-up at tax payments by companies, Ziarul Financiar prints an article which reads: 'Taxes seem to be our country’s greatest burden in the business environment."

Although Romania only has 17 taxes, companies have to make 113 annual payments, because some taxes are paid monthly or quarterly, the daily explains.

As a consequence, "a Romanian company wastes 222 hours annually in order to pay the 113 taxes, and the global tax rate is 44.9%. To compare, in Sweden companies only pay taxes twice a year, and in Hong Kong, three times."

Translated by: Gabi Lungu and Elena Daniela Radu

MA Students, MTTLC, Bucharest University