2007.04.16_highlight

April 16, 2007No. 15

ROMPRESPUBLICATIONS:

I. ECONOMY AT WORKRomania’s economic growth pace to slow down in 2008 andbe 4.8 percent, informs IMFRomania, target for Austrian direct investments since 2007“Romania IT” brand to be displayed in San FranciscoElectronics and home appliances market to double in next 5years

II. ROMANIAN COMPANIESPetrom to invest over 80 million euros in modernization ofPetrobrazi refinery by 2010Hidroelectrica sells 40 percent of output through direct contractsBitDefender launches first on-line multilingual forum of aRomanian brandProCA Romania estimates 50 million euros in turnover in 2007

III. TRADERomania - spot 25 in 2006 world importers top, announcesWTOIntra-community exchanges account for more than 71 pc ofRomania’s foreign tradeRomania’s trade deficit up 83 percent in first three months of2007

IV. FINANCE-BANKSRomania’s Government external debt servicing to peak at 2.36billion euros in 2008Romanians not yet interested in capital marketAvoiding infringement procedure, best solution for Romania asregards car registration tax, says Economy Minister VarujanVosganianBanks bring most foreign capital in FebruaryJust one in ten Romanians has a pension plan, says an Avivastudy

V. INDUSTRY-AGRICULTUREIncreasingly more foreign companies plan building steam powerplants in RomaniaMartifer to inaugurate biodiesel plant in Lehliu Gara

VI. EUROPEAN INTEGRATIONGovernment to turn to good account EU member status tohighest extent, says TariceanuEuropean Commission to approve Romania’s operationalprogrammes in H1 this year, says Sebastian VladescuRomania’s contribution to EU budget diminishedRomania and Bulgaria among most active supporters of “BlackSea Synergy” tabled by European Commission

VII. TOURISM AND OTHER TOPICSNational Authority for Tourism is dissolved, but tourism stays apriorityWhere Romanians spend their holidaysOver 80,000 Romanians spent Easter holidays abroad

ECONOMIC HIGHLIGHTS _______________________________________________ ROMPRES

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I. ECONOMY AT WORK

Romania’s economic growth pace to slow down in 2008 and be 4.8 percent, informs IMF

In 2007 and 2008 Romania’s economic growth pace will slow down. From a 7.7 percent realgrowth of the gross domestic product in 2006 it is to come down to a 6.5 percent growth in 2007and a 4.8 percent growth in 2008, informed the International Monetary Fund (IMF) on April 11.

In its six-month report referring to the prospects of the world economy (“World Economic Outlook”),which was published on April 11, the IMF predicts for Romania a slowdown of the economic growthpace, which is, on the other hand, associated with a diminution of inflation in 2007. Thus, the indexof the consumer prices in Romania would go down from 6.6 percent in 2006 to 4.5 percent in 2007.But next year the Fund stakes on a 5 percent inflation.

As for the current account deficit the Fund estimates a slight decrease for Romania from 10.3percent in 2006, a similar level in 2007 and to 9.8 percent in 2008.

In late February this year an IMF delegation came to Bucharest for the annual consultationswith the Romanian authorities on the Romanian economic evolution. On this occasion the expertsof the International Monetary Fund estimated that Romania would see an economic growth a littleunder 7 percent in 2007 after last year it saw a 7.7 percent growth of the gross domestic product.

Moreover, the mission of the Fund recommended Romania a budget deficit of one percent atthe most of the gross domestic product in 2007 and at the same time the orientation of the fiscalpolicies to the reduction of expenditure and the growth of the budget income. In the opinion of thehead of the mission, Emmanuel Van Der Mensbrugghe, the budget expenditure increased quicklyin the last part of last year and Romania must take steps to reduce expenditure and increaseincomes in 2007. The representative of the above-mentioned financial institution predicted forRomania a budget deficit of 3.7 percent of the GDP. On the same occasion the Fund recommendedRomania should include in the state budget one single rise in salaries in one year for the inflationtarget not to be endangered.

Romania, target for Austrian direct investments since 2007

The Romanian economy has become this year an important goal in the expansion strategies ofthe Austrian companies and investment funds, the analysts estimating that about 20 percent of thetotal projects of the Austrian and Central and Eastern European companies will be made in Romania,Adevarul daily reports on April 12.

A report conducted by Austrian Bank Oesterreichische Kontrollbank (OeKB) reveals that theactivity of the Austrian investors will intensify in the entire region, while one fifth of the investmentswill go to Romania, followed by Bulgaria, Russia and Ukraine. The four countries will draw 49percent of the total amount.

The situation of the investments and companies running on Austrian capital in March 2006indicated a capital of 8 billion euros. There are currently over 3,500 companies with Austriancapital in Romania. Austria comes second, after the Netherlands, as regards the total volume ofinvestments made in Romania. OMV (Petrom owner), Raiffeisen Bank, Raiffeisen Banca pentruLociunte, Volksbank and Porsche Bank are among the Austrian companies and financial institutionsin the Romanian market.

As many as 21 percent of the insurance market is dominated by Austrian companies such asWiener Stadtische (Unita Omniasig), Grazer Wechselseitige Versicherung (Grawe, Sara Merkur),Iniqua.

The construction material industry is represented in Romania by companies like Wienerberger,Lasselesberger, Bramac, Baumit and Tondach, while the sugar industry is dominated by AgranaGroup. (25 percent).

As regards the trade, Austria ranks 6th. Exports consist mainly of electric devices, machines,textiles, mineral products, wood, while imports are represented by products of the chemical industry,vehicles, transport equipment, food, beverages and cigarettes.


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Romania outlook revision does not change ratings on state infrastructure companies,says S&P

Standard & Poor’s Ratings Services said on April 12 that its outlook revision to stable frompositive on Romania does not affect its ratings or outlooks on the following Romanian government-controlled infrastructure companies: C.N. Transelectrica S.A.(BB+/Positive/—), CFR Marfa S.A.(B/Negative/—), CFR S.A. (BB/Negative/—), S.C. Hidroelectrica S.A. (BB-/Positive/—), and S.N.T.G.N.Transgaz S.A. Medias (BB+/Positive/—). The ratings on these companies (except CFR S.A.) are based on a bottom-upapproach and are not linked to those on the sovereign. The agency says although the rating onCFR S.A. is based on a top-down approach, the outlook does not reflect the outlook on thesovereign, due to its concern that continued weak reporting standards will increase informationrisk and may ultimately put pressure on the rating. Standard & Poor’s says it will monitor and evaluate any potential implications of the politicalenvironment underlying the sovereign outlook revision for the creditworthiness of Romanianinfrastructure companies.

One week ago, Standard &Poor’s credit rating agency downwardly adjusted its outlook onRomania from positive to stable and reaffirmed its ratings on Romania’s long-term foreign currencyloans at BBB-, outlook Stable; the ratings on short-term loans at A-3; the ratings on the long-termlocal currency loans was affirmed at BBB, ourtlook Stable, and the rating on short-term local currencyloans at A-3.

Standard and Poor’s analyst Remy Salters said the downgrade reflects the prolonged absenceof political visibility in Romania of early 2007.

Foreign businessmen’s investments in Timis County stand at about 2 billion euros

The investments of the foreign businessmen in Timis County (western Romania) stand at almost2 billion euros, with one fifth out of the 30,000 companies registered with he Trade Registry (ORC)of Timis, running on foreign capital.

The amount also includes investments in land (over 100,000 hectares) representing one fifthof the county’s arable land, being purchased by foreigners, especially Italians.

As regards the invested capital, Germany comes first with over 120 million euros.Until 2004 some three quarters of the foreign investments in the county were directed towards

Timisoara, in civil engineering, equipment and electronic devices, software industry,telecommunications and chemical industry.

Continental and Siemens VDO Automotive made the biggest investments, with the first investingsome 100 million Deutsche marks in 1999 for the opening of the factory in Timisoara and thesecond with an 8-million-euro investment.

On the other hand, Italian businessmen preferred investments in smaller companies, with lohnproduction, especially as regards the light industry, the production of footwear and textiles.

Greenfield investments have grown in Timis lately, with 18 such in vestments under way at themoment. Moreover, businessmen are more interested in creating industrial areas devoted to theproduction of car parts and IT.

Representatives of over 50 countries attend International Training Congress in Bucharest

As many as 140 trainers from 50 countries will attend, over April 16-22, the 2007 InternationalTraining Congress in Bucharest, organised by AIESEC.International Trainers aims to contribute to the development of Romanian youngsters by facilitatingthem direct contacts with an international environment and with alternative learning methods.

The Congress includes several events, such as Global Village, a range of dances, music,costumes and shows specific to participating countries.

Another event aims to contribute to the personal development of students. For half a day, theinternational trainers will concurrently deliver 15 trainings to 500 students on issues such as PersonalLeadership alongside several prominent companies.


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The name of the association AIESEC – results from a French acronym for AssociationInternationale des Etudiants en Sciences Economiques et Commerciales (International Associationof Students in Economics and Business). Today this acronym is no longer used, because theorganisation now gathers youngsters from other fields too.AIESEC is the international platform devoted to young people in which they discover and developthe potential to become the leaders due to have a positive impact in society.

Recognised by the U.N. as the biggest international organisation of young people, AIESECgathers over 20,000 members from 100 countries and territories.

In Bucharest, AIESEC has a 17-year long experience in projects devoted to students andinternational probation practice.

Only 17 percent of Romanian employers pay for employees’ training

A survey conducted by the European Foundation for the Improvement of Working and LivingConditions, published in the Gandul daily, suggests that only 17 percent of the Romanian employersare willing to pay for the training of their employees.

On the other hand, Romanian employees want to undergo professional training; therefore theyare willing to pay for courses themselves. Seven percent of the employees in Romania pay fortraining courses while the average in the EU is only 5 percent. Maltese employees seem to bemost willing to pay for training – 14 percent, and the least are the French – 1 percent and theBulgarians – 2 percent.

Finnish employers are in the lead – over 55 percent pay for training, participation in seminarsor exchange of expertise for their employees. In France, only 25 percent of employers do that andin Portugal 18 percent. Of the 2004 ten EU member states, only employers in Slovenia, Slovakia,Estonia, Poland and the Czech Republic stand above the average. Romania is towards the tail ofthe standings, followed by Bulgaria only.

“Romania IT” brand to be displayed in San Francisco

The participation of Romanian companies in the CeBIT 2007 trade fair was of good omen, asthere are all chances of their efforts paying out in contracts worth 4 million euros. Encouraged bythis success, the Romanian entrepreneurs are now looking forward to San Francisco, where theyare expected in some days’ time.

The Romanian companies having displayed in CeBIT 2007 have won export commitments worth4 million euros, State Secretary with the Romanian Ministry of Communications and InformationTechnology (MCTI) told daily Romania libera on April 11. It seems that getting their message acrossunder one single brand - “Romania IT” – was useful.

Next destination: “Investing in and Partnering with Romanian Technology Companies,” an eventto be held in San Francisco, the US, April 26-27, as part of the ITxpo trade fair organised byGartner, one of the leading IT consulting and research companies. “We want to introduce to theUS companies and business people the opportunities existing in the Romanian IT sector as well asthe latest developments in the legislation for rates and taxes, profit repatriation and intellectualproperty,” says Minister of Communications and Information Technology Zsolt Nagy.

This is a joint initiative of the Romanian-American Chamber of Commerce, the Romanian Ministryof Economy and Trade, the MCTI and the ARIES Romanian Association for the Electronics andSoftware Industry devised to offer American companies and business people the possibility ofidentifying business opportunities in Romania’s IT industry. According to MCTI officials, 18 companieshave so far announced their intention to attend the event.

ANRE to introduce means-tested electricity bill subsidies for low-income consumers

Romania’s National Energy Regulatory Authority (ANRE) will introduce on July 1 means-testedsubsidies for energy consumers on low-income that cannot afford to service their electricity bills,ANRE Chairman Nicolae Opris told a recent forum on economic development.


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“The rest of the consumers have so far supported those who could not afford to pay their bills,”Opris explained.

He said that starting on July 1, the difference between the value of a standard electricity contractand the financial means of consumers on low income would be subsidized by the Government.

The new subsidising method will take the existing social tariffs as a computation basis.

OPCOM to become regional stock exchange, in summer

The OPCOM local energy market operator of Romania will become a regional stock exchangethis summer and will no longer operate under the authority of Transelectrica, after electricity marketoperators from countries such as Greece and Bulgaria buy shares in OPCOM.

A lawyer team are drawing up a legal strategy whereby the Romanian electricity market operatorOPCOM will no longer be answerable to Transelectrica, and the document is expected to becompleted this spring.

When OPCOM becomes a regional stock exchange, Transelectrica’s shareholding will dropcontingent of how many electricity market operators are interested in joining the process, andTranselectrica will no longer keep the majority stake in OPCOM.

On the other hand, Transelectrica’s listed share package could grow by 2-3 percent, after theapproval claims of about 1,000 former property owners, abusively dispossessed during thecommunist ruling, Economy Minister Varujan Vosganian said late this March. The available sharepackage for the former owners is 5 percent, but authorities are expecting the damages to be paidout of Transelectrica securities to be less .

The 5 percent stake will be allocated out of the total 76.5 percent stake the Economy Ministrycurrently owns in Transelectrica.

After 6 months of stock exchange listing, the average price of a Transelectrica share will becomethe reference price by which the securities issued to the former owners are turned into shares.

The Proprietatea Fund holds 13.5 percent of the Transelectrica shares whereas a 10 percentpackage has been floated on the Bucharest Stock Exchange since August 29, 2006.

The privatisation of Icemenerg, Icemenerg Service and Formenerg, the three branches ofTranselectrica, will be resumed in the period immediately ahead, so that the three branches aretaken over by the investor, by end 2007,” daily Bursa reports.

BVB, RASDAQ to pool information on same website

The Bucharest Stock Exchange (BVB) will launch on April 23 a new website that will providemore information in an improved layout, BVB reports.

The updated web page of the BVB – www.bvb.ro - will comprise the information currently postedon the www.bvb.ro (which will be replaced as from April 23) and on the www.rasd.ro (which will beactive throughout May 7) concerning both the regulated market administrated by the BVB and theovert-the-counter RASDAQ stock exchange.

“The new site is an important step forward in the communication strategy of the BucharestStock Exchange. Information becomes more complex but better structured and more easilyaccessible to investors. Posting the regulated market and the RASDAQ market on the same websiteis beneficial both to investors and to the two trading platforms, which this way become more visible,”says BVB Director General Stere Farmache.

According to BVB, the data and information to be made available on the site will include thefinancial instruments in trade – details about dealings, issuers, financial results, shareholders –and global information – stock exchange indices, developments in shareholdership, dividends,global trends, statistics – and are thought to provide a comprehensive image of the entire tradebusiness conducted under the BVB systems.

The current www.bvb.ro site was launched six years ago. On March 1, 2007 the pilot version ofthe new web page of the Bourse http://pilot.bvb.ro - was launched.

In 2005, BVB turned into a joint-stock company, from a public institution, and in late 2006 itmerged with RASDAQ in view of a staged unification of the Romanian capital market. The attemptedincorporation of the Sibiu monetary and financial bourse, which was supposed to be the next stageof the process, has failed due to the lack of shareholders’ consent.


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Electronics and home appliances market to double in next 5 years

The market of electronics and home appliances in Romania will double in the next 5 years,reaching 1.8 billion euros, according to estimates made by experts in the field.

Flamingo president Jiri Rizek says that the market’s level, compared to the number of inhabitantsand the evolution from the neighbouring countries, is still very low. The relevant market amountsto about 900 million euros at present, for approximately 22 million euros dwellers. The value isvery low compared to other markets in the region such as the Czech market where at a populationalmost twice lower, the relevant market stands at some 1 billion euros, said Rizek.

Specialists deem that the average annual growth rate could stand at about 15 percent. Asignificant rise is expected on the IT&C market, a segment where the potential could reach 500million euros, in the upcoming three years, from 250 million euros at present.

Pending the materialisation of these estimates, but also the entry of big prospective internationalretailers such as Dixons or Mediamarkt, forecast to take place in 2009, local players intensified thepace of investments allotted for the opening of new stores for a better coverage of the country.

Following this trend, Flamingo’s development plans include the opening of 10 Flanco Worldstores and the consolidation of the current shop network so that by the end of 2007 the companyreach an overall selling area of 60,000 square metres, respectively 75,000 square metres by theend of next year, from 45,000 square metres at present.

On the other hand, Domo – the third relevant retailer on the Romanian market – announcedinvestments worth 6 million euros, for the opening in 207 of 17 stores in Romania. The Domo expansionis mostly related to the extension of Kaufland stores. While the number of Altex shops reached 120,the number of Media Galaxy centres, developed in big commercial centres reached 15.

Residential sector investments to boost local cement market to 600 million euros

The cement market, one of the construction sector’s most dynamic, will grow by some 15 percentby volume this year, while the prices will go up 4 to 5 percent.

The cement market may thus reach some 600 million euros, being pushed by the privatesector investments, Ziarul financiar daily reports on April 12.

The construction market posted record growth last year at 20 percent, being the most dynamicpost-1990 market. The surge in the demand for construction materials has moved the cementmarket at a fast pace, with the producers being forced to announce massive investments inproduction facilities. The upward trend seen by the construction market in 2006 kept steady in thefirst quarter of 2007 as well.

The local cement business is divided among three major players – Germany’s HeidelbergCement,France’s Lafarge and Switzerland’s Holcim, with each of them controlling about a third of themarket.

Last year, Holcim Romania managed to produce by 300,000 tonnes of cement more than in2005, so as to meet the market needs, company’s managing director Markus Wirth says.

The mild 2006/2007 winter prevented the construction works coming to a standstill, as it usuallyhappens in winter and this was one of the elements that influenced the growth of the cement sales,Lafarge Cement CEO Philippe Questiaux said. For example, the cement quantity sold by Lafargein the fourth quarter of 2006 was by 40 percent higher than in the same period of 2005, while therise was 20 percent in the first quarter of 2007.

The Romanian-based division of Lafarge Cement, the biggest player in the domestic market,sold by 30.3 percent more cement last year, while the higher prices prompted a 4 percent rise insales.

The three companies’ combined investments amounted to more than one billion euroslast year.

Overall, the cement market expanded 26 percent last year, which is double the forecast, to 7.7million tonnes; the market will keep a growing pace of 15 percent this year.


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Constructions market in Romania - 19.4 pc surge in 2006 and second place in EU

Constructions market in Romania recorded in 2006 a surge of 19.4 percent compared to theprevious year, ranking second, after Estonia, as for the constructions sector development in theEuropean Union (EU) space.

In 2007, constructions field in Romania is set to further develop, specialists estimating a growingpace of 25-27 percent, according to President of the Romanian Builders and Contractors Association(ARACO) Laurentiu Plosceanu. He appreciated that the constructions market might reach thelevel of 8.75 billion euros. Representatives of the profile associations maintain that Romania isgoing to follow an upward trend from this point of view, at least until 2009.

Constructions insurance market will be even more dynamic than the constructions sector in2007, Capital review reads in its latest issue. On one hand, the protection need of investors in realestate projects is increasing and, on the other, express demand of investors in these projectscould bring to insurers bigger than expected business.

If the constructions insurance market in 2006 was estimated at more than 11 million euros, avalue exceeding 17 million euros is expected for 2007.

At the same time, the “explosion” produced in constructions sector led to the development of adiscreet business: sale and rental of construction equipment. In 2006, the market of dealers withsuch equipment exceeded 200 million euros.

If in 2004, for instance, just 462 construction equipment units were sold on the Romanianmarket, in 2006 real estate developers would “absorb” 1,469 such pieces of equipment. From theoverall equipment sold in 2006 more than half were excavators, all imported. Given the very highprices for the construction equipment, specialists on the market say that just 20 percent of theclients are buying with cash, 60 percent appealing to leasing and the remainder preferring to rentthe equipment.

On their turn, producers of construction materials are boosting their production capacities,announcing their plans to open new units.

In 2006, the majority of producers and importers of such materials reported bigger sales ofmore than 30 percent as against 2005 and on certain segments growth even reached a level of 60percent. On the market of cement and concrete, for instance, there were jumps of some 40 percent.

For 2007 an increase in construction materials sales is estimated, of at least 20-30 percent.

Over 3,000 SMEs request financing for business development

As many as 3,066 small and medium-sized enterprises registered on April 12 with the singleelectronic register in order to access funds extended by the National Agency for Small and Medium-Sized Enterprises and Corporations (ANIMMC) for development, according to the ANIMMC website.

The average value of financing extended by ANIMMC is of 20,000 lei (about 6,000 euros), withthe non-repayable funds accounting for 80-90 percent of the value of approved projects and theremainder is co-financing provided by the company.

The agency implements 13 programmes totally worth 75 million lei (about 22 million euros), ofwhich 8 are operational in 2007.

Import of labour force from India

The crisis of labour force in the domestic construction field makes the authorities consider thepossibility of granting benefits to Romanian workers abroad, while the construction companiesresort to labour force imports from remote countries like India.

Head of the Employers’ Union of the Construction Companies Adrian Iftimie says there is animportant company in the field that signed a contract that will bring 60 Indians to work in Romania.Some 20 of them have already arrived.

According to Iftimie, the import of labour force from underprivileged countries has somedisadvantages. Among them, the “circulation of certain specific diseases, cultural problems, terrorismas well as the population’s social-psychic aspect.”


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Some companies consider moving the factories to other countries, and the export of thecompleted product to Romania. Such a company is Policolor, which is moving its factory to Bulgaria.

In 2006 the domestic market felt the lack of 50 percent of its labour force in the constructionfield, one of the reasons leading to a rise in the prices of buildings. Other factors are the highdemand on the market, the energy tariffs, competition and the crisis of the construction materials.

International exhibition Construct ExpoEntrepreneur to bring together 500 firms from19 countries

The 14th edition of the international exhibition of materials and systems for constructions,Construct Expo Entrepreneur, will bring together March 17-21, over 500 companies from 19 countries,Catalin Trifu, manager with Romexpo exhibition center told a news conference on Thursday.

“The exhibition brings together more than 500 firms, just like last year, with its component ofbuilding equipment having become a distinct exhibition, Construct Expo Equipment. The exhibitionhas sections for production and systems for constructions, interior design, site equipment, electricdevices, entrepreneurship, consultancy etc. Participating are 19 countries - Austria, Belgium,Bulgaria, Switzerland, France, Germany, Greece, Italy, Macedonia, the Netherlands, Poland, theCzech Republic, Romania, Russia, Serbia, Slovenia, Spain, Turkey and Hungary. Foreign companiesaccount for around 30 percent of the participants,” said Catalin Trifu.

In order to facilitate the visiting of the exhibition, Romexpo and the Bank for Information inConstructions, Architecture and City Planning launched an interactive guidebook, Construct ExpoEntrepreneur.

An Expo Real Estate Invest Show will take place simultaneously, organized by Romexpo and NoCash Co. The exhibition hosts group participations from Germany - Bavaria Land and HessenLand -, Greece and Serbia. The second day of the exhibition, April 18, is the Architect’s Day atConstruct Expo Entrepreneur.

As many as 300 companies from 18 countries present at international exhibitionRomtherm

The 13th edition of the international exhibition for heating, cooling and air conditioning equipmentRomtherm will gather over April 17-21 in Bucharest as many as 300 producers, importers andsellers from 18 countries, director of the organising company, exhibitions centre Romexpo inBucharest, Mariana Dicianu said on April 12.

The exhibition gathers companies from Austria Belgium, Bulgaria, Denmark, Switzerland, France,Germany, Greece, Israel, Italy, the Netherlands, Poland, Serbia, Slovakia, Slovenia, Turkey, Hungaryand Romania.

Romtherm 2007 includes heating equipment and technologies, ventilation, cooling equipmentand technologies, air conditioning, exploitation of unconventional energy sources, measuring andcontrol systems, automations, pipeline systems, heat insulation and taps.

Romania’s National Airport Corporation to become operational this May

Romania’s National Airport Corporation SA will become operational this May, following the cominginto force of a Government decision to this end published on April 12 in the Official Gazette.

The two airports operating under its authority – the Otopeni Airport and the Baneasa Airport –will be jointly managed in order to improve activities and support investment plans, but the mergerof the two airports will not trigger any rises in airport fees or air fares.

The majority stake of 80 percent in the two airports is currently held by the Romanian Governmentthrough the Ministry of Transport, Construction and Tourism and the remaining shares arecontributed toward the Proprietatea Fund.

Following Romania’s accession to the European Union on January 1, 2007, Romanian airportsare now expected to record increases of 30 percent, on the average, of the passenger transited,which makes it necessary for investment to increase their capacities.


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The Henri Coanda Airport at Otopeni has been recording rising traffic since 2000. In 2004,some 2.6 million passengers transited through this airport, while in 2005 the number advanced 15percent, to some 3 million, and the 2006 figures are expected to read 3.5 million passengers,another rise in excess of 15 percent. The airport’s management is estimating passenger traffic toreach approximately 4.5 million in 2007.

Officials of the Aurel Vlaicu Airport at Baneasa say the number of passengers using this airportshould near 1 million, which would be 30 percent more than in 2006.

Profit target of about 1.2 million euros in 2007 for Henri Coanda International Airport

The revenues and expenditure budget for 2007 provides for a gross profit of 4 million lei (1.2million euros), down by 59.75 percent as against 2006, for Henri Coanda International AirportNational Company (CN AIHCB).

The total revenues of the above-mentioned company are estimated at 253,564 million lei (over76 million euros), up by 15.92 percent as against the previous year, and the expenditure will be by19.52 higher than in 2006.

The average number of employees is estimated at 721 and the average monthly income peremployee at 2,652 lei (almost 800 euros).

CN AIHCB SA is a joint-stock company, running an entirely state capital, which is organized andworks on the basis of economic management. The financing sources are ensured by the company’sown revenues and, to complete them, by transfers from the state budget in keeping with the legalprovisions in force.

CN Henri Coanda International Airport in Bucharest mainly delivers services, carries outexploitation works, maintenance, repairs, development and modernization of the assets in itspatrimony, which it owns or has granted to some other companies, with a view to ensuring theconditions necessary for the arrival, departure and ground handling of aircraft for domestic andinternational air traffic, ensuring airport services for transit of persons, cargo and mail as well asnational public services.

Aurel Vlaicu Airport to invest 2 million euros in expanding air terminal

The Aurel Vlaicu Airport of Bucharest will invest approximately 2 million euros in 2007 in upgradingits air terminal and building shopping precincts, newly-appointed director general of the airport,Stefan Mladin, told Rompres on April 12.

“Besides an 18-million-euro investment in the upgrading of the runway, some 2 million euros willbe invested in expanding the arrival and departure terminals, building a parking lot as well assome shopping galleries and restaurants,” said Mladin.

The airport will be closed May 11 – June 29 for repairing works on the runway and all the flightswill be moved to the Henri Coanda Airport. Once the upgrading programme is over, the airport willhave nine check-in counters, from a current 4, a parking lot for 300 cars as well as shoppinggalleries and restaurants at the departure air terminal.

The development plans of the airport also includes the building of a VIP room for Romanianofficials.

“The airport might become a presidential airport and handle official flights besides cargo flights,”Mladin explained.

The expansion of the air terminals is expected to increase the capacity of the airport to 1.2-1.3million passengers a year.

“In 2006, 700,000 passengers travelled by air from the Aurel Vlaicu airport and we are expectinga rise of over 35 percent in their number in 2007. Investment was badly needed because thecapacity of the airport has been exceeded,” said Mladin.

In the first two months of 2007, approximately 210,000 passengers transited through the AurelVlaicu airport, up 30 percent from the same period of the year before. The business turnover ofthe airport is expected to go up to 9 million euros in 2007.

“We operated 15 flights on Easter, compared with 4, as operated by the Henri Coanda Airport,and we are nonetheless confident that the number of passengers will surge to 1 million, despitethe planned two-month closure,” said Mladin.


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Expressway in northern Romania estimated at 550 million euros, for a start

Authorities of Maramures County (northern Romania) put the cost of expressway linking BaiaMare- Satu Mare and Nyiregyhaza (Hungary) at some 550 million euros.

“All the studies regarding the route have been finished. The Transport Ministry is to take measuresfor the project to start. In a first stage, costs were put at around 550 million euros,” President ofMaramures County Council Marinel Kovacs said.The feasibility studies were paid by the counties of Satu Mare (north) and Maramures, from ownfunds. The expressway is to measure over 120 km and the works could start this summer.

US Tower corporation is to invest 7 million euros in apartments in Western Romania

US Tower corporation will invest over 7 million euros in a real estate project in Cluj-Napoca,according to Doru Lupeanu, marketing manager with Grup de Lux, the Romanian real estatecompany based in Cluj-Napoca to promote the River Tower project.

This would be the first project of the US company developed in Romania.The River Tower project is to include 82 1, 2 and 3-room apartments and also shopping centres

and offices on three floors.Lupeanu says that the prices set by the US developer range between 36,000 and 90,000

euros, with the amount to be paid for 1 sq m to stand at approximately 1,200 euros.The project will also include several luxury apartments, with their value to stand somewhere

around 200,000 euros. The deadline for the completion of the works is June 2008.

Spanish real estate investment in Romania to reach around two billion euros

Some 20 Spanish real estate companies are operating in Romania, and they are unfolding orplan to unfold projects worth over two billion euros.

The main Spanish players in real estate in Romania are Hercesa, Fadesa, Grupo Lar, Prasaand Riofisa. They will develop in Bucharest and some other big cities in Romania apartmentbuildings, villas and commercial centers.

Fadesa, for example, said it intends to make over one billion euros worth of investment atStefanestii de Jos, out of Bucharest, and in Bacau, eastern Romania.

Prasa has been planning to build two residential compounds in Bucharest, expected to costaround 200-250 euros.

Riofisa said it would invest for a start in Timisoara (western Romania) and Brasov (center),where it will build complexes including apartments, commercial centers and office spaces.

Hercesa is developing three residential complexes in Bucharest.The first residential compound of Spanish Grupo Lar in Romania, made up of 186 apartments,

is Natura Residence, located in Northern Bucharest.

Residential area worth 150 million euros at Nicolina Iasi

Real Estate Development Iasi (northeast of Bucharest) plans to build on the construction site ofNicolina Iasi, recently purchased, a residential complex composed by blocks of flats on a 100-150million euros investment.

“The necessary funds will be ensured by domestic private investors and banks,” Ziarul Financiardaily quoted company’s owner Eusebiu Siminiceanu as saying on April 11.

The construction works will start this autumn and will take about two years.Real Estate Development last week purchased a 4-hectare area on 6.89 million euros, on

which a section of Nicolina Iasi plant was functioning. According to the EU legislation, the companythat purchased the land cannot be forced to keep the section’s core object, Barbulescu said.

Real Estate Development Iasi was set up by end-2005 and has one employee.In order to pay the company’s debts to the state budget, the State Assets Realization Authority

(AVAS), the company’s majority shareholder, put up for sale the company’s stake.


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Aced Trading develops residential project worth 7.5 million euros

Aced Trading real estate company unfolds, in southern Bucharest, a residential project composedby 44 villas covering between 125 and 180 sqm, and construction sites ranging between 250 and450 sqm, Esop real estate consultancy company announced.

The total investment stands at 7.5 million euros.The first 20 violas are to be delivered by year-end. Among them, five units have already been

contracted, Ziarul Financiar reports. A second stage of the project, that includes 24 villas, will becompleted by the end of next year, according t company representatives.

The prices of the villas stand at 125,000-198,000 euros, with the land included.Aced Trading shareholders are Claudiu Adrian Dicu and George Morosan, holding equal stakes

of 50 percent according to data supplied by the Trade Registry.

Procter&Gamble establishes part of its acquisition division in Bucharest

The largest U.S. consumer goods producer Procter&Gamble will transfer a significant part of itsacquisition division to Romania.

More precisely, the company will conduct, from a Bucharest-based office, the requiredacquisitions for its Western European units, due to lower costs. The multinational company willhire some 200 staff in Bucharest in the next six months.

A back-up support office is currently operating in Bucharest, being the department in chargewith the purchase of the products the company needs; this office employs 45 staff, who conductoperations for Western Europe. Since the centre has proved a success, it is to be beefed up byanother 200 staff in the next six months, Human Resources Director for the Balkans withProcter&Gamble Ahmed Abdulkarim told Cotidianul daily.

“If you want to buy, for example, pencils or other such stuff for the company, the orders –technologically speaking – are made via the Internet. Thus, the employees from Romania buy forBritain from Britain-based suppliers. Actually, instead of having people who buy for us in Britain, wehave moved this acquisitions department to Bucharest”, Abdulkarim said.

The Procter&Gamble official does not rule out the possibility that, on the long term, the companymove other divisions to Romania as well.

The accession to the European Union and the unavoidable salary rises might take Romaniaout of the map of the countries where the big economic players re-locate various activities. AhmedAbdulkarim estimates that the big corporations will move to China or India in some three to fiveyears.

II. ROMANIAN COMPANIES

Petrom to invest over 80 million euros in modernization of Petrobrazi refinery by 2010

Petrom will invest approximately 80 million in the modernisation of Petrobrazi refinery, accordingto figures supplied to Rompres.

Following the modernisation, the refinery will produce Euro 5 Diesel oil with low concentration ofsulphur, according to the European Union’s environment and quality regulations.

The first component of the installation, part of the investments bound for the modernisation ofthe Petrobrazi refinery has reached the Oltenita port at the Danube river and it will be afterwardstransported to Petrobrazi.

The equipment worth about 5 million euros is 30-metre long, 4.5 metres in diameter and has aweight of 400 tonnes. This is one of the biggest transports that ever occurred in Romania and thebiggest transport in Petrom’s history.

Petrom is the biggest Romanian company of oil and natural gas, with activities in the followingfields: Exploitation and Production, Refinery and Petrochemical Products, Natural Gas, as well as


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Trade and Marketing. Petrom exploits oil and natural gas reserves estimated at one billion barrelsoil equivalent, has an annual refining capacity of 8 million tonnes and 593 fuel distribution stationsin Romania.

The company has an international network of 211 petrol stations, in the Republic of Moldova,Bulgaria and Serbia. In 2006, Petrom reported a turnover of 3.7 billion euros, and the EBITDA(Earnings Before Interest, Taxes, Depreciation and Amortization) stood at 1.02 billion euros.

Hidroelectrica sells 40 percent of output through direct contracts

The contracts signed by Hidroelectrica before the energy market became transparent and thecontracts that do not expire before January 1, 2008, account for 40 percent of its output and 10-12 percent of the total energy market, Economy and Finance Minister Varujan Vosganian said onApril 13 in Sinaia (northwest of Bucharest) within a forum on economic development issues.

‘’After January 1, 2008, Hidroelectrica will be the only energy producer to sell electricity throughcontracts signed before January 1, 2007, with the other companies allowed to sell only on OPCOMand BRM platforms,’’ he said.

Vosganian underscored that, at present, such contracts can no longer be signed and thatinfluencing the contracts is impossible.

‘’The cause of this situation was the decision to separate CONEL in producers having differentprices, some becoming more tempting than others,’’ says Vosganian.

‘’The big electricity consumers will be compelled to signed contracts for the long-run, in order tobuy enough energy to meet the consumption,’’ the Economy Minister explained.

‘’It is compulsory for Romgaz and Hidroelectrica to become very regional,’’ he underscored.‘’Romania has coal resources for another 100 years from now on and a more efficient consumption

of this resource to the detriment of the gas and fuel will decrease imports of these hydrocarbons,’’Vosganian explained.

Orange local voice traffic up 27 pct during Easter Holidays

During Easter Holidays, Romanians spoke over the Orange network 27.3 percent more than inthe similar period of the previous year, reveal data supplied by mobile phone operator OrangeRomania.

Voice traffic over the Orange net was metered for the interval April 7-9 of the current year andcompared with the previous Easter days of April 22 – 24, 2006.

According to Orange, Romanians also generously sent SMS wishes, with this traffic by some 17percent higher than in the same period of 2006.

Romanian telecoms market leader Orange closed 2006 with 8.043 million clients, up 18 percentin comparison with the previous year, posting 1.082 billion euros in revenues – a figure 24.4percent higher than that reported at end-2005.

Euroweb Romania expects EUR 2M in operational profits

Provider of communication services Euroweb Romania expects this year some 14 million eurosin revenues, for an EBITDA (earnings before interest, taxes, depreciation and amortization) of twomillion euros, said company director-general Laurentiu Stan.

In 2006, Euroweb Romania’s turnover stood at about 11 million euros, up by some 23 percentin comparison with the 8.9 million euros reported in 2005.

The company provides Internet, voice and data services as well as web hosting services.The corporate retail segment generated about 74 percent of the company’s 2006 turnover.Wholesale activities brought about 14 percent of last year’s revenues, whereas 12 percent

thereof came from the supply of alternative voice services and Internet usage to SMEs.Development plans for the immediate future envisage the entry on the residential segment with

the supply of telephone services and the network’s expansion to other regions like Brasov (centerRomania), Constanta (south-east) and Craiova (south).


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Romanian Railways eyes to transport in 2007 over 8 million passengers

The Romanian Railways (CFR) Passengers’ arm aims to transport in 2007 as many as 8 millionpassengers, according to a decision on the approval of the additional document on 2007 to thecontract of public services for the 2004-2007 period of Romanian Railways Passengers’ arm adoptedby the Executive.

Among the results of the Passenger’s arm in 2007 is the realization by the 1,778 trains – ofwhich 44 Intercity, 239 fast trains, 1,381 slow trains, 14 special trains due to total 66,315,000 kmwith the transportation of 8.13 million passengers.

The main priority programmes of development, modernization and investments of CFRpassengers’ arm for the validity period of the additional document are a programme on theequipment of trains and a programme on the equipment of electrical trains.

CFR Passengers’ arm aims to upgrade 203 locomotives for transport and to implement aprogramme for the modernization of passengers’ cars with the replacement of 20 cars and theupgrade of 89 cars.

The management of CFR Passengers also plans to introduce an automated system for ticketrelease and reservation.

The price of services subject to the additional document to the contract of public services is of878.5 million lei (about 263 million euros) plus the tariffs obtained by CFR Passengers.

The Ministry of Transport will continue to support investments for the realization of priorityprogrammes, such as the projects that ensure Romania’s integration into the system of Europeanrailway transport.

Casa Vinului Dr Pusca expands under franchise

Having two shopping centres in Bucharest, Casa Vinului Dr Pusca company will expand to thebig Romanian cities under franchise starting this year, reads daily Romania libera on April 10.

After a 25-year long experience in wine making, which he mostly acquired at the vineyard inPanciu, Vrancea County (eastern Romania), starting in 2002, oenologist Ion Pusca began tocommercialize wines coming from all Romanian wine-growing regions, but also from abroad.

On draught or bottled, white or red, dry or sweet, more than 200,000 litres of wine go to theRomanians’ glasses through the agency of Casa Vinului Dr Pusca company, the highest salesbeing registered during the most important holidays. On Easter the sales amount to over 120,000new lei and in December, during the winter holidays, they go up to more than 200,000 new lei (1euro=3.33 lei).

“To be able to trade in wines, one must respect this drink,” says Pusca, for whom this businessfirst of all relies on educating the consumers but also on promoting the produce.

Ion Pusca’s plans are also aimed at the business he had run years ago. By the end of this yearhe will be a shareholder in one of the big wine-making companies in Romania. To be able todevelop his business Ion Pusca gets informed constantly by participating annually in the internationalsessions devoted to vineyards and wines and by visiting the relevant international exhibitions.

According to Ion Pusca’s estimates, 2007 will see an increase in sales by more than 60,000liters of wine. Most consumers prefer wine on draught, whose price ranges between 5 and 8 lei.

BitDefender launches first on-line multilingual forum of a Romanian brand

BitDefender, security division of Softwin Group, has launched officially the first discussionsforum through which its products’ users from all over the world have the possibility to initiate debateson security issues, Softwin Co. announced in a press release.

On-line BitDefender forum is available in three sections, for the time being in English, Germanand Romanian and can be accessed on http://forum.bitdefender.com.


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Due to its design, this forum plans to create an international community for the Romanianbrand with the largest spread in the world (present in big stores in more than 60 countries), todevelop and to maintain an interactive communication with the targeted public, to centralize newideas or suggestions sent by users.

BitDefender forum is addressed to clients, potential clients, BitDefender partners, but it is alsogoing to approach general topics linked to the information security field. This will allow bothcommunication of solving of certain punctual requests made by the clients and communication ofdifferent security alerts and information threats circulating on the Web.

“We plan to achieve an on-line community of BitDefender fans, worldwide, who can help usbetter understand clients’ needs in the matter of information security”, said Florin Stiuca, BitDefenderViral Marketing Manager.

BitDefender is a suite of over 54 solutions focused on satisfying the security needs in thecurrent IT environment, by offering an efficient management of information threats for more than41 million individual and corporate users from some 180 countries.

Conceived in order to offer complete protection to companies’ networks and systems, BitDefendersolutions range also includes, along with antivirus protection products, antispam, antispyware,antirootkit, personal firewall, security management solutions. As well, BitDefender team offersconsultancy to organizations in the field of implementation and establishment of data securitypolicies for their intranets.

BitDefender is the data security division within the Softwin group. BitDefender has representationsabroad in Germany, Great Britain, Spain and the United States of America.

TNT Romania launches Balkan-dedicated courier service

Fast courier services provider TNT Romania launched the Balkan Express service for the directtransport of commodities or parcels from Romania to Bulgaria and Greece, Ziarul financiar reportson April 12.

The new direct link service allows “door-to-door” deliveries in two or three days at the most, toall destinations in Bulgaria and Greece.

The Romanian courier service market went up from 100 million euros in 2005 to 130 millioneuros in 2006, and the Romanian Association of Courier Operators expects a further growth by 30 –40 percent this year.

This evolution occurs on the background of the surging number of companies in the fast courierbusiness, that rocketed from about 20 in 2005 to tenfold at present. The amount of dispatchesalso increased in one year by some 20 percent, reveals data supplied by the local association ofcourier operators.

“The steep upward evolution of the Romanian market is mainly the result of intensifyingcommercial exchanges between the local market and the rest of the world,” says a TNT Romaniarepresentative.

He adds that as multinational companies develop important production capacities in the area,there is a chain of positive reactions for the local partners of these companies.

In 2006 TNT registered a turnover of over 25 million euros on the local market, up by almost 25percent in comparison with the year before. For this year the company expects the figure to riseanew by some 30 percent to an estimated 32.5 million euros.

The main player on the local market is the National Company The Romanian Post, that spent in2006 about 30 million euros for equipment and the network’s computerization; the company hasan amount twice as high earmarked for the same purpose in 2007. Of this amount, the EuropeanBank for Reconstruction and Development will disburse 50 million euros.

ProCA Romania estimates 50 million euros in turnover in 2007

ProCA Romania, a distributor of IT products and a member of RTC Holding, plans to increaseits turnover for 2007 by 40 percent, to 50 million euros, as against 36 million euros in 2006,according to the data supplied to Rompres.


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ProCA Romania has this year taken over the import and distribution to Romania of the productsmade by the Japanese brand Brother on the segment of office equipment and plans to sell onemillion euros’ worth of products.

“For the current year ProCA plans to sell one million euros’ worth of the products distributedunder this brand and for 2008 we estimate that the turnover should increase by about 25 percent,”said Sorin Stancu, managing director of ProCA Romania.

ProCA has been carrying on its activity on the Romanian market since 1995. In 2005 the above-mentioned company became a member of RTC Holding and since 2006 ProCA has been the IT&Cdistribution brand of RTC Group.

Orkla drops several margarine brands

Orkla Foods Romania has restructured its margarine range of products, after completing atakeover deal involving Royal Brinkers, one of the top three players on the domestic market in2005, according to Aliz Kosza, CEO with the company, Ziarul financiar daily writes on April 13.Orkla Foods Romania is the domestic arm of the Orkla Norwegian group, which derived a turnoverexceeding 7 billion euros

“Portfolio rationalisation started in the last quarter of 2006. Since then the Corina, Matinal andBunica brands of tub margarine have been withdrawn,” stated Aliz Kosza.

In the wake of the deal, Orkla’s portfolio on the margarine segment now includes Wiesana,Fruhstuck, Bunica (OFR’s own brands) and Linco, Holland, Matinal and Unirea (brands part ofRoyal Brinkers portfolio).

“As some of the brands are regional, they will remain in the portfolio for the time being, with aregional approach and on sales channels,” specified Kosza.

In February, Orkla re-launched the Wiesana brand of margarine, with new packaging andproduction changes. According to the company’s information, as quoted by the MEMRB, duringthe period January-February 2007 Orkla held more than a 50 percent volume of the market (notincluding private labels), with Wiesana and Unirea proving the most dynamic brands. The mainrival for Orkla on the margarine market is Unilever.

The company expects sales of Wiesana to increase by 20 pc this year, after the re-brandingprocess has been completed. According to the company’s representatives, Wiesana is the mostvaluable brand in Orkla’s margarine product range. Beside production under its own brand, thecompany also makes private label products for international retail chains, which, according toKosza, account for 1 pc of the company’s turnover.

Orkla is one of the most dynamic companies within the domestic food industry. The group hasrecently operated a capital injection of around 10 million euros in its Romanian unit. The company’srepresentatives explained the increase in capital by the need to support investments in the fivedomestic plants the company owns.

In less than three years, the domestic unit of the Norwegian group has sealed three keyacquisitions (Topway Craiova, Ardealul Covasna and Royal Brinkers Romania) reaching a total offive production platforms and employing 750 people, from 250 three years ago.

Salonta salami and sausages - a brand with tradition

Promotional campaign for Salonta, run last year by the producer, Principal Company, resuscitateda traditional brand on the cold cuts market.

At this year edition of EFFIE Gala, Salonta brand campaign has won the prize at “Food products’category (as a first, food products category was divided into two, the other half being destined tosweets) and was nominated for the grand prize, Grand EFFIE.

At the end of 2005, the producer - Principal Company - took the decision to relaunch Salontasalami and sausages brand, already present for three decades on the Romanian market. Thiscampaign is the fruit of advertising agencies Next Advertising (for media side) and CAP (for creativity).

Radu Dumitrescu, brand manager of Principal Company and officials from the two agenciesunderlined that, at the end of 2005, Salonta accounted for a market share, according to the


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volume, of just 5.61 percent, ranking fifth in a classification of market shares of dry-cured salamiand sausages producers. A study conducted in March 2006 shows that the notoriety degree ofSalonta brand was just 4 percent, compared to 53 pc for Cris-Tim, 40 pc for Campofrio or 20 pc forAldis.

Under Salonta brand, Principal Co. produces only dry-cured salami and sausages destined tosomewhat pretentious consumers.

Re-launching of this traditional brand represented a “bayonet” attack on the competitive coldcuts market. Recently, Principal Co. announced its plan to climb into the top five salami and sausagesproducers in Romania in two-years time. For this year, the announced promotional budget is ofsome 6.5 million euros.

Heineken and InBev Romania control half of Romanian beer market

About 50 percent of the Romanian beer market is controlled by two players of world repute,namely Heineken and Interbrew (InBev), either of them having a market share of 26.7 percent and21.7 percent respectively, according to a study made by the company AC Nielsen, informs Adevaruldaily on April 13.

In 2006 Interbrew posted more than 158 million euros in turnover, which is similar to whatHeineken had posted in 2005.

At the same time the Austrian producer went on growing and consolidated its first position onthe relevant market. Heineken business in Romania in 2006 amounted to more than 195 millioneuros, up by 24 percent as against 2005.

On the other hand, the main competitor, InBev Romania, made better progress in sales, whichgrew by 36 percent.

The quantity of beer commercialized on the Romanian market was on the increase, a fact that wasalso fully obvious in the balance sheets of the first two players in the field. Thus, the year 2006 was amajor positive change as regards the tendency to increase the sales of Heineken. They amounted to4.3 million hectolitres of beer, which is tantamount to a 20 percent increase as against 2005.

According to the data supplied by the company Interbrew, a part of the Belgian group InBev,sold 3.3 million hectolitres of beer in 2006.

Both companies have decided this year to change their names. Thus, Brau Union becameHeineken whereas the beer producer Interbrew Romania will be named InBev Romania.

III. TRADE

Romania - spot 25 in 2006 world importers top, announces WTO

At a value of imported goods of 51 billion dollars, equaling Iran, Romania is placed on the 25thspot in the top of the biggest importers in the world in 2006, but the intra-community exchangesare excluded from this classification, says a report published on Thursday by the World TradeOrganization (WTO).

In 2006, Romania was responsible for 0.5 percent of the imports made worldwide and the valueof exported goods saw a surge of 26 percent compared to 2005. Ahead of Romania there arecountries such as Russia, with imports of 174 billion dollars and Turkey, imports of 137 billiondollars. Below Romania there are Israel, imports of 50 billion dollars and Ukraine, imports of 45billion dollars. First spots in the top of the first 30 world importers are occupied by the United Statesof America, with a value of imports of 1,920 billion dollars, the European Union, 1,697 billion dollarsand China, 792 billion dollars.

According to statistics published by the National Institute of Statistics (INS) in March, CIF imports(including transport and insurance costs) made in 2006 by Romania amounted at 40.745 billioneuros, a surge of 25.1 percent from the previous year.

The biggest weight in Romania’s imports structure is held by the following group of products:machines and mechanical devices, machines, electrical devices and equipment, sound and images


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recording systems (24.3 percent), followed by mineral products (ores, oil, oil products, minerals,coal, cement, salt) (14.8 percent), transport means and materials (11.6 percent), steel products(9.9 percent), ready-made clothes and textiles (8.3 percent), chemical products and connectedindustries’ products (7.6 percent).

Compared to 2005, the value of imports originating from the European Union countries (EU-25)surged by 25.9 percent, accounting for 62.6 percent in the overall imports.

In the hierarchy of Romania’s partner countries as for imports, top spot is occupied by Germany(that accounts for 15.2 percent of the overall imports), followed by Italy (14.6 percent), RussianFederation (7.9 percent), France (6.5 percent), Turkey (5 percent), China (4.3 percent), Austria(3.8 percent), Hungary (3.3 percent), Kazakhstan (3.2 percent) and Poland (2.8 percent).

Intra-community exchanges account for more than 71 pc of Romania’s foreign trade

Intra-community exchanges accounted in the first two months of the year for more than 71percent of the overall Romania’s foreign trade, according to preliminary estimations of the NationalStatistics Institute (INS).

The value of intra-community exchange of goods over January 1 - February 28 stood at 10.644billion lei (3.142 billion euros) for exports and of 16.843 billion lei (4.972 billion euros) for imports,accounting for 71.9 percent of the total exports and, respectively 71.7 percent of the total imports.

In the first two months, FOB exports amounted at 14.809 billion lei (4.364 billion euros) and CIFimports stood at 23.520 billion lei (6.931 billion euros). Compared to the similar period of previousyear exports increased by 5.9 percent in lei (12.5 percent for values expressed in euros) and theimports surged by 23.7 percent in lei (31.3 percent in euros).

A more accentuated surge of imports of goods compared to exports as against the correspondingperiod in 2006 was mainly influenced by the evolution of intra-community goods exchanges,according to INS.

Intra-community deliveries of oil products recorded a drop in their quantities to almost half ofthe level recorded in January 2006 and the downward trend of active processing operations (lohn)for textile products, for intra-community deliveries, continued.

According to the preliminary medium-term Spring prognosis, 2007-2013, made by the NationalPrognosis Commission, Romania’s exports will reach 30.2 billion euros in 2007, accounting for ajump of 17 percent compared to previous year. According to CNP’s document, CIF imports willamount at 48.7 billion euros, accounting for a surge of 19.5 percent from 2006.

Of the overall exports’ value estimated for 2007, 70 percent will be represented by intra-communityexports, according to CNP. As such, Romania’s exports to EU countries will reach the amount of21.2 billion euros and the ones to extra-EU states are to slightly exceed nine billion euros. At thesame time, intra-EU imports are going to account for 63.9 percent of the overall Romania’s imports.This year, their forecasted value is of 31.12 billion euros.

Romania’s trade deficit up 83 percent in first three months of 2007

Romania’s FOB/CIF trade deficit in the first two months of 2007 stood at about 2.567 billioneuros, up 83.3 percent (plus 1.166 billion euros) against the same period of 2006, according todata released on Wednesday by the National Statistics Institute (INS).

FOB exports totaled 4.364 billion euros in the first two months of this year, their value being by12.5 percent higher as compared with the first two months of 2006 (the growth in lei was of 5.9percent). CIF imports totaled 6.931 billion euros, by 31.3 percent more than January-February2006 (23.7 percent in lei).

Trade between Romania and Italy amounts to 10 billion euros annually

One thousand new companies come annually to Romania, with the trade between the twocountries standing at 10 billion euros yearly, Italian Ambassador in Bucharest Daniele Mancini saidon April 16 in Alba Iulia, center of Romania.


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At the invitation of local authorities and Italian entrepreneurs in Alba, the Italian diplomat wenton Friday to Alba Iulia, where there is a solid Italian community. Of the 474 Italian firms in thecounty of Alba, more than half are located in the seat of the county, Alba Iulia.

At his first visit to that county now, Mancini met on April 16 with officials of the Local Council anddelivered a speech in front of the students and academics of a university in Alba Iulia. Manciniattended a ceremony during which Chairman of the Italian Chamber of Commerce for RomaniaGugliemo Frinzi was awarded a Honoris Causa doctorate degree.

In the presence of county authorities, along with Mayor Mircea Hava, Mancini symbolically cutthe ribbon for the inauguration of Allessandria Plaza, hosting Lupa Capitolina, called like that afteran Italian locality Alba Iulia is twinned with. Mancini said on the occasion that a Romanian-ItalianCultural Center will be opened a few months from now in Alba Iulia.

Real estate transactions worth 450 million euros in Q1

The value of real estate transactions on the Romania market in the first three months of thisyear is around 450 million euros, which is more than half last year’s total figure that stood at 740million euros.

The total amount was calculated taking into consideration both purchase prices mostly revealedby concerned parties and estimates from market sources.

So far, this year’s most important transaction was the acquisition of the Polus Constanta commercialfacility by the Austrian fund Immoeast, which announced it would pay Trigranit Holding 185 millioneuros, through a “forward purchase” type of contract, extending on several phases. Immoeast willpurchase this project gradually, depending on execution stages and occupancy rate.

In fact, the Austrian fund has been the most active investor this year, having been involved infour out of the ten transactions concluded this year.

Two other projects purchased by Immoeast are business parks S-Park and Victoria Park inBucharest. S-Park, built near the Press Square by Primavera Development, was purchased forapproximately 90 million euros, with a yield of 6.9 percent. For Victoria Park, built by the Belgiancompany Liebrecht & wooD near Baneasa airport, Immoeast agreed on a 60 million euro price.

Immoeast also invested 60 million euros in purchasing 25 percent of the shares in the AdamaHolding Public real estate development group, which envisages Romanian investments estimatedat 600 million euros. Adama’s shareholders are American company Tiger Global Management,private investment trust American RomRe, management and founding members.

The hotel market has also witnessed two business deals this year. Israeli company Atlas Estatestook over the Golden Tulip hotel, located on Bucharest’s Victoriei Ave., for 20 million euros, whileMetis Capital, also from Israel, purchased the Capital’s Cerna hotel, as part of its Finit Investment& Development takeover, for 2.6 million euros. A single transaction was recorded in the industrialproperties market. German transport company Transalkim sold for 3.95 million euros to the EasternEuropean Property Fund investment fund a real-estate project comprising storage and office areassituated near Bucharest.

In their latest market study, CB Richard Ellis’ analysts estimated that this year Romania willremain one of the most appealing markets in Central and Eastern Europe, both for institutions andprivate companies seeking to invest. In their opinion, the market will register an increase in numberof unfinished projects transactions, to the detriment of finalized projects, investors thus wanting toensure optimum yield to lessen the impact of continual prices increase.

The company Alia Immobiliaria, a subsidiary of Spanish group Alius, will enter the Romanianreal estate market with a nearly 35 million euro investment in a residential compound consisting of130 luxury apartments in Bucharest’s Arcul de Triumf area. The funding comes from Alius’s ownpocket and from a 26 million euro loan extended by HVB Tiriac Bank. The works began last Januaryand the project is due to be completed in March of 2009.

Biggest transaction on real estate market in 2006 - 103.5 million euros

As much as 366.5 million euros was the cumulated value of the top five transactions on the realestate market in 2006, the record being held by the takeover transaction of City Mall commercialcenter, the third mall according to size in Bucharest, in exchange of 103.5 million euros, by theAustralian investment fund APN Funds Management.


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Respective buyers were investment funds and the acquisitions in question account for morethan a third of the total transactions in 2006, Capital weekly remarks.

Austrian investment fund Europolis purchased two office buildings from Sema Park projectagainst 90 million euros. In 2006 as well, Charles de Gaulle Plaza building was bought for theamount of 80 million euros by GLL Real Estate, administrator of Accession investment fund thattook over participations previously held by Avrig 35, project’s developer, and Austrian CA Immoinvestment fund.

CA Immo also acquired for the amount of 50 million euros Bucharest Business Park officebuilding from the developer - Portland - and Millenium Business Center building was bought for 40million euros by the British real estate investment fund European Convergence Property Company.

As regards big projects, such as transactions with commercial centers, investment funds werein pole position in 2006.

As a first on Romania’s real estate market in 2006 transactions with retail spaces exceeded thevalue of office buildings acquisitions, attracting a total of some 400 million euros, whereas thetransactions’ value stood at some 210 million euros, according to a study of the real estate servicescompany DTZ Echinox.

Hypermarkets report sales of more than 50 pc during Easter

Sales of Kaufland Romania in the week ahead of Easter celebrations doubled nationwidecompared to the ones normally, this company’s Director general Gunter Grieb told Rompres Agency.

“At the level of the 23 stores opened all over the country sales jumped one hundred percent asagainst an increase of 70-80 percent recorded last year in the same period”, he underlined.

Biggest sales increases were recorded in Bucharest, Ploiesti (south), Suceava (north) and Iasi(east), according to the statement of Kaufland Romania’s Director.

As for Carrefour Romania sales, they surged by 50-60 percent on average in the same period,according to Andrea Mihai, Marketing manager of this company.

Kaufland Romania is to invest more than 100 million euros in the opening of 14 stores in thecountry and another two in Bucharest in 2007, according to estimations made by Gunter Grieb.The new stores will cover surfaces ranging between 3,000 and 5,000 square meters and a bignumber of them are expected to be launched in H1 of the year.

Four Carrefour Romania hypermarkets operate in Bucharest - Orhideea, Militari, Colentina,Baneasa. As well, the company has stores in Constanta (south-east), Ploiesti (south) and Brasov(center).

Another hypermarket, Auchan Romania, saw sales bigger by 60 percent in the week precedingEaster celebrations compared to the ones usually reported, announced Mariana Dragan,Communication manager of the company.

Number of Auchan hypermarkets’ clients surged by 40 percent in the same period.Auchan is to open four new stores in Romania in 2007 and another two in 2008, allocated

investment for each of these stores ranging between 30 and 40 million euros. They are to belaunched in Targu Mures (center), Cluj-Napoca (center), Pitesti (south) and Bucharest. In 2008two new hypermarkets are set to be opened in Timisoara (west) and in Constanta (south-east).

As of July, petrol stations to sell diesel fuel with 2 percent biofuel

As of July, the Petrom petrol stations in Romania will sell diesel fuel mixed with biofuel, Cotidianuldaily informs on April 12.

Petrom has signed a contract for biodiesel supply with Prio Biocombustibil, a company ofPortuguese group Martifer. The company will supply diesel fuel with a 2 percent content of biodiesel,as July, Petrom announced in a release.

Prio Biocombustibil will supply Petrom with a total quantity of some 20,000 tonnes. In 2008, thequantity will amount to 50,000 tonnes. The biodiesel will be mixed with diesel fuel in the two refineriesof Petrom.


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Under a Governmental Decision draft, as of July 1, 2007 all the diesel fuel sold in Romania willhave to contain at least 2 percent biofuel.

Petrom will invest some 8 million euros in the installations for mixing diesel fuel with biodiesel.The representatives of Lukoil say this company will invest some 15 million dollars in Petrotel

refinery to open a biodiesel production line.Rompetrol has announced it will build a biodiesel factory with a capacity of 60,000 tonnes per

year. Until the finalization of this project, this company is to buy, by tendering, 2,000 tonnes ofbiofuels.

Romania contributes 2 percent to Rewe Group’s sales

Companies such as Billa, Penny Market, XXL and Selgros owned by Rewe in Romania havecontributed 25 percent to the total sales of 3.84 billion euros, recorded by the group registeredEastern Europea, daily Bursa writes on April 10.

In 2006, Rewe Group sold goods worth 1.05 billion euros, by 34.7 percent more than in 2005.German Rewe Group operates in Romania through divisions such as Billa, Penny, XXL and Selgros,which own 65 stores in all.

“These are the best financial results our company has ever recorded and it represents animportant step for us,” say Rewe officials.

Rewe plans to open over 550 new stores in Europe in 2007, 300 of which will be in Germany.

Audi sales surge 85.9 percent in Q1

Audi sales in Romania soared 85.9 percent in Q1 this year vs. Q1 last year, with 595 units soldin the first three months this year compared with 320 in the year-ago period, according to marketdata, says Porsche, the importer of Audi brand in Romania.

When it comes to the models A3 and A4 Sportback, 99 cars were sold, while A4 reported 180units sold in the Sedan, Avant and Cabriolet versions.

One hundred-and-fourteen A6s were sold, the new generation of the TT sports model reported14 units sold in Q 1, and SUV Audi Q7 as many as 142.

IV. FINANCE-BANKS

Romania’s Government external debt servicing to peak at 2.36 billion euros in 2008

Romania’s Government external debt servicing will peak at 2.36 billion euros in 2008, accordingto data with the Public Finance Ministry.

The Government external debt servicing comprises loan instalments falling due, interest rates,commissions and other costs related to the credit raised by the Government. In 2006, externaldebt servicing was 1.68 billion euros.

In 2007-2011, the scheduled Government external debt servicing will range between 1.6 and2.3 billion euros. It will stand at 1.87 billion euros in 2007, at 2.36 billion in 2008, at 1.6 billion in2009, at 2.18 billion in 2010 and at 1.36 billion in 2011.

The Finance Ministry is advising prudence with the raising of external loans becoming due inless than five years, so that the accumulation of further due instalments in the following five yearsmay be avoided.

The ministry is planning to issue Euro-bonds worth at least 500 million euros in 2007.Public external debt and publicly guaranteed debt stood at 10.69 billion euros as of December

31, 2006, which was 38.6 percent of the 27.718-billion-euro medium and long-term debt.Government external debt stood at 10.28 billion euros as of end-2006, down 662.5 million

euros from end-2005, with 62.5 percent of it being made up of loans raised by the central publicadministration and 37.5 percent of Government-guaranteed external loans. As much as 47.3 percentof the external loans were raised from official creditors, including the International Monetary Fund,while 52.7 percent were raised from private creditors.


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Most of the external debt, or 60.7 percent, is made up of the single European currency. The USdollar was the currency for 29.6 percent of the debt.

The external debt was 10.4 percent of the Gross Domestic Product (GDP) and its servicing 1.8percent of the GDP. Romania’s external indebtedness is far below the 60-percent-of-the-GDPupper level allowed in the European Union.

Romanians not yet interested in capital market

Romanians seem to have not much appetite yet for the capital market, only 60-70,000 accountshave been opened by brokerage companies, while there are over 10.2 million owners of financialinstruments for the capital market, which means half of Romania’s population, say data presentedon April 12 by officials of the Central Depository.

Some 30,000 accounts have been active with the Bucharest Stock Exchange, which has madeat least one transfer in the past nine months.

“We believe part of the said 10.2 million will start feeling some attraction for the market, and thenumber of shareholders in Romania will go down, for the Central Depository to return to normalfunctioning,” said BVB director general Stere Farmache.

Avoiding infringement procedure, best solution for Romania as regards car registrationtax, says Economy Minister Varujan Vosganian

Romanian Minister of Economy and Finance (MEF) Varujan Vosganian is to make a proposal tothe government in the upcoming period to draw up a plan on the level of the first car registrationtax, with the best solution for Romania being to avoid the infringement procedure.

“Avoiding the infringement procedure is the best solution for Romania, “ the Economy Ministertold a press conference on April 10.

In his turn, the former Minister of Finance Sebastian Vladescu, who is the incumbent secretaryof state with the MEF, showed that Romania’s enforcement of the first car registration tax was aright thing to do.

The European Commission has recently sent to the authorities in Bucharest a note on the firstcar registration tax, representing the first step of the official procedure establishing Romania’sinfringement of the European Union Treaty.

The European Executive had informed the Romanian government early this year about the taxbreaking the EU provisions, as it is discriminatory, with bilateral consultations following to solve theproblem. Romania authorities brought no amendment to the tax so far.

The first car registration tax vary, depending on how old is the car, on the polluting rate and onthe engine’s power, between 160 and 8,600 euros, according to the MEF web page. A similar taxexists in others 16 EU member states.

According to statistics by the Association of Car Makers in Romania, collection of the first carregistration tax in Bucharest amounted to 9.53 million euros by March 21, 2007.

Tax on first registration of used cars to be downwardly adjusted

Romanians will pay less than initially set for the first registration of used cars imported fromother EU member countries, daily Jurnalul national reports on April 11.

Former Minister of Public Finance Sebastian Vladescu, who has been all the way a supporter of thetax, eventually changed his attitude and agreed to downwardly adjust the current value of the tax.

Moreover, the newly created Minister of Economy and Finance is expected to present to thegovernment several formulas for the car registration tax, with the Government to choose oneproposal. Vladescu also said that “the best solution” for Romania is in this case is avoiding havingthe matter brought before the European Court of Justice.

Statements on April 10, by the Finance Ministry officials came after PM Calin Popescu-Tariceanustated last week that we should not be afraid of the fact that EU intends to take a measure inRomania’s case that was taken before in the case of other European states too.


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“Avoiding the infringement procedure is the best solution for Romania,” MEF Minister VarujanVosganian said in his turn.

The first step of the procedure against Romania for infringement of the EU law was recentlymade when the European Commission sent a note to the relevant authorities in Bucharest on thefirst car registration tax issue. Moreover, the EC gave Romania two months to solve the problemrelated to the level of the tax, with the case to be sent further to the European Court of Justiceunless the problem is solved.

The European Commissioner for Taxation and Customs Kovacs Laszlo argues that, althoughlegal, the tax does not conform to EU norms in the field.

The formula used by the Romanian authorities to calculate the tax is detrimental to used carsimported from the EU and at the same time beneficial to the domestic car industry.

Vice tax brings 66 million euros to state budget in two months

The vice tax brought 66 million euros to the state budget in the first two months of 2007, whichis some 30 per cent of the revenues estimated to be obtained this year from this tax, say data sentROMPRES by Ministry of Economy and Finance (MEF).

When the tax was introduced in May 2006, the total revenues were estimated at 150 millioneuros in 2006 and 200 million euros in 2007.

In the May - December 2006 period, the revenues from the vice tax amounted to 193 millioneuros.

Following the negotiations with the EU, Romania obtained a 3-year derogation, until 2010, toreach the level of excise duty in the EU, namely 64 euros per 1,000 cigarettes.

As a result of the introduction in excise duty of the vice tax, the level of the excise duty will risemore than initial forecast to 74 euros in 2010.

Benchmark interest rate calculated for April is 8pc a year

The benchmark interest rate of the National Bank of Romania (BNR) is of 8 percent a year inApril 2007, according to Law no. 312/2004 on the BNR Statute and allowing for the macroeconomicand monetary developments, BNR informs.

The benchmark interest rate of the National bank of Romania, which has replaced the officialdiscount tax since February 2002, is calculated as an arithmetic mean, balanced by the volume oftransactions, of the interest rates on BNR attracted deposits and reverse repo-operations (thebank re-buys the certificates if the owner needs liquidity) in the months prior to that of theannouncement.

Inflation rate of 0.07 percent in March

Inflation rate stood at 0.07 percent in March 2007, with the overall prices having maintained thesame level in February, according to the National Institute of Statistics (INS).

Cumulated from the beginning of the year, the inflation rate reached 0.31 percent, with a dropover the latest 12 months (March 2006 - March 2007) to 3.66 percent.

The food prices went down by an average 0.05 percent, while the services’ prices increased by0.16 percent and the non-foodstuffs price went up by 0.13 percent.

The monthly average rate during the first quarter of the year stood at 0.1 percent vs. 0.5percent last year. The average increase in the prices stood at 5.4 percent March 2006 throughMarch 2007, as compared with the previous 12 months (March 2005 - March 2006), that is boththat calculated on the consumer price index (IPC) and that calculated on the harmonized index ofconsumer prices (IAPC), used by Eurostat for international comparisons.

Banks bring most foreign capital in February

sThe banks brought the most foreign capital in February 2007, show figures presented by theNational Office of Trade Register (ONRC).

The capital rises of over 1 million euros rose by 30% in February versus the same period of2006 to over 140 million euros, but were considerably lower versus January this year.


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According to ONRC, the main capital rises in February were in banking field, car industry andinsurance field. Thus, the Portuguese with Millennium BCP made the biggest capital injection inFebruary – almost 40 million euros.

MKB, the new shareholder of Romexterra, increased the capital by almost 22 million euros.In the car industry, DaimlerChrysler and Trelleborg Automotive increased the capital by some 8

million euros and 6 million euros.Greek insurance group EFG invested some 6,8 million euros in the two insurance companies

with which it entered the local market, EFG Eurtolife Life Insurance and EFG Eurolife GeneralInsurance.

In January 2007, the foreign capital increases exceeded 205 million euros versus some 110million euros in the same month of 2006, mainly due to the capital increase made at BCR, whichstood at 115,4 million euros. This represented half of the capital increases of over 1 million eurosin the first month of the year. However, the representatives of ONRC mentioned the capital increaseat BCR is not an actual investment, but a transfer of shares following the takeover.

Net assets of mutual funds rise to almost 200 million euros at Q1-end

Net cumulated assets of open-end investment funds rose to 663 million lei (198 million euros)at the end of the first quarter of this year, up by 4.7 percent compared to last year-end, accordingto data published by the National Union of Collective Placement Bodies (UNOPC).

Net assets appreciated by 52 percent as against the similar period of last year.If the increase of investors’ number recorded at the end of Q1 were a mere 0.1 percent compared

to previous year-end, bonds funds category would see an increase in the number of investors inthe same period by 1.4 percent and the stocks funds by 1 percent. The other fund categoriesregistered a decline in the number of their investors.

Compared to the overall investors’ number at the end of March, corporate investors accountedfor just 1.6 pc of the total number of investors and held 53 pc of the net assets of this industry, with3.5 pc less than at the end of 2006.

Start of authorisation process for compulsory private pensions

Commission Overseeing the Private Pension System (CSSPP) launched on April 10 theauthorisation of companies that will manage the private pension funds, Realitatea TV informed.

CSSPP chairman Mircea Oancea told a seminar on private pensions, that over two millionemployees aged 20 to 35 will contribute to the optional private pension funds (Pillar 3) as of May.Employees’ transfer to privately managed pension funds (Pillar 2) will begin in August and will takefour months. “Collecting Contributions to Pillar 2 will begin on Jan. 1, 2008,” Oancea explained.

Law on privately managed pension funds, reads that all employees aged up to 35 shall choosea private pension fund, where the employer will transfer 2 per cent of their gross salaries. After thelaunch of private pension funds, the contribution to public social security funds will be reducedfrom the current 9.5 to 7.5 per cent.

Employees who fail to choose a privately managed pension fund in due time will be randomlyassigned by the Commission overseeing the private pension system to one of the funds operatingin the market, within 30 days after the selection period expires.

CSSPP officials expect the total contributions to compulsory pension funds will amount toabout1,500 billion RON in 2008.

According to ‘Money Channel,’ last November, three weeks after the start of the authorisationprocess for companies to manage the private pension funds, no insurance company had submitteddocumentation to CSSPP, with the Commission only receiving one application from a financialaudit company.

Just one in ten Romanians has a pension plan, says an Aviva study

Just one in ten Romanians is holding at this moment a pension plan in comparison with a ratioof one in four East Europeans or one in two West Europeans, shows an international study ofAviva Group, European leader in the field of life insurance and pensions.


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The annual study of Aviva Group, that in 2006 included for the first time Romania as well, showsthat worldwide the population is not financially prepared to be confronted with retirement.

Six in ten adults who have only a short time till their retirement are worried that they have notsaved enough for this period and 48 percent of the pensioners in the whole world expressed thewish they made more during their active life in order to secure a peaceful retirement.

According to the study, 61 percent of the Romanians consider they should continue to workafter the pension age, to be able to maintain their living standard and 62 percent think they couldnot survive on the state pension alone, Aviva Life Insurance informs in its study.

According to Aviva experts, Eastern Europeans are the least inclined to plan their retirement. Inthe case of Romanians, the average state pension is some three-fold smaller than the net averagewage per economy.

Romanian managers earn four to five times less than Western counterparts

Romanian managers earn four to five times less than their Western counterparts, reveals astudy given recently to publicity by the Federation of European Employers (FedEE), cited byCapital weekly.

Only few are the cases of Romanian managers earning more than their West-European peers.The conception according to which wages in Romania, and especially middle and top-managementcompensations, exceed many a time those of European company leaders is misleading. The FedEEreport shows that Romania trails in the European wage ranking, holding position 41 out of 48analysed European countries and legal systems, behind states like Bosnia and Macedonia. Of the27 EU member countries, only Bulgaria is reported to have lower wages.

Although in relative terms, wages in Romania advance by 20 – 30 pct a year, the differencesagainst the most developed markets remain higher, some of them getting even deeper. Whereasa Romanian top-manager earns in average 104 lei per hour, his French counterpart earns theequivalent of 465 lei per hour, whereas his Swedish peer pockets the equivalent of 540 lei perhour.

Romanian managers might take some comfort in learning that they earn almost four times morethan the holders of similar positions in the Republic of Moldova and twice as high as Bulgarianones.

According to John Ingham, head of the FedEE statistics department, there is the risk thatRomanian wages might grow at too fast a pace, especially in the public sector. The Europeanofficial warns that the wage increase should be commensurate with productivity growth and shouldbe initiated in the private sector.

Overdue payments on small loans advances to 87 million euros

Overdue payments of individual customers on small loans increased in January 2007 for the4th consecutive time, to almost 87 million euros.

The increase in January of overdue payments of individual customers on small loans was 5.5percent, bringing the total overdue payments to RON 294.5 million (the equivalent of 86.6 millioneuros), show data with the National Bank of Romania (BNR). Included in this category are paymentsmore than 30 days overdue on loans smaller than RON 20,000 (some 5,900 euros).

This is a new historic high, being 82 percent over the figures of January 2006.BNR does not publish information about the developments in the total balance of small loans

raised by the population. The total balance of consumer loans (which includes most of the smallfunding) surged almost 92 percent January 2006- January 2007.

The number of loan customers with payments more than 30 days overdue on small loans wentup 4 percent throughout January 2007, to 288,332, still below the historic high of 291,701 as ofOctober 2006.

The number of accounts with overdue payments rose 4 percent throughout January 2007, to359,509, still below the October 2006 record high of over 360,712.


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Almost 87 percent of the overdue payments were recorded on RON-denominated loans, with anegative balance of RON 256 million (some 75 million euros). The weight of these loans advanced1 percent from January 2006.

The local currency, the leu (RON), makes up most of the consumer loans.Overdue payments on euro-denominated loans made up only 11.9 percent of the total in January

2007, slightly up from 11.2 percent in January 2006. The repayment of euro-denominated loanshas been significantly eased by the appreciation of the RON over the past years.

Overdue payments on US-dollar denominated loans were the only ones to decrease, from theequivalent of RON 3.8 million to 3.4 million, with their weight in the total also declining to a bit over1 percent in January 2007, from 2.4 percent in early 2006.

Romanian Investments and Consultancy Group to provide assistance for BCR clientswishing to access Community funds

The Romanian Commercial Bank (BCR) and the Romanian Group for Investments andConsultancy IFN (RGIC) SA have signed a cooperation agreement through which RGIC is authorizedto offer assistance to the applicants who wish to access Community funds, RGIC announced in apress release sent on April 13 to Rompres.

Romanian private companies and institutions from the public administration are beneficiaries ofthis type of assistance in order to have access to the Structural and Cohesion Funds, as well as tothe new banking products developed by BCR with the aim to access Community funds.

The Romanian Group for Investments and Consultancy IFN (RGIC) SA is certified for theimplementation and maintenance of a quality management system in line with conditions includedin SR EN ISO 9001: 2001 (ISO 9001: 2000) standard, according to RO-5093 certificate. Certificationis valid for the following activities: credit granting activities on the basis of a contract, funding ofcommercial transactions, granting of micro-credits that are not run under conditions of Law 240/2005, granting of real estate credits, consultancy in business management, financial consultancy,legal activities.

The Romanian Group for Investments and Consultancy IFN (RGIC) SA was certified by IQNet -The International Certification Network - and by the Romanian Quality Certification Body (SRAC).

CEC reports gross profit worth 24M RON in Q1 2007

The CEC Savings and Loans Bank has reported a gross profit worth 24 million lei (1 euro =3.34 RON) for Q1, 2007, by 60 percent higher than during the same interval of 2006.

Non-banking clients were given loans worth 3.5 billion lei, again 60 percent higher than in Q1 of2006 and by 425 percent more than in 2005, CEC Chairman Eugen Radulescu said on April 11.

The funds drawn by CEC were RON 7 billion, 18 percent more than in Q1 of 2006.

* * *

CEC (The Romanian Savings Bank) investments in total loans exceeded 1 billion euros at theend of Q1, 2007, CEC representatives announced on April 11.

The CEO of CEC Eugen Radulescu said that the profit target for end-2007 stands at 50 millionlei (some 14 million euros)

‘’The profit target for end-2007 is of 50 million lei and I think we are able to exceed it,’’ Radulescusaid.

He underscored that the bank’s enlargement strategy includes a foreign currency bond issueon the foreign markets.

‘’CEC will launch the first reserve draw from the foreign market in the first half of 2007 and wewill expand progressively by placing the money into loans,’’ Radulescu explained.


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OTP estimates 23 pc asset rise for Romanian branch

The Hungarians at OTP Bank have made only moderate development plans, for their Romanianbranch in 2007, after it saw its assets triple last year, Ziarul financiar daily reports on Friday.

The assets of OTP Bank Romania are expected to increase by a little over 23 percent this year,to 238.5 Hungarian forints (equivalent to some 970 million euros). Under the circumstances, theHungarians estimate that the Romanian branch will be able to slightly increase its market share to1.6 pc, against the figure of 1.5 pc last December. OTP Bank Romania (OBR) finished last yearwith assets worth 781 million euros, according to the data reported to the NBR.

However, the most important objectives on the agenda of OTP Bank Romania for this year arethe development of a private banking division, as well as the restructuring of its treasury department.

According to the documents put together by OTP Bank Hungary for next week’s general meeting,the credit portfolio of the local branch is expected to increase by 60 pc this year, to 162 billionforints (approximately 660 million euros).

OBR will concentrate on increasing deposits, which are expected to double reaching nearly 83billion forints (339 million euros).

This trend is in sharp contrast with figures seen in 2006, when the credit portfolio increased byover 300 pc, in comparison to the sums attracted from clients, which increased by a mere 62 pc.The fast growth witnessed by funding was also a result of the low starting base. OTP started retaillending operations as late as in the autumn of 2005, after having taken over one of the smallestbanks in the system, RoBank, in 2004.

Through an aggressive lending policy (which also included introducing credits in Swiss francsonto the local market for the first time), OBR managed to reach a 3.75 pc market share on thesegment of real estate credits at the end of last year.

The plans revealed by OTP Bank Hungary do not contain any references to the bank’s profitability.

Brokerage companies to release statements of accounts as of May

Brokerage companies will be able to release statements of accounts to their clients as of May,estimates Central Depository director-general Adriana Tanasoiu.

There are currently over 10.2 million holders of capital market-specific financial instruments inRomania.

The Central Depository has fully taken over the settlement-clearing operations on the BucharestStock Exchange (BVB), becoming fully operational on April 10.

The Central Depository is a joint-stock company with a share capital of three million euros and22 shareholders - BVB with 54.51 percent of the stake, banks – 8.15 percent, issuers – 17.15percent and other shareholders – 20.19 percent.

The company provides logistic support for the safe record, storage and transfer of financialinstruments, those resulted from the management and employee buy-out program included.

The Central Depository manages over 10 million accounts for about half of the Romanianpopulation, being the only company of this kind in Europe.

In the coming period, the Central Depository will increase its share capital to five million euros.

Leasing market in Romania exceeds 3.2 billion euros in 2006

Leasing market in Romania amounted at the last year-end at 3.267 billion euros, according tothe value of financed assets, accounting for a surge of 62 percent from 2005, the Association ofLeasing and Non-Banking Financial Services (ALB) and the Association of Leasing Companies inRomania (ASLR) announced in a press release.


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The biggest market share is recorded by the sector of banks’ subsidiary companies, with 75percent of the total, followed by the sector of independent companies, with 17.5 percent.

ALB and ASLR account for some 96 percent of the domestic leasing market.Contracts signed by ALB and ASLR members representing the value of financed assets was of

3.126 billion euros at the end of 2006, according to the said release.ALB financed total assets in the value of 2.284 million euros, namely 70 percent of the overall

market and ASLR financed total assets in the value of 842 million euros - 26 percent, in 2006.Total number of leasing contracts concluded by ALB and ASLR members, on December 31,

2006 was of 130,318, of which ALB concluded 82,353 and ASLR - 47,965.Corporate clients attracted the biggest part (83 percent) of the two associations’ financing,

followed by the retail component (14 percent) and the public sector (3 percent).A percentage of 75 percent of the total financing, respectively 2.354 billion euros, was focused

on transports sector, 20 percent (625 million euros) - industrial equipment and 5 percent (147million euros) - real estate sector.

As regards the transports sector, automobiles accounted for a market share of 71 percent,heavy commercial vehicles - 15 percent, light commercial vehicles - 13 percent, as well as othervehicle types - 1 percent of the total.

Financing of the real estate sector was dominated by the category of industrial and commercialbuildings, with a total of 52 percent, of class A, B and C office space - 33 percent, whereas theremainder of 15 percent represented the residential and blocks of flats sector.

From the point of view of leasing contract’s duration, the most frequently met period is of 3-4years (32 percent), followed by the one of 2-3 years (25 percent), 4-5 years (25 percent), morethan 5 years (11 percent), 1-2 years (5 percent) and of 1 year (2 percent).

In 2006, the financial leasing accounted for 98 percent of the total financed assets, the remainderof 2 percent being represented by the operational leasing.

Overall, the cross border leasing shows a downward trend year-on-year, of below 1 percent.

Major changes in life insurers’ ranking

In 2006 the top ten companies on the life insurance market underwrote gross premiums worth306 million euros, 11.6 percent more than the figure reported in 2005, Ziarul financiar daily readson April 16.

ING Asigurari de Viata and AIG Life retained the first two positions in the top ten ranking of lifeinsurers, while the other eight companies switched positions. Significant changes include Generali’sentry in the top ten, with a 103 pc increase in euros, for life insurance policies, and the exit ofInteramerican. Despite the 23 pc increase to 7.8 million euros Interamerican posted last year, itcould not outstrip the fast expansion rate of Generali, which registered underwritten gross premiumsof 11.63 million euros. A strategic move by Generali aided its entrance into the top ten ranking ofunit-linked life insurance, by the launch of Generali Investment Unit Solution.

ING Asigurari de Viata retains the leading position on the life insurance market, with grosspremiums of 123.1 million euros last year, an increase of 13.5 pc against 2005. Consecutively, INGAsigurari generated a gross income of around 12 million euros last year replacing the most profitablecompany - Allianz-Asigurari.

ING Viata is counting on the position it holds domestically, by this year relying on 15 pc higherrevenues from gross underwritten premiums, which it expects will reach 500 million RON (141million euros). Its general manager, Bram Boon, announced the company would not generate thesame income as in 2007, as this year it intended to become actively involved in the private pensionssystem.

AIG Life retained the second position through a 39.12 pc increase in gross underwritten premiumsto 39.72 million euros, as a result of diversifying its distribution and increasing the number of new


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sales in terms of number of clients. AIG Life is also considering entering the private pensionsmarket and is to make a final decision when the Romanian authorities have dealt with problemshighlighted by insurers part of the Association for Privately-managed Pensions in Romania (APAPR).In 2006 Asiban witnessed a 28.4 pc decrease in the volume of gross underwritten premiums allowingAsirom to climb from 4th position into 3rd, as its life insurance turnover increased by 13.2 pc to25.8m euros.

Grawe climbed four positions in the ranking within one year, from 9th to 5th aided by grossunderwritten premiums worth 18.3 million euros in 2006, an 87.8 pc increase against 2005.

Other insurers that moved up in the ranking last year were Allianz-Tiriac Asigurari and Aviva,currently filling the 4th and 6th positions, both climbing two positions from 2005.

Split from BCR Asigurari, the life insurance unit of BCR, posted revenues worth 14.29 millioneuros last year and plans to underwrite twice as many gross premiums this year as in 2006. Lastyear saw Omniasig Asigurari de Viata fall two positions amid a 9.6 pc decline in gross underwrittenpremiums to a total of 13.8 million euros.

Top three life insurers in 2006 were: ING Asigurari de Viata that continues to lead the market,having underwritten gross premiums worth 123.1 million euros in 2006, up 13.5 pc against 2005;

ING Viata counts on a 15 pc increase in revenues from gross underwritten premiums this year,to 141 million euros;

AIG Life retained its second position on the market last year on a 39.12 pc increase in grossunderwritten premiums reaching 39.72 million euros;

Asirom managed to move up from fourth position to third in 2006, thanks to 25.8 million eurospremiums.

Two new insurance brokers enter Romanian market

French insurance broker Aon will start this year to operate in Romania through two distinctcompanies, after Aon Denmark notified the Insurance Supervision Commission (CSA) about itsintention to sell policies directly from the country of origin following the liberalization of the insurancemarket once Romania joined the EU, Ziarul Financiar informs on April 12.

Another insurance broker that notified CSA about its intention to operate directly in Romania isUK’s Bromwall Limited.

So far, 46 insurance brokers from the intra- community space informed CSA about their intentionto conduct insurance activities in Romania.

Aon entered the Romanian market in end- 2005, after they bought insurance broker KaRo, acompany set up in 1991 by the family of the current CEO, Karina Rosu. At present, Aon is one ofthe most important local insurance brokers, with brokered premiums of 21,8 million euros in 2006,up by some 50% versus the previous year.

Aon Romania’s 2006 turnover stood at 7,5 million euros, up 37% more than in 2005.Romania has important position in Aon strategy at European level, not only due to insurance

brokerage but also due to the fact Aon wants to set up here a platform for relocating some Aonactivities from various Western European states.

Gras Savoye Romania - ten years of experience on Romanian insurance market

Gras Savoye Romania, an insurance brokerage company, celebrated on April 10 ten years ofexistence in Romania, on which occasion manager of Gras Savoye (that celebrates 100 yearssince establishment this year) Patrick Lucas paid a visit to Romania.

Gras Savoye Romania has intermediated premiums for property insurance polices worth 4.5million euros so far, with the company holding a 35 percent share on this market, said a release.

This type of insurance policy represents more than 40 percent in the total company’s portfolio,with the Gras Savoye turnover having reached 1.1 million euros in 2006.

The Gras Savoye network covers 30 countries in Europe, Africa, Middle East and Far East.


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V. INDUSTRY-AGRICULTURE

Increasingly more foreign companies plan building steam power plants in Romania

Increasingly more foreign companies have lately expressed interest in investing in electricityproduction capacities in Romania, specifically in steam power plants, daily Cotidianul writes onApril 10.

The most recent such announcement came from Austria’s Verbund, that plans to invest 250million euros in a new energy unit with an installed capacity of 400 MW, at the Iernut steam powerplant (center). Germany’s Siemens also seems interested in the same project, even if companyrepresentatives did not yet detail their intentions.

On the other hand, U.S. company AES Corporation would either seek an investment in theDoicesti steam power plant, or the capacity’s takeover, eventually along with fuel supplier PloiestiCoal Co.

The Braila steam power plant is subject to other plans regarding a partnership with the state,with Enel (Italy), Electrabel (Belgium) and E.On (Germany) having filed offers for the establishmentof a joint-venture. The three energy giants intend to contribute money and technology in theproject whereas the Romanian state will bring the land and utilities.

A similar announcement came from private energy trader Energy Holding, whose majorityshareholder - Societe Bancaire Privee Geneva - intends to build a 400 MW lignite-fired steampower plant in Oltenia, in an investment worth 700 million euros.

The Russian investors at Alro plan a 1,000 MW steam power plant that should cover their ownelectricity consumption in the first place.

Likewise, oil companies Lukoil, Petrom and Rompetrol announced they will also build suchenergy producing capacities on the platforms of the refineries under their ownership.

According to the head of the Energy Policies Department of the Economy Ministry, the localenergy market has reached a development degree high enough to allow producers to cover theircosts and collect profit from their investments.

Romania’s joining the European Union has changed the “rules of the game,” in the sense thatwhereas investors were previously asking for long-term security contracts to guarantee themprofitable energy sales, they are now bound to accept the position of the European Commissionthat is against the signing of such contracts in the energy sector.

Martifer to inaugurate biodiesel plant in Lehliu Gara

Prio Biocombustibil, a company belonging to Martifer Group will inaugurate the biodieselproduction unit in Lehliu Gara in the first half of this year, said the executive manager of MartiferGroup Carlos Martins.

With an industrial capacity of 100,000 tonnes due to be reached at the end of the first half-year,Martifer will be the first producer of biodiesel in Romania.

Martins said that in the next years, the group plans to significantly develop the activities inRomania in the field of agriculture (rapeseed and sunflower), to invest in a new unit of oil extractionand to double the biodiesel production capacity.

According to a release issued by the National Oil Company (SNP) Petrom, the company signeda contract according to which it will buy this year from Prio Biocombustibil an overall quantity ofabout 20,000 tonnes of biodiesel and in 2008 the supplied quantity is to increase to 50,000 tonnes.Thus, Petrom will sell on the Romanian market, starting July, Diesel oil with 2 percent biodiesel.The biodiesel will be mixed with Diesel oil in the two refineries of Petrom and will be supplied on tothe Romanian market, as of July 2007.

‘’Over 8 million euros are bound for investments in Arpechim and Petrobrazi, so that we couldtake over mixed biodiesel,’’ said Jeffrey Rinker, responsible for the refinery activity with the Petrom’sexecutive committee.


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Oracle Energy starts gas production in Nadlac and prepares for Cozieni

The management of Oracle Energy Canada announced that its operator for projects conductedin Romania, Carpathian Energy, got the final approval from the National Regulatory Authority inNatural Gas Sector (ANRGN) for the production of gas in Nadlac (western Romania), Bursa dailyreports on April 12.

Distrigaz Vest gas supplier inspects and tests the production equipment for starting the activity.Carpathian Energy president Alexandru Popescu told Bursa they have all the necessary

approvals for the gas exploitation in Nadlac and that the next target is the beginning, as of thisyear, of the production activity in Cozieni, near Bucharest, where several hundreds of millions ofcubic meters of gas have been traced.

Carpathian Energy currently operates four gas production facilities taken over from Petrom.The agreement between Oracle Energy and Carpathian Energy Companie Petroliera SRL,

signed in 2005, stipulates that the Canadian company can purchase up to 20 percent of shares inall seven facilities. The transaction’s price stands at 500,000 dollars.

VI. EUROPEAN INTEGRATION

Government to turn to good account EU member status to highest extent, says Tariceanu

Romania is going to meet its assumed commitments toward the European Union, Premier CalinPopescu-Tariceanu gave assurances on April 11 at the end of the first meeting of restructuredgovernment.

“We have a series of commitments assumed when concluding the negotiations and the EUaccession process - at the end of 2006 - and we will fulfil these commitments as we alreadydemonstrated we have the capacity to implement every pledge assumed by Romania in 2005 and2006 (...) First of all, I would like to tell the Romanian citizens and the European officials that theseassumed commitments we intend to meet, within the deadlines convened with the EU”, stressedTariceanu.

According to the Executive’s head, the Government’s European agenda is set to turn to goodaccount, to the highest extent, Romania’s status of the EU member country.

European Commission to approve Romania’s operational programmes in H1 this year,says Sebastian Vladescu

Romania’s Sectoral Operational Programmes are to be approved by the European Commission(EC) within the first half of this year, pointed out in a press conference former Minister of PublicFinance Sebastian Vladescu, currently State Secretary with the Ministry of Economy and Finance.

“We are holding normal technical discussions with the Commission. The operational programmesare to be adopted by EC until mid-year”, explained Vladescu.

Bucharest’s authorities have sent early this year seven operational programmes to the EuropeanCommission and this one is going to examine them in a four-month interval.

The official responsible for communication with EC’s Regional Policy Department, Charles White,explained recently that it is a frequent occurrence that the programmes are returned to the nationalauthorities because EC wishes to avoid eventual shortcomings ahead of launching the programmesand not during their implementation.

Recently, representative of EC’s Permanent Representation to Romania Giorgio Ficarelliannounced that three of the seven operational programmes conveyed by Romania to the EuropeanCommission for accessing structural and cohesion funds have been suspended for the time being.According to him, the three programmes were focused on transports, boost of economiccompetitiveness and regional development.


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Subsequently, top European officials informed that the operational programmes submitted byRomania to the European Commission were not suspended.

“Provisional suspension of these procedures may last just three days, maybe one week, doesnot mean there are major problems. It does not mean the operational programmes have beendiscontinued, but that technical, procedural elements are in question. We asked for supplementaryinformation in connection with these programmes”, explained the head of Romania Unit with theDirectorate General for Regional Policy of the European Commission (DG Regio), AnastassiosBurgas.

Romania is to benefit, over 2007-2013, of structural and cohesion funds in the value of 19.7billion euros, but according to Director general of the Managing Authority for Community SupportFramework with the Ministry of Finance, Razvan Cotovelea, Romania’s problem remains the capacityto make use of this money.

Romania’s contribution to EU budget diminished

Romania’s contribution to the European Union’s budget will be by 16 million euros smaller thepreviously set amount, the European Commission decided after the 2006 EU budget surplus worth1.848 billion euros was included in this year’s budget.

Therefore, the contribution of all the member states has been cut, by amounts calculated basedon the share they participate to the EU Gross Domestic Product.

“By the improved budget management and better planning, the contributors’ interests are betterdefended, the budget is used more efficiently, and the member states pay only what is strictlynecessary”, European Commissioner for Financial Programming and Budget Dalia Grybauskaitesaid on that occasion.

The Commission reported that in 2006 as well, the same as in the previous years, the finalbudget execution rate was high at 99 percent, and the budget surplus had kept on dropping downto the lowest level since 2000.

Romania has paid 60 million euros to EU budget this April

Romania has paid some 60 million euros to the EU budget early this April, accounting for 80percent of the contribution due for April (76 million euros), according to data supplied by theEconomy and Finance Ministry (MEF).

The amount represents revenues resulted from the VAT paid to the state budget and from thecorrection granted to Britain.

According to MEF, on April 20 the Romanian authorities will make the second payment due inApril, representing contribution from own traditional resources.

Romania has so far paid 397 million euros to the EU budget, of which 74.5 million euros inJanuary, 217.9 million euros in February and 45 million euros in March 2007. In the first threemonths of the year Romania paid 28.78 percent of the amount for the entire year.

In 2007 Romania will contribute to the EU budget some 1.1 billion euros (3.977 billion lei), theamount being calculated based on the revenues to the state budget from VAT in 2006.

EU provides Romania an amount representing 2.1 percent of the GDP (12 monthly instalmentsof 26.28 million euros), up 0.8 percent of the GDP against 2006.

Romania and Bulgaria among most active supporters of “Black Sea Synergy” tabled byEuropean Commission

The European Commission found that some member states are “highly enthusiastic” aboutstrengthening cooperation of the community forum with the Black Sea region, EuropeanCommissioner for external relations and neighborhood policies Benita Ferrero-Waldner stated inBrussels on April 11, highlighting Romania and Bulgaria in this respect.


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Both countries, that joined the EU on January 1, 2007, border the Black Sea and havesubstantially contributed to the shaping of the regional cooperation initiative called “Black SeaSynergy” launched today, the European official told a press conference dedicated to this document.At the same time, Ferrero-Waldner voiced hopes that Romania and Bulgaria will actively participatein the implementation of the new initiative.

The Commission’s idea is to complete the existing policies, to confer a higher visibility to thearea and render the current regional cooperation process more dynamic by enhanced dialoguethat should strengthen confidence among the envisaged states. Special accent will be laid oncross-border cooperation.

The essential mission of this fully transparent synergy that builds on the common interests ofthe EU and the Black Sea region, is to tighten cooperation both inside the region, and between theregion as a whole and the EU. Such actions might reach farther than the region boundaries becausemany approaches are further strongly related to the neighbouring regions, especially the CaspianSea, Central Asia and South-Eastern Europe. Black Sea cooperation should thus involve far fromnegligible inter-regional elements. It would equally take into account other regional cooperationprograms backed by international organizations or third countries, mentions the document releasedin Brussels. Following this thread, the document mentions the initiative of Romania, Austria, theEuropean Commission and the Stability Pact to strengthen the Danube region by conferring on itwell-defined political and economic dimensions.

The initiative of the European Commission sets out from the finding that the Black Sea region isa market in evolution, a turntable for energy flows, an area with interweaving transport routes,confronted however by major challenges such as frozen conflicts, illegal migration, organized crimeand environment problems. Therefore, in order to stimulate the continuation of democratic andeconomic reforms and support the region’s development and stability, the European Commissionsuggests - apart from its already existing strategy - 13 extremely varied cooperation areas: goodgovernance, security enhancement and management of the population’s movement, energy,transportation, the settlement of frozen conflicts, environment, maritime policy, fishing, trade,education, science social issues and regional development.

The synergy proposed by the Commission will be submitted to member states for approval;according to Benita Ferrero-Waldner, this might happen right during the current German presidencyof the EU that runs to end on July 1.

European Commissioner Meglena Kuneva refers to her good relationship with two formerRomanian Ministers: Anca Boagiu and Monica Macovei

European Commissioner for consumer protection Bulgarian Meglena Kuneva referred on April10 in a press release on the occasion of the recent reshuffling of the government in Bucharest tothe “fruitful relationship” he had with two of the former Romanian Ministers before the restructuring:Anca Boagiu and Monica Macovei.

Kuneva appreciated her relationship with the two ex ministers, that is the ex Justice MinisterMonica Macovei and the ex European Integration Minister Anca Boagiu, as being fruitful, alsoadding she enjoyed working with them while she was the Bulgarian Minister of European Integrationbefore January 1, 2007. I have intensively worked with the two Ministers during the tough pre-accession period, but we done it in a spirit of solidarity and not of competition, the Europeanofficial said, adding that she always appreciated this aspect during her meetings with her Romaniancounterpart back then, Anca Boagiu.

Moreover, Meglena Kuneva mentioned that she had the pleasure to welcome Monica Macoveiin Sofia last year, when the former Romanian Minister talked about her successful reform carriedout in the field of justice and about her fight against corruption. She helped us deal with importantchallenges, the European official added.

I congratulate both the two former Romanian Ministers for their results and I wish them all thebest in their future careers, the European Commissioner also said.


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Romanian authorities discuss with CE experts issues specific to IT&C

Romanian IT&C authorities have to take into account when doing their duty the recommendationsof the European Commission, according to the legal framework regarding the exchange ofinformation between the relevant parties, says a release of the National IT&C Regulatory Authority(ANRCTI).

New regulations in the field are expected in 2007 from the European Commission.An official delegation of Romanian IT authorities met on April 11 in Brussels with officials of the

Information Society and Media Directorate General. The meeting was organized by the PermanentRepresentation Office of Romania with the European Union.

On the delegation there were officials of ANRCTI the IT&C Ministry, the IT&C Inspectorate General.“Talks have targeted notably the stage of implementation of the European legislation in Romania

and issues specific to Romanian IT&C. Our main aim has been to identify policies and strategiesgood for Romania in its capacity as a EU member state. Once Romania got membership, ANRCTIhas begun to cooperate with the European Commission and national regulatory authorities in theother member states, by a notification mechanism at European level regarding the regulatorymeasures,” said ANRCTI head Dan Georgescu.

Specific topics have been discussed, such as the universal service and the digital gap, and theprojects due to solve them, the telecenters and the Economy based on Knowledge project.

The Romanian delegation presented the evolution of the IT&C sector in institutional terms, theenforcement of the acquis communautaire in the field, the current condition of the Romanianmarket. Talks have been held about the annual report for Romania drawn up as part of the i2010initiative of the European Commission, promoting an open digital and competitive economy,underlining the IT&C role as a promoter of inclusion and the improvement of the quality of life.

VII. TOURISM AND OTHER TOPICS

National Authority for Tourism is dissolved, but tourism stays a priority

With the National Authority for Tourism (ANT) having ceased activity after the recent governmentalreshuffling, tourism still remained a priority of the ministry taking over the activities in the field, thatis the Ministry of Small and Medium-Sized Enterprises, Trade, Tourism and Liberal Professions(MSMETTLP) relevant Minister Ovidiu Silaghi told Rompres on April 13.

“Tourism-related activities represent a priority of the ministry and we are to appoint soon asecretary of state for tourism,” Silaghi said.

The National Authority for Tourism was part of the Ministry of Transport, Civil Engineering andTourism, and it has recently ceased activity, as a result of an emergency ordinance of the Executivepublished on Thursday, April 12, in the Official Gazette, also stipulating that the tourism-relatedoperations are to be coordinated from now on by the Ministry of Small and Medium-Sized Enterprises,Trade, Tourism and Liberal Professions.

Romanian PM Calin Popescu-Tariceanu announced at the end of the first meeting of the newgovernment that the number of authorities and institutions answerable to the Romanian Governmentwill be reduced by half, with some of these authorities or bodies due to be dissolved or to be takenover by other ministries.

“We want a simpler and a more efficient Executive, able to rule in a more transparent manner,”the premier said. According to him, each ministry is to present a draft project on its own structuringand functioning in 14 days.

Where Romanians spend their holidays

The number of the Romanians preferring to spend their holidays abroad doubled in the lastyear from 9 percent in 2005 to about 18 percent in 2006, informs a study recently made by themarket research company IMR&C Group.


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The destinations the Romanians prefer are Italy, Greece and Spain. The same research showsthat as far back as 2005 Italy replaced Greece in the rankings of preference and the interest takenin spending one’s holidays in France or Germany decreased to a large extent. As a matter of fact,as far back as 2005, new destinations appeared on the list of the Romanians’ holidays: Hungary,Turkey, Egypt, Holland or the Czech Republic. Consequently, in 2006 Turkey and Egypt increasedin their importance for the Romanians’ holiday preferences by 1.8 percent and 1 percent respectively.

As for the domestic holiday destinations, last year 31.2 percent of the Romanians preferred theRomanian seashore, down as against 2005 (39.4 percent). The mountains come second, 19percent, with a slight increase as against the same period of the previous year (18.1 percent).Actually the mountains, which are considered more exclusive, have exceeded this status and thenumber of the people going to the mountains increased to a large extent in the past two years.

But on the other hand, the region of Moldavia (north-eastern Romania) is only visited by 3.3percent of the respondents, down as against 5.8 percent registered in 2005. Other historicalregions, such as Banat (western Romania) or Transylvania (central Romania), were also ever lessvisited in the past year.

The study was made in February 2007 by the full-service research company IMR&C Group ona national representative sample of 1,500 middle class respondents living in cities with more than70,000 inhabitants.

Over 80,000 Romanians spent Easter holidays abroad

About 176,000 Romanians crossed the country’s borders during Easter holidays, 87,000 ofthem en route to leisure destinations abroad, reports the Ministry of the Interior.

According to daily Evenimentul zilei, about 17,000 of the Romanians heading abroad left thecounty through the southeastern checkpoints of the Constanta County (Vama Veche, Negru Vodaand Ostrov).

Over 5,000 persons crossed the border to Bulgaria, standing in a 7-km long line in order to gothrough the about two-hour long customs transit procedures.

Romanian tourists said they were tempted by the friendly prices and the quality of servicesoffered in Bulgaria.

After visa waiver, spending holidays in Bulgaria has grown into a habit for the Romanians livingclose to the frontier: Constanta locals rush to the border checkpoints on important religious holidays,or just to celebrate name days or school parties, writes daily Romania libera.

Conversely, about 2,000 Bulgarians passed through the Romanian southern checkpoints for aone-day trip at the Romanian seaside.

As for the western part of the county, the Romanian border police expect the number of personswho legally cross the border to double these days. Over 10,000 travellers riding in about 8,000vehicles passed through the Cenad-Kiszombor checkpoint to Hungary.

On Easter 2006, about 160,000 Romanians crossed the border, 75,000 of them on the outbound.

Romania’s tourist areas and cultural heritage draw Austrian visitors

Over 150,000 Austrian tourists have visited Romania in 2006, lured by the unaltered, freshrural character of the villages and by the country’s cultural heritage; this visitor flow brought insome 40 million euros in revenues for tour operators.

“We have positioned Romania on the Austrian market as a cultural destination. The unalteredcharacter of Romanian villages and the people’s hospitality - highly appreciated by the Austrians- are real trumps,” says Simion Giurca, director of the Romanian tourism office in Vienna.

Giurca says the Austrians’ attitude towards Romania has steadily changed in the last two orthree years. “Today we are far closer to the Austrians’ hearts than we can imagine. As increasinglymore Austrians visit us, this familiarity will accentuate. There is a high potential we can and shouldcapitalise on,” underscored the Romanian official.

In his opinion, another element to stimulate Romania-Austria tourism exchanges is related tolow-cost air carriers entering the market.


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“I am sure that Sky Europe will this year bring to Bucharest at least an extra 5,000 Austriantourists. Under the pressure of the prices practised by Sky Europe, Austrian Airlines too mightmore often launch low-fare flights of the 99 euro type, that will result in traffic supplementation, withgains for Romanian tourism,” added the head of Romania’s Vienna-based tourism office.

Following Romania’s EU accession, inbound traffic increased: for instance, in January, Romaniareceived by 17.1 percent more Austrian visitors. In 2006, the number thereof topped 151,000.

According to daily Adevarul, this trend will carry on in 2007, when tourism promotion builds onseveral elements: Romania’s joining the EU, the declaration of Sibiu as European capital of culture,the international promotion of the Danube Delta as “landscape of the 2007-2008 tourism year.”

A brief description of the Austrian tourist reveals him as a seeker of “virgin nature, archaicvillages with unaltered folk traditions and art, hospitality, a cultural offer, functional infrastructure,tidy locations, dry wines, good cooking, and… emotional holidays.”

The regions preponderantly visited by Austrians are Moldova, Maramures, Transylvania,Dobrogea and Banat.

An Austrian tourist pays in average some 1,100 euros to spend a holiday in Romania.

Cruising US tourists in Constanta port

Over 100 US tourists on April 10 arrived on a cruise ship in Constanta port (Romanian BlackSea, south-east of Bucharest).

The river cruise ship called River Adagio, under a Swiss flag, moored at the port’s passengerterminal having on board a crew made of 40 sailors, half of them Romanians. Navlomar Agency’smanager Virgil Dragan said the American tourists went on board in Budapest a week ago and theywill stay in Constanta for two days.

“They will go sightseeing the archaeological and the historical monuments and go shopping inConstanta county. From Constanta they go on a trip to Transylvania (historical province in central-western Romania), then they will return to Bucharest and leave for the US by plane, whereas more100 holidaymakers will go on board in Constanta port, for a cruise on the Danube river to Budapest,Dragan said.

River Aria, River Odissey, River Explorer and River Rhapsody are four more ships belonging tothe same Grand Circle travel agency due in Constanta by end-November, and they will follow thesame route, Budapest - Constanta and back.

ISSN - 1221 - 8650

Romanian National News Agency ROMPRESBuletin edited by News from Romania Desk

Bucharest, Piata Presei Libere no.1, zip code 013701; Phone 207 61 17Marketing Department, Phone: 207 61 02; Phone /Fax 317 07 04

Editor-in-chief: Romeo NadasanSenior editors: Constanta Nita, Maria VoicanEnglish News Service: Bogdan Gabaroi, Dorothea Filipescu, Carmen Patac,

Corneliu Colceriu, Anca Bratu, Magdalena Tanase,Claudia Bâzdoaca, Cristi Adafini, Gabriela Tãnase,Simona Klodnischi

Editors: Stela Anchidin, Ruxandra Bratu, Daniel Cocoru, Carmen Farcasiu

Secretarial staff: Atena Timocicu-Alexe

© Romanian National News Agency ROMPRES 2005

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