Press Review - July 27, 2017

07.27.2017 By Oana Gavrila

Basescu Mocks Dragnea: “He's Embarrassing Himself”

PMP president Traian Basescu said Social Democratic Party president Liviu Dragnea is embarrassing himself more and more by giving orders within the party but no one pays him any heed anymore.

"Dragnea wanted to set up a national investment fund. [Former prime minister] Grindeanu said no because it was stupid and would have decapitalized state companies. Dragnea wanted to introduce a global income tax on households.

“Dragnea wanted to tax high wages more. [Prime minister] Tudose said no because the measure would have hardly brought more revenues to the state budget, as the Great Helmsman hoped,” he added.

Prime minister Tudose said Tuesday plans to introduce a solidarity tax have been scrapped. A week ago, plans to introduce a tax on turnover for companies was also scrapped. (puterea.ro)

Defense Minister Presents Army Endowment Plan

President Klaus Iohannis met Wednesday with Defense Minister Adrian Tutuianu over the army endowment plan to be presented to the Supreme Defense Council at its next meeting.

The president's office said in a statement the defense minister presented the army endowment plan for 2017-2026, which includes the allocation of 2% of GDP to the defense sector for ten years.

“We have 2% of GDP. Only part of it is earmarked for endowment,” said Tutuianu. (cotidianul.ro)

CE Hunedoara Plans To Reduce Losses by 80%

State-run energy holding CE Hunedoara estimates it will incur losses of RON169.17 million this year, 80.3% lower than last year's loss of RON858.35 million, according to the company's budget plan.

The company said losses are mainly due to the deregulation of the electricity market and its lack of competitiveness as it produces expensive coal-fired energy and competes with cheaper renewable energy.

The energy holding expects total revenues of RON664.75 million and expenses totaling RON833.9 million.

It will also shed more than 1,000 employees this year, expecting to employ 3,773 people by the end of 2017. (cotidianul.ro)

IMF To Launch New Form of Aid, With No Money

The International Monetary Fund (IMF) announced on Wednesday it will launch a new tool to support governments in financial trouble: one that involves no money, AFP reported.

Instead of providing cheap loans to countries, the new IMF tool will serve as a good housekeeping seal of approval for a government’s reform program.

With that approval in hand, governments would be more likely to be able to access other forms of financing from banks and bond markets, the IMF said in a statement.

“The new instrument is designed to help countries unlock financing from official and private donors and creditors,” the IMF said.“It enables them to signal commitment to reforms and catalyze financing from other sources.”

The IMF board this month approved the new non-financing Policy Coordination Instrument (PCI), which unlike traditional fund programs will not have any eligibility criteria, as long as the country is not delinquent in payments to the IMF.

Rather than providing loans in exchange for strict adherence to an agreed program of economic and financial reforms—with performance targets reviewed quarterly—the IMF will focus only on the government’s policy package.

But the IMF stressed that “policies supported under the instrument would be required to meet the same standard as those required under a standard IMF loan.” (evz.ro)