The economic situation allows the recovery of construction sector

 

The document shows that in January 2011, non-residents’ direct investments increased by 674%, up to EUR 240 million, following an increase of intra-group credits value (between the foreign investor and the resident company), to EUR 272 million. According to the NBR data on foreign direct investments in January 2011, capital participations, consolidated with the net estimated loss, amounted to EUR 32 million. Thus, FDI financed to a share of 100% the payment balance current account deficit, which totalled EUR 15 million. In its turn, this indicator (whose value dropped by 86.5% as against January 2010) mirrors the positive situation of the trade balance transformation into surplus. This therefore confirms the increased competitiveness of exporters in our country, as well as the resumption of the investment flow, which seems no longer exclusively conditioned by the seasonal factor. The FDI level directly influences the constructions market (directly depending on the foreign capital flow, available countrywide), the data announced by NBR representing good news for the sector companies. However, business plans are still defined by prudence, as the activity drop during the cold season (also mirrored in the 10.2% contraction of the construction works volume, recorded in January 2011), the growth of raw material prices and utilities price (fuel, power, etc) and the still insufficient number of important projects still represent important risk factors endangering the shy attempts at activity resumption on a large scale. However, the situation may be corroborated with the legislative projects recently launched by the Executive power and intended to encourage the economic environment. One of the main initiatives is related to the Labour Code, adopted by the Government and the Parliament as part of the procedure for undertaking responsibility. In a speech held before the joined chambers of the legislative forum, the Romanian Government Prime-minister explained the need to ratify the new Labour Code, with the fact that "changes are fair and motivated also by the world economic crisis, which has proved that we need more flexibility in this sector". According to the Prime-minister, the proposed changes will reduce the illegal work cases and increase revenues obtained from the fees collected to the state budget, following the conclusion of several labour contracts. The relevant changes also include the new amendment accepted for collective dismissals. This basically consists in the elimination of the interdiction to employ new people after collective dismissal, for nine months. In the Government amendment, within 45 calendar days, the dismissed employee has the priority right to be employed for the newly created job, without competition or trial period. "In terms of the regulations for increasing sanctions, we accepted certain proposals from the coalition partners. Employment without a medical certificate is sanctioned with a fine between RON 1,500 and RON 3,000, as the rule is very clear: a person can only be employed based on a medical certificate attesting the ability to work. Also, fines are trebled for those who use illegal work. In case there are more than five employees working without all legal documents, a criminal sanction is applied along with the total or partial loss of the employer’s right to benefit from subsidies, public or European funds", Emil Boc also pointed out. According to the data recently published by the European Statistics Bureau Eurostat, Romania ranks last within EU-27 in terms of the share of labour contracts concluded on a defined duration (with 1% of the total), this flaw being due, in rulers’ opinion, to the ambiguous provisions of the former Labour Code (valid since 2003). At the same time, it is estimated that the ratio between employees with no legal documents and workers with contracts is 1 to 4. Under these circumstances, if authorities strictly apply the new law, we should notice an increase in the number of employees officially declared with the labour inspection or, otherwise, an increase in the number of sanctions. According to a statement of the Minister of Labour and Social Protection, "with the flexibilization defining the new code, about 200,000 new jobs will be generated by the end of year". Another norm which might indirectly contribute to the elimination - at least partial - of the financial blockage and the generation of a liquidity flow in the economy consists in the emergency ordinance adopted by the Executive power, stipulating the regulation of payment staggering for a maximum of 5 years. The measure was adopted in view of supporting the business environment, as shown in a Government release. "The new norm purpose is to support companies, entrepreneurs with economic development prospects, who have orders they could carry out, but face the risk of insolvency and payment incapacity. Thus, we offer all companies the possibility to continue their activity and maintain the available jobs”, Prime-minister Emil Boc mentioned.

The Official Gazette of Romania recently published the Government Decision on distributing per project the amounts earmarked from the value-added tax to financing the program for developing the infrastructure and certain sports centres in the rural environment. The document mentions: "considering the provisions of the State budget law for 2011 no. 286/2010, on the grounds of art. 108 of the Romanian Constitution, republished, and of art. 8 par. (2) of the Government Ordinance no. 7/2006 on the creation of the program for developing the infrastructure and certain sports centres in the rural environment, adopted as amended and completed by Law no. 71/2007, as subsequently amended, we hereby approve the distribution of RON 386 million for projects from amounts earmarked from the value added tax to financing the program for developing the infrastructure and certain sports centres in the rural environment for 2011". The respective amount is used for financing the expenses necessary for carrying out the investment works provided in the financing application declared eligible, selected according to the law, based on the criteria set in the eligibility guide. This represents the second stage for distributing per project the amounts earmarked from the VAT as part of this program, most funds (RON 259.3 million) being allotted to rural infrastructure development in 39 counties countrywide, with higher amounts in Covasna (RON 10.01 million), Dâmbovita (RON 10.76 million), Galati (RON 10.2 million), Maramures (RON 10.03 million), Mures (RON 16.47 million) and Suceava (RON 12.62 million). For gyms in rural areas, the central authorities provided the local authorities with RON 126.69 million, distributed to many localities from 41 counties countrywide.