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THE WEEK IN REVIEW (25/02-02/03.2008)
(2008-02-29)
Last updated: 2008-02-29 15:29 EET


Romania has 4 months left to recover 27 million Euros, following the privatisation of the Automobile Craiova car factory, in southern Romania, after the European Commission came to the conclusion the amount of money granted by Bucharest to the car manufacturer represented illegal state aid. The sum to be recovered represents the difference between the market price of the Romanian factory, estimated at some 84 million Euros, and the price paid by the US car manufacturer Ford to take over the factory, that is some 57 million. Prime Minister Calin Popescu Tariceanu has said he is unpleasantly surprised by the European Commission’s decision, but he would not contest it, out of his wish to see the privatisation process completed.

”When there is much talk across Europe regarding economic growth and job-creation, after a condition has been implemented to maintain jobs and ensure a production profile or volume, they consider competition is distorted. What does the Commission want Romania to do? It wants us to produce buttons or something of the kind, while other countries to build planes and cars. Or maybe, it wants us to be exporters of traditional woodwork.”


Ford has however made public its decision not to change its plans related to the Craiova-based factory and expressed readiness to take over the plant and turn it into a production line meeting international standards. The privatisation of Automobile Craiova is not the only one of its kind in Romania to have attracted the attention of the European Commission. The EU specialists are also looking at the investments made in the Nokia plant near Cluj, Tractorul Brasov, Mittal Steel Roman and Antibiotice Iasi. A week ago, the European Commission sent a warning letter to the Romanian government, announcing the cabinet it might start an inquiry into the privatisation of the “Antibiotice” medicine factory in Iasi, if the buyer receives state aid without a clear mention of this fact, and without the imposition of obligations such as maintaining the domain of activity and social clauses. The Authority for the Recovery of State Assets has announced it will revoke the privatisation offer for the Iasi-based factory, after the government decided to cancel the bid, given the economic and social importance of the medicine producer.


More than 40,000 public servants working in town and city halls, county councils and tax collecting departments went on a two hour strike on Thursday, threatening to call an all out strike, if their claims are not met. They are mainly discontent about the level of salaries and the distribution of meal tickets. The Federation of Trade Unions in the Local Public Administration says it has followed all necessary procedures to meet labour minister, Paul Pacuraru, accusing him of using discriminatory criteria when choosing his dialogue and negotiation partners.


The National Bank of Romania will use all instruments at its disposal to curb inflation, says the governor of the central bank, Mugur Isarescu. According to him, if the bank fails to contain this indicator within the envisaged limits, Romania’s goal to switch to the Euro around 2014 might be postponed for 2 or 3 years. However, Isarescu says an economic recession in Romania is out of the question, given that the country enjoys an economic growth rate of around 6%. As an anti-inflationary measure, the minister of economy and finance, Varujan Vosganian, has announced he will submit to the prime minister a budgetary revision proposal which provides for a 1.1 billion Euro spending reduction, without however cutting the sums of money destined for investment.


President Traian Basescu has made a new attempt to secure the support of the parliamentary parties for the Pact for Education. The signing of the document, which is based on an analysis made by a presidential commission, is instrumental, to make sure that the National Plan in the field will be observed, irrespective of the parties which come to power. The plan stipulates, among other things, that education and research should received 6% and 1% o the GDP, respectively, for the 2008-2013 period. The parliamentary parties which participated in the consultations initiated by the Romanian president, that is all parliamentary parties with the exception of the (populist) Greater Romania Party (in opposition), which declined the invitation, agreed to drafting a long term coherent strategy, aimed at modernising and enhancing the efficiency of the educational system. They now have one week at their disposal to make amendments.


The Italian government has approved a new decree on the expulsion of EU citizens who commit crimes in Italy. The decree, which has the status of law, establishes the way in which European citizens who jeopardise public safety can be expelled from Italy. Based on EU norms, the new decree stipulates that EU citizens should announce their presence in Italy and to produce a proof of their source of income in Italy. Also, residency applicants who have committed severe crimes can be denied the right to establish their residency in Italy. This is the third decree on expulsions to have been issued in Rome, which decided to take special measures after in October 2007, an Italian woman died after having been assaulted by an ethnic Roma holding Romanian citizenship.
(Corina Cristea)
 
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