- By country
- By industry
- By topic
- Top 100
SOFIA (Bulgaria), March 29 (SeeNews) - Romania's government backtracks on a controversial fiscal decree, the operator of the country's sole nuclear power plant signs a $120 million (106 million euro) maintenance deal with General Electric, while international broadcaster Central European Media Enterprises (CME) active in Bulgaria, Romania and Slovenia, is eyeing a possible sale of part or all of the company - these are some of the top stories, published by SeeNews this week.
ROMANIAN GOVT LOWERS 'GREED TAX' ON BANKS' ASSETS
Romania's government has approved cuts to the tax on banks' assets that was enforced through a controversial fiscal emergency decree in December, it said on Friday.
The government has lowered the tax on banks' financial assets to 0.2%-0.4% a year based on market share and decoupled it from money market rates, prime minister Viorica Dancila said in a televised statement at the beginning of the weekly government meeting broadcast by Digi24.
Banks with a market share below 1% would pay a tax on assets of 0.2% and banks with A market share above 1% would pay an asset tax of 0.4%, according to the amendments published on the government's website. Banks will pay the asset tax twice a year.
Originally, the decree enforced a 0.1%-0.5% quarterly tax on banks' assets if money market rates exceeded 2% - a measure severely criticized by bankers.
In certain conditions, some financial assets such as government securities, government-guaranteed lending programmes and loans to public administration bodies could be exempt from the tax.
The tax could be further lowered if banks achieve government targets that would be set annually. In order to pay less in 2019, banks would need to post 8% growth in private lending and to shrink the margin between interests rates on loans and deposits by 4 percentage points.
The government also plans to replace the Romanian Interbank Offer Rate (ROBOR), used as a reference point in calculating variable interest rates on loans to households, by a reference value to be calculated based on transaction averages.
Earlier this month, Standard & Poor's Global Ratings maintained Romania's rating at BBB-/A-3, with a stable outlook, after the Romanian government pledged it will revisit key parts of the fiscal emergency decree, especially the ones referring to the 'greed tax' on banks' assets.
However, S&P stressed it could lower the rating in the coming 12-24 months if the expected policy reversal was insufficient to avoid a pronounced economic slowdown.
"Should Romania's monetary policy flexibility weaken, for example, as a result of the new tax on the financial-sector balance sheet, downside pressure on the rating would also build," the ratings agency said.
SEE-ACTIVE CME LOOKING INTO POSSIBLE SALE OF PART OR ALL OF COMPANY
International broadcaster Central European Media Enterprises (CME), which is active in Bulgaria, Romania and Slovenia, said on Monday that it has commenced a process of exploring and evaluating potential strategic alternatives, including a possible sale of part or all of the company.
"The Board of Directors has formed a Special Committee comprising independent directors to lead the process of reviewing the various strategic alternatives available. These may include, among other things, the sale of part or all of the company, a merger with another strategic partner, a recapitalization, or continuing to execute on CME’s long-term business plan," CME said in a statement.
CME’s largest shareholder - American conglomerate AT&T, supports CME’s plan to review strategic alternatives, the broadcaster said.
"The company continues to successfully execute on its long-term plan and a simultaneous evaluation of other appropriate strategic alternatives presents a complementary path to identify the best way to maximize value for all of CME’s shareholders," John Billock, chairman of CME, said.
There can be no assurance that the exploration of any strategic alternatives will result in a transaction, the company noted, adding that no timetable has been set for the process.
CME is being advised by Allen & Company LLC and BofA Merrill Lynch as its financial advisors, and Covington & Burling LLP as its legal advisor.
CME's portfolio includes TV channels bTV, bTV Cinema, bTV Comedy, bTV Action, bTV Lady and Ring in Bulgaria, PRO TV, PRO 2, PRO X, PRO GOLD, PRO CINEMA, PRO TV International and PRO TV Chisinau in Romania, and POP TV, Kanal A, Brio, Oto and Kino in Slovenia.
ROMANIA'S NUCLEARELECTRICA, GENERAL ELECTRIC SIGN $120 MLN CONTRACT FOR NPP MAINTENANCE
Nuclearelectrica [BSE:SNN], the operator of Romania's sole nuclear power plant Cernavoda, has signed a $120 million (106 million euro) framework agreement with General Electric Global Services/GE Global Parts & Products for the maintenance of the NPP's units 1 and 2.
Based on the eight-year agreement, the two companies will provide complete maintenance and repair services for the turbine, electric generator, valves and auxiliary systems of Cernavoda's Units 1 and 2, Nuclearelectrica said in a statement on Tuesday evening.
Earlier this month, Nuclearelectrica signed a memorandum of understanding with U.S.-based NuScale Power to explore potential uses of small modular reactors (SMRs) in Romania.
The agreement aims to evaluate the development, licensing and construction of a NuScale SMR for a potential similar long-term solution in Romania, Nuclearelectrica and NuScale said at the time.
The Cernavoda plant, located in southeastern Romania, has two reactors of 700 megawatts each, which meet roughly a fifth of the country's electricity needs.
Romania's energy ministry owns a 82.49% stake in Nuclearelectrica.
General Electric Global Services is the Romanian subsidiary of U.S.-based multinational conglomerate General Electric, while GE Global Parts & Products is registered in Switzerland.
Incorporated in New York and headquartered in Boston, General Electric operates in various segments such as aviation, healthcare, power, renewable energy, digital industry, additive manufacturing, venture capital and finance, lighting, and oil and gas.
KOSOVO, ALBANA, MOLDOVA FASTEST GROWING ECONOMIES IN CESEE IN 2019-21 – WIIW
The Vienna Institute for International Economic Studies (WIIW) said on Wednesday that Albania, Kosovo and Moldova will be the fastest growing economies among 23 countries of Central, East and Southeast Europe (CESEE) in the 2019-2021 period.
The slowest economic growth in CESEE during 2019-2021 will be recorded in Russia, Belarus and Turkey, WIIW said in a press release.
The boom experienced by much of the region in 2017-2018 period is over, WIIW noted, adding that growth rates will mostly trend lower in the next two or three years.
“Weaker global growth, US protectionism, Brexit and ongoing problems in the eurozone represent a serious threat to CESEE’s export-reliant economies,” WIIW said.
WIIW projected economic growth for the group of 23 CESEE countries at 1.8% in 2019, down from 3.2% forecast in 2018.
In 2020 and 2021, the region's economic growth is seen accelerating to 2.5% and 2.7%, respectively.
“The challenges to medium- and long-term growth in CESEE are formidable,” WIIW said, adding that demographic projections indicate a collapse in population that is unprecedented outside times of war and famine.
“Authoritarianism, state capture and interference in the independence of institutions are all on the rise. Generally low educational standards, levels of network readiness and ICT capabilities (in comparison with Western Europe) could hamstring CESEE’s ability to integrate into a digitalised global economy,” WIIW said.
The Vienna Institute also said policy-makers and firms must act now to ensure that the region is not condemned to a low- or zero-growth future.