26 letters of interest have been received for the privatization
of the three power holdings, planned to include mining units
and electricity generators, according to Rompres. Among the main
bidders are Bechtel and AES, Enel, IFC, EBRD and the Public
Power Corporation of Greece - most of them placing letters for
all holdings. The establishment of the energy holdings has been
accelerated by the government late last year, after having been
considered for a couple of years. The investors have been
invited to express their interest in late December, after a
similar call has been launched in early 2003. The project is
however in its early stage. The economy ministry will inform the
potential investors on future steps. ISI
Viromet, Romgaz and Transgaz companies plan to set up a joint
stock company dealing mainly in turning to account poor
natural gas, containing a large quantity of carbon dioxide, to
manufacture new products such as glycerin and bio-diesel fuel,
daily Bursa reports on Wednesday. Romgaz and Transgaz are
planned to be the new company's main shareholders and they would
have to ensure drilling and transport of carbon dioxide-rich
gas, while Viromet is expected to ensure processing. This kind
of gas is not used in Romania. Sources with Viromet quoted by
Bursa said that the company would use carbon dioxide-rich gas to
produce methanol as well, a product currently made by Viromet.
The daily also informs that Viromet would have to invest some 14
million euros to implement the project. Transgaz managers
approved a feasibility study that would reveal the efficiency
indicators for the project, depending on which the procedures
for setting up the joint stock company are to start. Sources
with Romgaz said that the derricks drilling for the gas had been
closed down, and the re-commissioning costs are too high for
Romgaz, Bursa reports. ROMPRES
The government has started an inquiry into the privatization of
SNTR tobacco company, said minister Blanculescu quoted by
Evenimentul Zilei daily. Minister Blanculescu, head of the
National Agency for Control -- designed to support government's
investigations in such cases -- has initiated the inquiry
following the information circulated by media outlets. There are
hints that the 54% stake in SNTR has been sold at an
unreasonably low price. The privatization agency revealed only
scarce information on the investor's identity and the value of
the sold company. ISI
Romanian authorities won't allow any single investor to control
more than half of the country's refining capacity after the
privatization of state-owned oil company SNP Petrom (SNP.RO),
Economy Minister Dan Ioan Popescu said Wednesday. Austria's OMV
AG (OMV.VI) is the only company among the seven bidding for
Petrom that could cross the 50% threshold. OMV owns a 25.1%
stake in Romanian private oil company Rompetrol SA, whose
Petromidia refinery on the Black Sea coast has an annual
capacity of some 3.6 million tons of crude. If OMV obtained
Petrom's two refineries, with a combined annual capacity of
about 6 million tons of crude, it would control more than half
of Romania's refining capacity, estimated at some 12.5 million
tons a year. This could raise problems with the competition
regulator, Popescu said. "OMV have to solve this problem," he
said. The six other companies that made preliminary bids for
Petrom are Poland's PKN Orlen SA (PKN.WA), Hungary's MOL Rt. (MOL.BU),
Occidental Oil & Gas Corp. of the U.S., Russia's OAO Gazprom (GSPBEX.RU),
Greece's Hellenic Petroleum SA (ELPE.AT) and Switzerland's
Glencore (GNC.YY). Popescu said the government expects final
bids at the beginning of April. The government is offering a
33.34% stake in Petrom, where 93% of shares are currently
state-owned and 7% are traded publicly. The winning bidder will
be obliged to raise its interest to 51% by taking up a share
capital increase. DOW JONES
32,320 lei/$ on 01/26/2004
40,718 lei/euro on 01/28/2004
Lukoil
Europe Holdings BV has taken over the Romanian gas station chain
MV Properties (75 stations) for USD 121mn, reports Ziarul
Financiar daily. Lukoil Romania owned 155 stations out of the
total of 2,000 countrywide in mid 2003 while it planned for 200
by Dec 2003 and 300 by Dec 2004. The deal was reportedly signed
last year, as it has been revealed by the Commercial Register
only recently. Lukoil's local representatives kept silence so
far and refused to give details. However, Russian sources have
informed on Oct 17 last year about the deal. According to
Catavencu weekly, MV Properties has been so far owned by a
relative of Ralif Safin (head of Lukoil Europe Holdings Ltd). MV
Properties has reportedly taken over the gas stations built by
Lukoil Romania as pledged investments related to the takeover of
Petrotel refinery. ISI
The Medium and long-term external debt
declined by 2% m/m to EUR 15,248mn at the end of November, the
central bank announced. The 6% y/y growth rate was in line with
the imports' advance. Some 63% of the total debt is public debt
-- out of which 43pps public and 20pps guaranteed. The remaining
37% of the total is private (not guaranteed) debt. The
guaranteed debt has increased by an above-average 8% y/y, while
the private debt was only 5% up y/y. ISI
32,203 lei/$ on 01/23/2004
41,077 lei/euro on 01/23/2004
The Foreign Direct
Investments have reached EUR 989mn [USD 1.14bn] in Jan-Sep,
22% up y/y, according to the head of the foreign investment
agency, Marian Saniuta. On the back of widening trade deficit,
FDI has financed only 60% of the Current Account gap as compared
to 70% last year. By the end of the year, FDI is planned to
reach USD 1.5bn-1.7bn, or 2.7%-3.0% of the GDP, according to
Saniuta, while the full-year CA gap is expected at some 5% of
GDP. FDI would thus still finance more than 50% of the CA
deficit. ISI
Romania's
current account deficit widened by 61 percent to 1.647 billion
euros ($1.94 billion) over January-September from the same
period in 2002, the central bank (BNR) said on Tuesday. It said
that increase was triggered by a wider trade balance deficit
which stood at 2.389 billion euros, up from 1.867 billion in the
same period a year before. Romania's main economic mentor, the
International Monetary Fund, warned that a fast rise in real
wage and private lending are pushing Romania's 2003 current
account gap to 4.8 percent of gross domestic product from under
4.0 percent in 2002. REUTERS
The central bank is concerned
with the rapid growth of the non-government credit and considers
tightening the credit regulation for individuals, said yesterday
BNR deputy-governor Mihai Bogza quoted by Adevarul daily.
Romanian authorities are currently discussing with the IMF
officials possible ways to curb the credit growth. Tightening
lending regulations for individuals is necessary because the
credit bureau planned to screen their indebtedness has not yet
started operating, explained Bogza. The credit to individuals
has doubled over the last year while the central bank expressed
concerns with the banks' failure to turn operational the credit
bureau. The credit to individuals has increased from 1.59% of
the total non-government credit in Dec 2002 to 3.76% in Sept
2003. The risk posed by the rapid credit growth refers to the CA
widening, explained Bogza, and not to weaker stability of the
banking system. He thus took the side of the Romanian bankers,
who criticized the S&P report warning on banking system
vulnerabilities. ISI
The state regulator of utilities, ANRSC,
is preparing a bill imposing quarterly cost-based price
adjustments for the municipal heating and water utilities, reads
Romania Libera daily. The prices would be approved by ANRSC
based on the costs incurred by local utilities plus a 10% profit
margin, the daily reads. The quarterly adjustments would however
be enforced no sooner than next spring, the daily reads. Such a
move would help the utilities to cover their costs but would
require either higher heating subsidy paid from the budget, or
higher end-user prices. Currently, the municipalities are
subsidizing the difference between the price charged by
utilities and the "reference" end-user price set by the
regulating body. The end-user price was kept steady this year at
the expense of higher subsidies, which prompted criticism from
the centrist opposition that accused the ruling PSD of improper
politics prior to next year's elections. ISI
Romania's power grid operator
Transelectrica said it had signed an ?30.5 million contract with
Japanese consortium comprising Itochu Corporation and
Toshiba-Mitsubishi Transmission & Distribution Corporation to
upgrade a power station near crude oil refinery Petrobrazi. The
upgrading project of the 400/220 KW power station Brazi Vest (60
km north of capital Bucharest) will be financed by Japan's
International Cooperation Bank through a loan to be reimbursed
by Transelectrica from its own resources. Works at Brazi Vest
power station are scheduled to be completed within 33 months.
INVESTROMANIA
The State Treasury will be
ready late June 2004 to connect to the electronic payments
system in real time managed by Transfond company, which will
lead to fluidization of the financial flows, announced Enache
Jiru, secretary of state in the Ministry of Public Finance. The
first stage of the project will include connection of the
central Treasury, of the units in the six districts of the
capital as well as those of Ilfov and Cluj counties. This stage
is financed from a loan worth $700,000 from IBRD, through the
program of technical assistance PIBL II, related to PSAL II
loan. The tests will start after January 2004. The second stage
will comprise the connection of all local treasuries to the
system which implies logging on to servers of over 3,000
computers. Implementing this stage is still in the bidding
phase. There are 347 Treasury units and public accountancy in
Romania. MEDIAFAX
ROMANIA Offers Its
Expertise In Oil, Gas Financial Express, India
NEW DELHI, OCT 26: Romania has offered its expertise to the
country's oil
and gas sector, especially in transportation and pipelines. ...
ROMANIA to get Dracula theme park after all Straits Times, Singapore
BUCHAREST - Romania has given the green light to a Disney-style Dracula
theme park to be built in Snagov, Tourism Ministry official Sorin Marica
said yesterday ...
MITTAL to
buy two more plants in Romania Rediff, India
Steel baron Lakshmi Mittal is upping his investment in Romania, despite
a local threat to the future of his existing Sidex steel plant whose purchase
was ...
MARKET
economy status not granted to Romania EUobserver.com, Belgium
EUOBSERVER/BRUSSELS - A draft of the European Commission regular report
on Romania, seen by the EUobserver, shows that the country has still not
been ...
The minimum grows wage will
increase from the current EUR 65 per month to EUR 200-250 in 2007,
said yesterday minister delegate for trade unions Marian Sarbu,
quoted by Adevarul daily. The minimum wage would have to increase
three times prior to the EU accession, he explained. Regarding the
short-term prospects, Sarbu said that talks are carried for a ROL
2.8mn [EUR 70] minimum wage as of January 2004. ISI
The privatisation announcement for Petrom was supposed to be made
today, August 15, but would be probably delayed. The
privatisation strategy for Petrom was not published in the
official gazette and it had to precede the announcement.
Representatives of the privatisation department in the ministry of
economy were quoted by the daily saying that they expect the
announcement. The company was supposed to be put up for sale by
June 30, but the deadline was postponed by August 15. The
completion of Petrom> '> s privatisation was set for the end of
March next year. Unnamed sources in the market quoted by the daily
indicated that the government would make efforts in attracting big
names in the industry such as British Petroleum and Shell. Other
companies that might be interested in Petrom are: Russia's Lukoil,
Hungaria's MOL, and Austria's OMV. Ziarul Financiar
Hewlett-Packard (HP) Romania will provide to the National Company
Transelectrica IT services of ROL 50 bn (over 1.5 M USD),
acording to a contract signed on Thursday, declared Jean
Constantinescu, general manager Transelectrica. According to the
official, HP Romania was selected through an international
bidding, attended by other 4 major companies, among which IBM
Romania."Based on that agreement, Transelectrica will externalize
the IT services for the two locations of the central headquarters.
HP will take care of everything which means hardware, software
licences, IT networks, maintenance operations, upgrading the
equipment, consumables, replacement of deficient spare parts,"
added Constantinescu. The company has not yet discussed the
implementation of such measure in its branches around the country.
Nine O'ClockBucharest
Transelectrica electricity carrier reported a gross profit of ROL
237bn in H1, stated Jean Constantinescu, head of the company.
The operating revenues amounted to ROL 3.608bn. The receivables
marked a significant reduction by ROL 244bn y/y. In terms of
profitability, ROE was 6.8%, while the liquidity ratio was 1.54%.
Constantinescu added that the company intends to reduce by half
the receivables till the end of 2004. As of end of June 2003,
total receivables amounted to ROL 1,936bn.
The state might accept the proposal of Dinu Patriciu, head of
Rompetrol, for debt conversion of Petromidia refinery into
shares. The move will turn the state into a shareholder of the
refinery with a stake of 35%. Patriciu made this proposal in the
spring. The debts of the company stand at USD 325mn. As of the
beginning of this year, Petromidia has split its activity in
refining and petrochemical units. Rompetrol Refinery has two
refineries, Petromidia and Vega, while the other unit is called
Rompetrol Petrochemicals and holds all assets in the petrochemical
field of the group. The conversion of debts into equity would
allow Petromidia to continue several investment projects for
meeting EU standards by 2005
