What the newspapers say: May 5, 2009

The European Union is about to take some actions against Romania, because of its high budget deficit. Incredible as it may seem, this may represent some good news, since a monitoring over the governmental spending may prevent excessive electoral campaigns. This year, Romania will organize two rounds of elections, one for the European Parliament and one for the Presidency.

The former campaigns were defined by the „electoral charity” – gifts for the poor voters. According to Evenimentul Zilei, the way the money will be spent this year will have to take into account the budget deficit target Romania negotiated with the International Monetary Fund and the EU, in order to obtain the 20 billion Euros loan.

In case the budget deficit target is not reached, Romania risks to lose European funds, Cotidianul adds. After a 5.6% deficit in 2008, Romania should end this year with a 3% deficit in order to avoid EU penalties. According to the European Commission, Romania will have a 5.1% deficit in 2009, below the 7% expected at the beginning of the financial crisis, but still well above the 3% demanded.

The good news is that the IMF approved the 12.95 billion Euros loan for Romania, the first share – of five billion Euros – being expected to enter the country during the following 24 to 48 hours, Evenimentul Zilei reads.

In the economy, the free-falling prices for apartments still fail to unblock the real estate market. Higher interests and a 25% advance payment for real estate credits are the main reasons why Romanians still won’t borrow money from banks, Cotidianul comments.

But the international economic crisis has a brighter side too: several European companies, mainly from France and Germany, decided to relocate to Romania, in order to cut costs. The French group Saint-Gobain will open a new mortars and industrial adhesives factory in Romania, the German tires producer Continental shuts down its factory in France but continues to invest in Western Romania, while the lingerie producer Dim SAS prepares to invest some 500,000 Euros in a production facility in Romania, Romania Libera reads.