00:07DZIENNIKARZ
00:08Joining me is Romania's Finance Minister Aleksandru Nazare.
00:12He has just unveiled a new economic recovery package for Romania
00:16aimed at boosting investments in the country
00:18and is also leading efforts to bring down the budget deficit.
00:23We're here in Brussels today where Minister Nazare
00:26has met with EU Finance Ministers for talks.
00:28Minister, welcome. Thank you for joining us.
00:30Thank you and thank you for the invitation.
00:32Let me start with the domestic situation in Romania
00:34because new data suggests that the country is now in a technical recession
00:39but you've said that we need to be optimistic,
00:42that you have measures that will turn things around.
00:46Tell us more about this economic recovery package
00:49that you hope will boost investments in the country.
00:52First and foremost, I would say that conditions related to Romania,
00:56also the relation with the European Commission
00:59and the way Romania is perceived in the Council is much better now.
01:03It's significantly improved compared to what it was six months ago.
01:09So six months ago there were all sorts of discussions
01:11regarding the rating agencies, about Romania's rating,
01:16about the RRF, the renegotiation of the RRF,
01:21the possibility of not meeting the deficit target that we had for last year
01:28and all these things are gone.
01:31We've met the deficit target for 2025
01:34but we overperformed with 0.7%.
01:37We succeeded to reduce the deficit from 0.6% in cash terms
01:42to 7.6% in cash terms.
01:44The primary deficit, which is even more important,
01:47was reduced 1.5%.
01:49And most likely the ESA deficit will also have around 1% adjustment.
01:58So all these things performed in six months
02:01along with our consolidation packages,
02:05which were more than 3% of GDP,
02:08ensure that we are much more closer to our trajectory than before.
02:14Yes, your country still has one of the highest deficits in the bloc.
02:20It's under the excessive deficit procedure.
02:23The Commission is urging you to take further action
02:25and it is also affecting borrowing costs.
02:29When it comes to that interest rate on government's debt,
02:35is that something that you're prioritising?
02:36because it remains very, very high
02:38and it's impacting, I would imagine,
02:40your country's capacity to really move on and make progress.
02:44This was one of our primary targets
02:46because in order to accelerate the economic recovery,
02:50in order to support growth,
02:53we need to bring the interest rates down.
02:55And if you look, there is a very big difference
02:58from what it was in May last year.
03:00So for the maturity of 10 years,
03:03for the RON, not for the Euro,
03:06the interest rates went from 8.5% to around 6.5%.
03:12So it's almost 2% reduction of interest rates
03:16in around six months.
03:18This will help Romanian economy in 2026
03:23because it will help the crediting in general.
03:26It will bring more money into the economy
03:29and will allow more investments in Romania.
03:31You seem to have a very optimistic tone,
03:32but I do believe that Fitch has kind of raised issues
03:36and there are doubts around the credit rating.
03:39Is that something that concerns you?
03:40I think the discussion with Fitch that we had in January and February
03:45is much better than the discussion we had in August last year.
03:49It's a completely new tone,
03:51completely new way of addressing the issues.
03:56Fitch recognizes the progress that Romania has
03:59and of course underlines future risk.
04:01I know, Minister, that you've been part of talks around the economy
04:05in Romania and the wider EU for many years.
04:07You've been part of a minister's gathering here many times before.
04:12What is the trajectory for Romania in terms of joining the euro?
04:17Because we know that several other finance ministers,
04:19such as the Polish counterpart of yours,
04:21is saying we're not interested in joining the euro.
04:23We have our own currency.
04:24What are Romania's aspirations?
04:27First of all, we need to raise the ambition
04:30towards how we treat economy in general.
04:34Our ambition regarding where we want to see
04:37Romanian economy needs to change.
04:40And this is part of what we're doing.
04:43And in order to do this, of course,
04:46we need to exit the excessive deficit procedure.
04:50We spent too much time the last five years
04:55in the excessive deficit procedure.
04:57And now with the measures that we've taken,
05:00we come back in the trajectory.
05:02We return to where we were supposed to be
05:04in order to be able 2029, 2030 to exit the procedure.
05:10And for the euro is the same discussion.
05:12We cannot discuss euro before we do this,
05:16before we get out of the procedure.
05:18So this is a prerequisite.
05:20And this is a very important project for Romania
05:22that fiscal discipline comes back,
05:27measures to support the economy
05:29and to support growth in a very intelligent way,
05:33aligned with what Draghi and Leta
05:35are projecting for entire euro.
05:38And this is what we put in our recovery,
05:41economic recovery plan,
05:43in our economic recovery program
05:45that we still recently presented.
05:47So we basically have a completely modernized menu
05:51for attracting FDI in Romania.
05:54It's a very coherent menu
05:57that Romania didn't have until now.
05:59We will have an instrument for investments
06:02over 200 million in Romania,
06:05which will be very flexible with grants,
06:08with tax credits,
06:10with different ways of,
06:13let's say,
06:16avoiding bureaucracy,
06:17ensuring that the lands are given
06:19by local administrations
06:21for bigger investors,
06:22ensuring ways in which the investors
06:24should be treated differently.
06:26You mentioned Draghi and Leta,
06:28and I'd like to take a look
06:30at the European situation
06:31because we know now
06:32that by the summer, by June,
06:34the EU wants to introduce
06:35specific measures
06:36measures in order to regain
06:38its competitive edge.
06:40Some of the ideas on the table
06:42include euro bonds,
06:44so more joint borrowing
06:45at the EU level
06:46in order to fund strategic investments.
06:48Is this something Romania supports?
06:50We've done it with
06:52the next generation.
06:54We've done it again with SAFE.
06:57I think if this is aligned
06:59with our strategic priorities,
07:01and definitely it somehow responds
07:05to the investment
07:06European economy needs
07:08in certain strategic fields
07:10like AI, for instance,
07:12or all these areas
07:16in which Europe needs investment,
07:18if these things are aligned,
07:20yes, I think it's a very good idea.
07:22And what about the other concept
07:23that's being floated mainly
07:24by the French
07:25for prioritizing made in Europe,
07:28giving a European preference
07:30in public tender contracts
07:32and so on?
07:33Is this something that you also
07:35think it's a good idea?
07:36It supports the strategic autonomy
07:38that we're discussing.
07:39I mean, this should be
07:40a European project
07:41and this is the core
07:43of the project.
07:44I mean, imagine,
07:45imagine that
07:47ever since European Union
07:49was created,
07:50this was the entire idea behind.
07:53That should be one powerful block,
07:56a pan-European block.
07:58But even if that would mean
08:00limiting the amount of,
08:01let's say, American products
08:04that can be bought.
08:05I know that Romania
08:06has a very strong
08:08economic relationship
08:09with the U.S.,
08:09but the world order
08:10is changing swiftly.
08:12Is that going to impact,
08:13do you think,
08:14Romania's relationship
08:15with the U.S.
08:16and Europe's relationship
08:17with the U.S.?
08:18I think the more we create
08:21an investment-friendly environment
08:23in Europe,
08:24the better.
08:25Now we have
08:28300 billion of our savings
08:31invested abroad.
08:32If we make the best
08:33that these billions
08:35invested abroad
08:36are invested in Europe,
08:37it's very good for Europe.
08:39So we don't necessarily
08:40have to look at
08:41the competitiveness,
08:44we have to look
08:45on how to better
08:46use the savings
08:47that we already have
08:48as European Union.
08:50There's also talk,
08:51however,
08:51of this two-speed Europe.
08:53So a Europe
08:54where a group
08:54of maybe powerful economies
08:56move ahead on their own
08:57and leave others behind,
08:59for example,
09:00to implement
09:00a capital markets union,
09:02which is something
09:02you've just mentioned.
09:03Do you fear
09:05that risks
09:05leaving countries
09:07like Romania left behind?
09:10Romania supports
09:11the capital markets package.
09:13Romania supports
09:14the savings
09:15and investments union.
09:17The entire discussion
09:19in Ecofin,
09:20we say it,
09:23we said it
09:23in the council.
09:24In these six months,
09:26I always said it.
09:27I always said
09:28we need to accelerate
09:28this package.
09:31If this format
09:32is accelerating
09:34some of the files
09:35that we already have
09:36in Ecofin,
09:36I think that's
09:37a good idea.
09:39But, of course,
09:40this is very important
09:42to, let's say,
09:44dynamize the Ecofin
09:45a little bit
09:46on some specific topics.
09:48We will find out more
09:50about what is the,
09:51let's say,
09:54agenda,
09:56criteria
09:57for what the group
09:59will do.
10:00But yet,
10:01we don't know.
10:02It's just one meeting.
10:03It was just
10:04the letter announced,
10:06so it's so early
10:07to comment
10:07on what will happen.
10:08There is this E6 formation
10:10that's already been established,
10:11it seems,
10:12with these six heavyweights.
10:13Do you think it's positive
10:15whether they will pull Europe
10:16in the right direction
10:16or is it creating divisions?
10:18I think we should see
10:20what eventually will happen
10:22out of the E6.
10:24I'm in very close touch
10:25with the German minister
10:27we met today.
10:28I'm in also very close touch
10:30with the French minister
10:31on all of the files.
10:33I don't think they plan
10:34to leave anybody behind.
10:36I think they plan
10:37to solve some of the critical issues
10:39that are on the table.
10:40And if they succeed,
10:41it's a very good thing
10:42for Europe.
10:42Finally,
10:44to close,
10:44minister,
10:45one of the big areas
10:47of opportunity
10:48in terms of investment
10:49is obviously
10:50defence spending.
10:52Romania is a country
10:53on Europe's eastern flank.
10:55It has experienced
10:57drone incursions
10:58and so on
10:58very recently.
11:00How important
11:01is this scaled-up investment
11:04in the defence industry
11:05for your country?
11:06I think it's very important.
11:08We want our national
11:09defence industry,
11:11we want to support
11:12the national defence industry.
11:14That's why we created
11:15also a special scheme
11:16for this of 200 million euros.
11:18Of course,
11:19SAFE is much bigger.
11:20We negotiate.
11:21I was very much involved
11:22in the negotiation of SAFE.
11:24It happened
11:25in the Ministry of Finance
11:26and we managed
11:27to secure
11:27the second biggest allocation,
11:3016.2 billion.
11:32Part of SAFE
11:33is also infrastructure
11:34for dual use.
11:36There are very important
11:37pieces of highways
11:38which will be built
11:39with SAFE money
11:41in Moldova
11:43around Jash.
11:44Those are critical
11:45pieces of infrastructure.
11:47So SAFE
11:47is very important
11:48and I think
11:48it's a very good project
11:50for Europe.
11:51Minister,
11:52thank you so much
11:52for joining us today.
11:53Thank you for the invitation.
Comments