Romania-Insider Monthly Wrap-up for October: A ship without a captain in the middle of the storm

02 November 2021

Andrei Chirileasa

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Our monthly overview for Romania Insider members brings you the main topics of the month, to make sure you don't miss the bigger picture, no matter how often you choose to read the news. If you choose to stay away from much of the media frenzy, this monthly bulletin brings the essentials without wasting a lot of time, in a basic visual version, so you can focus on the text alone.

Opening photo: COVID-19 patients waiting to be admitted into Bucharest hospital - Photo source: Inquam Photos / Octav Ganea

A ship caught by a huge storm, navigating without a captain. An image that reflects rather well Romania's current situation: caught in the worst sanitary crisis of the last 30 years without a fully operational government.

The fourth wave of the pandemic hit Romania hard in October and pushed the country to the top of the COVID-19 death rate ranking. Local hospitals were overwhelmed by the number of serious cases. In total, over 414,000 new COVID-19 cases were reported in Romania in October, representing about a quarter of the total number of cases recorded since the beginning of the pandemic. At the same time, over 10,700 people lost their lives due to the disease last month, according to official data.

Faced with this situation, Romania's president Klaus Iohannis, had to come out on TV and announce new restrictions, four months after he declared that "we have stopped the pandemic!" Most of the new restrictions apply to those who are unvaccinated and don't hold a "green certificate", which has somewhat revived the vaccination campaign. However, the overall vaccination rate in Romania remains well below the EU average, which is why the fourth wave hit the country so strongly.

However, Romania's response to the pandemic remains largely inconsistent, with many decisions that seem arbitrary. One reason for this is the political crisis that has unfolded in the last two months. It started with the reformist party USR leaving the ruling coalition in September and continued with the dismissal of Liberal Florin Citu's cabinet by a no-confidence motion at the beginning of October. Instead of pushing the parliamentary parties to forge a new ruling coalition and a new government as soon as possible, president Klaus Iohannis preferred to prolong the crisis by supporting the scenario of a minority Liberal cabinet. He first nominated the new USR leader Dacian Ciolos to form a government, without any real chance of success. Then, when Ciolos failed, he nominated defense minister Nicolae Ciuca for prime minister. However, Ciuca's Liberal cabinet has little chance of getting enough votes in the Parliament.

If Ciuca also fails, all options remain open, including that of early parliamentary elections. However, this would be the worst option for the president and his Liberal party, whose score in the polls has dropped dramatically since the parliamentary elections held at the end of last year. Meanwhile, the social democrats and the radical party AUR have gained a lot of ground in the polls.

Besides the health crisis, Romania is also confronted with an energy crisis, which could make this winter very difficult. Electricity and gas prices have gone up to record highs determining a chain of price increases. The inflation rate reached 6.3% in September and could go even higher by the end of the year. In this context, Romania's National Bank (BNR) increased the monetary policy rate in October and analysts expect more hikes down the line. Higher interest rates could slow down the post-pandemic economic recovery, but the international financial institutions (World Bank and IMF) and rating agencies remain optimistic for now.

Energy remains one of the hottest areas in the business sector, with many new projects in the renewable energy segment. The biggest transaction of the year could also come from the energy sector after Romania's state-controlled gas producer Romgaz said it reached an agreement with US group ExxonMobil for taking over its stake in the Neptun Deep offshore gas project in the Black Sea.

The Bucharest Stock Exchange is heading towards its best year in recent history, with several big local companies turning to it for financing in October. At the same time, local venture capital funds continued to pour money into local startups last month.

In social news, seven people died last month after another fire at a large hospital in Romania while Timisoara, one of the largest cities in Western Romania, was left without public heating.

Placebo and Pet Shop Boys announced they would have concerts in Romania next year. Meanwhile, a Russian-Ukrainian team won the Dota 2 world championship in Bucharest and Estonian tennis player Anett Kontaveit won the Transylvania Open in Cluj-Napoca.

Below, you can browse through the most important topics in October, grouped by relevance. By clicking on a title, you can read the whole article on the Romania-Insider.com website.