“What’s important to note is that Romania had a bit of political turmoil immediately before the crisis started,“ begins Florian Nitu, Partner at Popovici Nitu Stoic & Asociatii in Bucharest. “The Prime Minister and the President engaged in a political struggle, with the PM backed by the left-wing socialist party coalition in power. Luckily, this conflict was resolved and tensions decreased – just when Covid-19 hit Romania.“ As a result of this decrease, he says, the country was able to tackle the crisis without unnecessary distraction.
“Authorities reacted quickly, especially compared to Western European countries, and the lockdown measures were placed quickly,“ Nitu says. As a result, Romania has kept its numbers in check, and at the time of writing has reported only over 16,000 confirmed cases. “The healthcare system was not put under insurmountable pressure and this allowed for the entirety of the country to be helped, not just major cities.“
Nitu says that, in his opinion, the government did a good job of protecting the economy as well. “The easing of the measures is set to start on May 18, after a full two-month lockdown.“ He says that over the next four to six weeks “all restrictions will be gradually lifted, but that won’t mean we’re going to be returning to the same place we were immediately pre-COVID, as additional health and safety measures will remain in place."
Nitu says that the government has done “a lot to support SMEs, not just in terms of subsidies and tax cuts, but also by providing access to alternative financing and short term financial aid like overdrafts, credit lines, and similar short term capital infusions.“ Romania will also benefit from access to EU relief programs, but Nitu says that “big businesses are still left mostly on their own for now – an aid package for them has yet to be announced.“ He thinks this will happen, along with additional investment subsidies, in upcoming weeks.
Finally, Nitu says that “almost the entirety of the legislative agenda is focused on the crisis,“ and that “the government is considering additional measures to handle infrastructure development, stabilizing the construction sector and publicly-funded projects.“ He adds that the first pieces of legislation not tackling the crisis directly are likely to deal with updating the frameworks for public procurement and PPP. The real estate sector, he says, will also be “targeted for stimulation, as well the automotive industry. These have been hit hard and the government will have to help them.“
