The Social Democrat (PSD) leader Sorin Grindeanu has unveiled on September 11 the first draft of a plan aimed at economic recovery, targeting 3% annual economic growth within several years, bringing the trade deficit in goods under 8% of GDP from 9.5% currently, and creating 120,000 new jobs predominantly in high value added industries through a combination of state guarantees and tax credit for companies investing in new, particularly high-tech, projects and subsidies for young employees.
The plan, introduced by Grindeanu with the view of being promoted by the cabinet of prime minister Ilie Bolojan, is still to be detailed, Cursdeguvernare.ro reported. However, PSD has not discussed the strategy with the ruling partners yet.
The “recovery plan” is seen by PSD as a balancing measure after the two “austerity packages” promoted by prime minister Ilie Bolojan (Liberal, PNL) – but also as a means to rebalance the power in the ruling coalition and, at the level of the Social Democratic Party, as a political program for Grindeanu’s candidacy in the upcoming party elections.
Sorin Grindeanu said that the plan will be presented in the coalition, and the other parties are expected to come up with their own ideas or improvements to the PSD measures.
He claims that the plan “will not put pressure on the budget” since it “does not entail public spending.” The measures will either self-finance or will be funded from the European funds, he explained.
The plan includes three major pillars.
The first envisages tax credit for new investments and disadvantaged areas, and state guarantees for SMEs (with criteria to prioritise high-value-added sectors).
The second pillar envisages a special (50%) tax credit for investments in data centres and AI, hardware and critical software, and a super-deduction of up to 200% for R&D expenses and a 30% tax credit for R&D and innovation expenses and access to low-cost innovation credits.
Under the third pillar, PSD proposes granting from EU funds a stability bonus of RON 1,000 (EUR 200) per month in the first 12 months of employment and RON 1,250 (EUR 250) per month in the following year, granted to young people in the NEET category.
In addition to the three pillars outlined by leader Grindeanu, the PSD ministers came up with specific measures for their sectors.
Alexandru Rogobete, minister of health, proposed expanding the capacities of biosimilar drugs and molecules at the national level and expanding factories that produce sanitary materials.
Bogdan Ivan, minister of energy, came up with two measures. Firstly, he proposes “priority access at reasonable prices” to the gas produced on Romanian territory for energy-intensive companies – fertilisers, pyrolysis plants.
This measure, still to be clarified (since it has an impact on competition), is expected to lead to a reduction in the trade deficit by at least EUR 1 billion. As part of this measure, the state-controlled Romgaz will take over the Azomures fertilisers producer, in order to deliver inputs at affordable prices to local farmers.
A second measure proposed by minister Ivan is the creation of financial instruments, funds for strategic investments in energy generation (nuclear, hydro, natural gas). He plans to use European funds – from the Modernisation Fund or other international instruments – and European resources, for this.
iulian@romania-insider.com
(Photo source: Inquam Photos/Pana Tudor)
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