Only 30 pc absorption of EU funds for infrastructure in H1

The reasons for this situation are very poor performances where construction work, acceptance of payments, and reimbursements are concerned. CNADNR and CFR SA are the main beneficiaries of SOP-T.

The absorption of funds provided by the officials in Brussels remains a problem for Romanian authorities. The lowest absorption rate by individual program was reported in the transport sector.
“More precisely, the beneficiaries of the European funded program for transport infrastructure (SOP- T) for the 2007–2013 period have failed to submit ’substantial’ reimbursement requests in the first half of the year, which resulted in an absorption rate of European funds well below the first-six-month target,” Catalin Costache, director of the Programing Directorate of the Managing Authority for Sectoral Operational Program Transport (MASOPT), stated at a conference entitled ‘Mediafax Talks about Transport & Logistics.’
“The 2014 absorption rate is EUR 1.1 – EUR 1.2 billion. However, the first quarter results are not optimistic. Only 30 percent of the target was achieved due to poor performances where construction work, acceptance of payments, and reimbursements are concerned. The program beneficiaries did not submit substantial reimbursement requests,” Costache said. CNADNR and CFR SA are the main beneficiaries of SOP-T, as around 95 percent of the allotment of this program is directed at the two companies.
While the European Commission’s overall reimbursements for SOP-T amounted to EUR 876 million early this year, by late May the amount had increased to EUR 1.383 billion, according to the Ministry of European Funds. The dis-engagement threshold (amount Romania must absorb in order not to lose the money) set for Romania this year is EUR 690 million, the director said further. By the end of May, Romania had managed to attract only a third of the EUR 4.4 billion allotted by the European Commission for SOP-T 2007-2013. Even though our country is in a race against the clock for attracting the remaining EUR 3 billion available until the end of 2015, the state has only authorized reimbursement requests for EUR 53 million in the first five months of the year.
Slow development due to changes in ministry leadership
“The pace of development in the infrastructure sector will stay low as long as the minister delegate is changed every three months, while Romania’s competitiveness is affected by over-regulation,” Radu Merica, president of the Romanian – German Chamber of Commerce and Industry – AHK Romania, stated at the event. “I trust the new leader of the ministry, Mr. Rus, a man who has proven he knows how to lead a ministry, will be as efficient in the Ministry of Transport,” Merica added. Since February 2012, the Ministry of Transport was run by six different ministers – Alexandru Nazare (PDL), Ovidiu Silaghi (PNL), Relu Fenechiu (PNL), Ramona Manescu (PNL), Dan Sova (PSD), and Ioan Rus (PSD). The Chamber of Commerce president also pointed to the excessive regulations implemented in many fields including transport in Romania, which affect the competitiveness in this sector. “We have differing tariffs and security and certification costs; we are no longer competitive and soon every plane will be registered in Germany and every car in Bulgaria,” Merica emphasized.
The Ministry of Transport leadership is replaced at very short intervals. Just when “they finally find out where the elevators are,” ministers are replaced and they have no time to become familiarized with or solve the problems in their sector, Radu Dinescu, Secretary General of the National Union of Road Hauliers from Romania (UNTRR), also stated. In Dinescu’s opinion, the state does not reward employees who perform well and the legislation needs to be simplified and applied appropriately. Moreover, the UNTRR official criticized the introduction of the additional fuel tax and the approval of norms for the partial reimbursement of the excise tax.
Last CFR marfa employee on the list to be dismissed by end of month
Another topic of discussion at the event organized by Mediafax was CFR Marfa’s layoffs, as the company initiated the dismissal procedures for 2,500 employees this week. “(…) People will be given notices and all legal steps will be followed. They will probably effectively leave the company in the second half of July,” Ion Soare, commercial manager of CFR Marfa, announced. He estimated that the dismissal process will be finalized by the end of the month. The departure of the 2,500 employees will not affect the railway operator’s ongoing contract, Soare noted. The Gov’t has agreed before the IMF to aggressively restructure CFR Marfa and continue the privatization process with a strategic investor.
Leasing market’s first positive trend since 2008
“The leasing market has reported a 28 percent increase in the first four months, the first positive trend since 2008, while the great results at the start of the year create the premises for growth throughout the entire year,” Oana Stoenescu, sales director at Garanti Leasing, said in a different discussion panel of the same conference. She pointed out that car leasing, in particular commercial cars, accounts for 73 percent of the market, real estate leasing accounts for 5 percent, and the remaining 22 percent is made up of equipment leasing. In her opinion, in order to make the leasing market more dynamic, it is absolutely necessary to support economic growth by helping Romanian entrepreneurs.

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