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January 28, 2023

The effects of the Brexit vote on Romania: President Iohannis calls emergency meeting at the Cotroceni Palace

President Klaus Iohannis welcomed the political consensus expressed on Friday by the political leaders he discussed with at the Cotroceni Presidential Palace, as they view Romania’s stability as an asset in the negotiations that will follow in the EU on the Brexit, and consider that this advantage should not be put under doubt.


Iohannis: Political leaders agree Romania’s stability is an asset in upcoming negotiations with EU


“I was very pleased to see there is consensus among the political leaders. They all agreed that Romania’s course should be within the EU, at the side of the other member states. They all agreed that an important asset for Romania in all the future renegotiation stages is stability and the fact that the country registers economic growth. And everybody agreed that this asset should not be placed under doubt for electoral reasons,” said Klaus Iohannis after the emergency meeting he called at the Cotroceni Palace in the aftermath of the Brexit vote.

Attending the consultations at Cotroceni Palace on Friday were Prime Minister Dacian Ciolos, National Bank of Romania (BNR) Governor Mugur Isarescu, co-chairs of the National Liberal Party (PNL) Alina Gorghiu and Vasile Blaga, national leader of the Social Democratic Party (PSD) Liviu Dragnea, national leader of the National Union for Romania’s Progress (UNPR) Valeriu Steriu as well as co-chair of the Alliance of Liberals and Democrats (ALDE) Daniel Constantin.


 President Iohannis: “We regret this vote, but respect it; Romania is convinced EU must go on”


Romania stays attached to the European design, as it is convinced that the EU must go on, President Klaus Iohannis said Friday.

“We have assessed the situation created by the referendum held yesterday in the UK and which, unfortunately, resulted in what is already known as Brexit, namely UK’s leaving the EU, which we regret. We regret this vote, but, at the same time, I want to say it very clearly that we respect this vote. The EU is a very valuable project; Romania has been a country that wanted to be an EU member from the very beginning, a country that has strongly supported the European idea. Given the circumstances, I want to say it very clearly after these consultations: Romania stays attached to the European design; Romania is convinced that the EU must go on, it is a good project and we must be a part of it,” the head of state said Friday, at the end of an emergency meeting at Cotroceni Palace on the Brexit effects.

He added that “unity and solidarity are still needed inside the EU, in the 27 member states which will remain in the Union.”

“At the same time, it is very important for Romanians to understand that at this moment we should stay calm and there is no need to overreact,” the head of state said.


Iohannis: UK’s leaving EU, a lengthy process; Romania will carefully negotiate for its nationals


Part of the discussions inside the European Union on the UK leaving the union, Romania will negotiate so that its interest will be protected and also cheerfully for the Romanians who are living and working in the UK, Romania’s President Klaus Iohannis said Friday.

“There are many issues that the public opinion should know. First, the UK’s pulling out of the EU will not happen overnight. It is a process that will take quite some time to complete. Specialists are estimating it to take two years, in which time negotiations will be conducted. I can assure you from the start that Romania is a party to the negations and it will negotiate in order to protect its interest. Very importantly, Romania will negotiate so as to take care of the Romanians living and working in the UK,” Iohannis said at the end of an emergency meeting on Brexit outcomes at Cotroceni Palace..

He added that after leaving the EU, the UK will stay an important partner to Romania, but it will be in no privileged position in relation with the European Union.


“Impact on Romanian economy not significant; national currency not to encounter difficulties”


President Klaus Iohannis said that data with Prime Minister Dacian Ciolos indicate the Brexit impact on the Romanian economy “is not significant,” and data with the National Bank of Romania (BNR) Governor show the shock on the national currency is “low and manageable.”

“The prime minister assured me that the Brexit impact on the Romanian economy isn’t significant; there is no reason for concern and this impact will be managed without any major difficulties. I have requested and received data from the BNR governor; they show the impact on the national currency is low and manageable. Our leu will not have problems, the BNR governor assured us,” Iohannis pointed out at the end of an emergency meeting at Cotroceni Palace on the Brexit effects.


PM Ciolos: I regret the outcome of UK referendum; we respect the option


Romania’s Prime Minister Dacian Ciolos said Friday that he regrets the outcome of the UK’s referendum on EU membership.

“Regretfully, I have learned about the outcome of the referendum in the UK. That is an option of the British people we respect. I want to tell you that the message I have taken from the conversation with Mr President, with the governor of the National Bank of Romania and political leaders is that Romania wants to continue on its European path and be a proactive player in the development of the EU that will certainly follow this decision of the UK,” Ciolos said at the Government House on Friday.

He added that a first analysis shows there will be no immediate significant impact on Romania’s economy, and the same is valid for Romanian nationals living and working in the UK.

“Our first analysis indicates that there will be no significant immediate economic impact on Romania following this decision. We will continue to pay attention to the developments, we will continue to look at analyses; there will certainly be an impact on and some developments in Romania’s economy as well, the same as there will be at a European and international levels. But, the main message is that economically speaking, given the current circumstances, (…) we do not expect any short-term significant impact. Another message I want to convey, especially to the Romanian nationals living and working in the UK: there will be no immediate impact on the rights and obligations they have there as Romanian nationals and as European citizens,” said Ciolos.

He explained that it will take at least two years for the outcome of the UK referendum to be implemented, during which negations will be conducted to which Romania will be an active party.

“According to a first analysis that European institutions have also made, it will take at least two years for the framework and the conditions of the UK’s leaving the EU to be negotiated over, as the UK officials will have to make the referendum outcome formal in a formal request to the European institutions. The next stages entail a formal request (…) after which exit negotiations will start between European institutions and the UK, with Romania taking part actively in the negotiations to make sure the exit will take place under circumstances that meet our expectations as well. This will be a process that will take time to complete and which will allow us to voice our opinions,” added Ciolos.


Prime Minister calls to prudent political decisions in election year, use of good economy condition in Brexit context


Romania should turn its good economic condition into an asset for increasing its profile in the European Union, Prime Minister Dacian Ciolos declared on Thursday, after discussing the Brexit with his deputies and foreign affairs minister.

As 2016 is an election year in Romania, he called for caution in political decisions.

“Romania presently enjoys a good economic condition, and it is very important to make it – through the measures we take and the attitude we have in the near future, both at government and political class levels – an asset to increase Romania’s possible role and impact as a EU member state in the forthcoming talks. From this point of view, I cannot but call to caution in the political decisions to be taken in this election year, especially the political decisions that might have an impact on the budget; political decisions that generally might impact the economy,” the prime minister told media at the Victoria Palace (government seat) ij a briefing on the UK referendum for leaving the EU.

Ciolos said that analysis will be carried on in his government to assess the possible impact of the UK move on Romania.

“We shall work and continue our analyses along three lines: economic, social and institutional. We will submit these elements to debate and talks; we will inform you, because I think it’s very important that the positions we build, the debates we organise be based on facts and elements as accurate and factual as possible, to keep this debate within reasonable limits of calm and predictability,” he insisted.


Senate Speaker Tariceanu : Senate will analyse predictable effects of UK vote


Chairman of the Romanian Senate Calin Popescu-Tariceanu says the Senate’s parliamentarian groups and the Committee on Foreign Affairs will analyse the predictable effects of the recent vote on the UK leaving the European Union and publish their conclusions.

“As I stated some days ago, we would have liked the outcome of the UK referendum to be in favour of the UK remaining in the EU, but we all, European citizens and governments, have an obligation to respect the majority choice of the UK electorate. The UK giving up on its EU membership, when officially demanded by the Cameron Government, will take two to five years to materialise by a procedure that will be applied as a first. Until then, the European institutions, the governments of the member states and all bodies involved will make their own estimates and analysis and act accordingly. In this sense, I want to commend President Iohannis for his preoccupation materialised in the talks he has initiated today at the Cotroceni Palace, which will surely continue after thorough analysis of all the factors involved,” Tariceanu said in a press statement released on Friday to Agerpres.

He says Romania should continue to be a loyal partner to the European Union.

“I believe I am speaking in the name of a majority of the Romanian people, the political forces and public administrations when I say that Romania will continue to be a loyal partner to the European Union acting in the spirit of solidarity that has made this design possible,” said Tariceanu.


Finance Ministry reassures on manageable Brexit effect


The effects of the British vote to leave the European Union are manageable for Romania, the Ministry of Public Finance asserted in a release to Agerpres on Friday; foreign currency reserves are available, and international borrowing can be postponed until markets stabilize.

“The Ministry of Public Finance monitors closely the evolution of financial markets on European and international levels, and is permanently in contact with its European partners and with the international and national financial institutions. On the short term, we are witnessing volatility on the national, regional and international financial markets. Nevertheless, the Romanian state has a substantial reserve of foreign currencies, which could be used to attenuate the risks resulting from the increase of financing costs, offering the flexibility of adapting the size of sovereign bond issues in the forthcoming period, until markets are stabilized,” the document reads.

The ministry also mentions Romania’s strong economic performances: 4.3 percent economic growth in the first quarter of 2016; balanced budget execution in January-May; public debt among the smallest in the EU; strong downtrend of the private debt and borrowing in foreign currencies. Consequently, it expects a moderate long-term impact of the Brexit on the main economic indicators, but warns on the need for prudent fiscal and budget policies and calls for responsibility in promoting measures that could impact the budget targets and worry the financial markets.

On a EU level, the Brexit compels to dialogue on the practical means of managing the impact, the release adds. “Romania will actively participate in these discussions, having an important say from the perspective of all resulting implications. One of the effects taken into account is the impact on the EU budget, to which the United Kingdom contributes significantly.”


BNR’s Suciu: Romanian leu less depreciated than other currencies in the region


Romania’s leu exchange rates dropped less than those of other currencies in the region following the UK referendum for leaving the EU, National Bank of Romania (BNR) spokesman Dan Suciu noted on Friday. He explained that the impact of the vote for the Brexit was milder thanks to the central bank’s awareness of this risk, and to the smaller size of Romania’s financial market. BNR insists on every occasion that it has the instruments to intervene on increased volatility of the national currency, he added for Agerpres.

“The Friday’s depreciation of the leu was predictable, because the event occurring after the vote in the British referendum is an event of significant risk. This risk had been defined by the National Bank in its Financial Stability Report in April and in its annual report released a couple of days ago. Thus, without saying it has been anticipated, it has been taken into account. But we saw the volatilities on our market, which although existing did not exceed the calculated parameters in a worrisome way. Indeed, we saw the noon exchange rate – 4.5366 lei/euro – that indicates a smaller depreciation than in the case of other regional currencies that underwent the same process,” Suciu explained.

Besides the leu’s position, not on the front line of volatilities, the BNR also has its monetary policy interest rate, its foreign currency reserves, and the possibility to intervene adequately in the market, and the market is aware of these facts, Suciu insisted.

According to him, the BNR expects the volatility to continue in the near future, but within manageable limits. “Obviously, we have a horizon of uncertainties in the forthcoming period. At least from an institutional point of view, a negotiation process will follow, which cannot calm down the markets,” he said.

As regards the higher quotation of gold, the spokesman asserted it was expected, as bullion and the U.S. dollar are haven investments in uncertain times in Europe.

The central bank, however, will have to analyse and weigh very carefully its monetary policy decision expected next week, said Suciu.


BVB CEO Sobolewski: Brexit impact, very diverse, not always negative


The impact of Brexit is very diverse and not always negative and these days the stock markets are good for those who are buying, Bucharest Stock Exchange (BVB) CEO Ludwik Sobolewski told Agerpres on Friday.

First, he said, it confirms the authenticity of the saying that the only thing constant in life is change. Secondly, in respect to the world of investment, the inevitable negative implications in terms of EU policy may produce a change in the attitude of investors and financial institutions. The reasoning, points of view and opinions, he said, can be shaped up more on a case-by-case basis and not in a restricted set of global indicators, the latter being typical for global capitalism, which could be a good change for countries such as Romania. Thirdly, he said, London’s part as global financial centre will be consolidated, because the City will not be submitted to the EU’s bureaucratic constraints and to the overwhelming direction of over-regulation. In short, said Sobolewski, the Brexit impact is very diverse and not always negative.

Trade on the Bucharest Stock Exchange (BVB) opened Friday on a falling trend, with the BET index, reflecting the developments in the 10 most liquid stocks, dropping 6.12 percent, about 15 minutes into the trading session. Around noon, the BET index bounced back to a slightly over 3 percent decline.


Leader of Romanians in UK Irimie: Brexit – a shocking decision that will affect all Romanians there


The UK’s recent vote in favour of leaving the European Union, known as Brexit, is a shocking decision that will affect all Romanians living in the UK, but the UK’s exit is a process that will take time to conduct, leader of the Romanian community in the UK Cristina Irimie told a meeting of the Congress of Romanians Abroad going on in Bucharest Friday and Saturday.

“This is a shocking decision that will affect us all who we are there,” said Irimie.

In her opinion, UK’s leaving the EU will take some time to complete and the Romanians there will be able to legalise their status in the meantime. “What I can tell you is that the UK exiting the European Union will take time to complete, and there will be enough time for Romanians residing in the UK to legalise their status,” she said.

“No Romanian national working legally in the UK will be affected, because their rights will continue to exist even after the UK’s exiting the European Union.”

“I believe we should display calm, to act English instead of Romanian, that is to seek solutions (…) Now is the time for us to prove that we are responsible, to unite and persevere in being informed,” she said.

In its direct negotiations with the UK, says Irimie, Romania will need “diplomacy, lobbying, as well as clear and pertinent messages.”

“We have to think that the UK extremists will use this moment to the max and that we, the Romanians in the UK, will become again their scapegoat,” said Irimie. Given the circumstances, she said, Romanians had two years to enjoy equal rights in the UK labour market.

Irimie added that according to the social security numbers issued in the UK the local Romanian community should be between 400,000 and 500,000.

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