Lower Chamber passes draft bill on gold reserves repatriation

By Romania Journal Last updated Apr 24, 2019

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The Chamber of Deputies (Romanian Parliament’s lower chamber) has passed today the draft law initiated by Liviu Dragnea and Serban Nicolae, saying that the National Bank of Romania must repatriate 91.5% of the Romanian gold reserves stored abroad. The National Liberal Party (PNL) has announced it will refer the law to the Constitutional Court.

The draft bill is amending the law 312/2004 on the BNR Regulations and it has passed by 165 votes in favour and 90 against, and three abstentions.

The BNR officials have opposed the draft law since its initiation, yet the ruling party’s chairman Liviu Dragnea has said today that he has never heard BNR governor Mugur Isarescu challenging the bill.

“I’ve never heard Mugur Isarescu contesting this bill. There have been many advisers within BNR who said many lies, nonsense, preaching that our ruling programme will never work in Romania, and they were wrong. When I see an official stance by BNR voiced by the central bank governor, you will ask me then. I endorse this draft law,” Dragnea argued.

On the other hand, the National Liberal Party has announced it would refer the law to the Constitutional Court.

“We are on electoral campaign this draft proves populism. You use this bill to silence voices who are slamming the amendments that you are operating now on the criminal codes”, PNL deputy Pavel Popescu told the MPs from the ruling coalition.

He argued that the gold repatriation bill might become dangerous for Romania, as “the gold stocks give the credibility to this country, and not to PSD or Teodorovici (e.n Finance minister),” the Liberal lawmaker added, saying the draft lacks the BNR’s opinion.

“Do you know which are the tree countries that repatriated their gold reserve? Venezuela, Turkey and Hungary. Judging by the political conduct that you are practicing it is perfectly rational to line up with these three countries,” Popescu concluded.

The Budget, finances and banks Committee in the Chamber of Deputies issued a favorable opinion for the draft law on April 16. The committee has also passed an amendment saying that, in crisis situations that would endanger the monetary stability, the inflation target or the macroeconomic policies, BNR must inform the Parliament and the Government in 20 days at the most.

The Senate (Romanian Parliament’s upper chamber) also Okayed the Social Democrat Party’s draft bill on the repatriation of the gold reserves three weeks ago. Senators adopted the draft bill by 60 votes to 29 and 16 abstentions, after the budget-finance committee with the Senate had previously adopted an admission report on the draft bill.

The bill has passed with an amendment file by Liberal senator Florin Cîţu, which introduced a deadline of 20 days under which BNR must present a report on the international reserves to the Government and to the Parliament, if there is a danger of these reserves being diminished. The report will also include the reasons of the international reserves’ cut and the BNR recommendation for the Executive.

Senator Florin Cîţu said the Liberals do not agree with this bill which „is directly intervening in the way the monetary policy is enforced in Romania”.

In his turn, PMP senator Traian Basescu, former President of Romania, told the Senate’s plenary session that the bill „is a huge mistake”, as, in case of crisis, “Romania will be looking for the back door to run with the gold in London in order to prove it exists.”

On the other side, one of the arguments in favor of the bill is that Romania has been keeping a great part of its gold reserves at the Bank of England for 10 years and is not getting any interests, and, on the contrary, it is paying a rent for deposit.

At present, Romania has gold reserves of almost 104 tons, with almost 60% of them being deposited in the UK.

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