The Liberals’ Economic Recovery Plan: Grants and aid schemes, 3 regional hospitals, thousands of km of highways

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The Government is releasing the National Plan of Investments and Economic Recovery within an event due this evening at 18:00hrs, with President Klaus Iohannis attending. According to the document quoted by Digi24, the Liberal Government vows to change the existing development pattern based on consumption into an economic pattern based on investments, digitalization and stimulation of the domestic capital.

80% of the recovery plan, worth over EUR 100 billion, would be invested in transport and energy infrastructure, as well as in healthcare and education.

PM Ludovic Orban has told the government sitting that the Recovery Plan will change Romania’s growth strategy and will change the vision on the way Romania should develop and modernize. The PM asked ministers to draft all regulatory documents needed to enforce the Plan by the end of this week, so that they could be approved in a month.

 

The aim of the new economic development plan proposed by the Ludovic Orban Cabinet is to achieve convergence with the European economies so that the Gross Domestic Product per capita to reach 87% of the EU average in the next 5 years.

The Government expects Romania’s GDP to cut by 1.9% this year, yet stressing that a pandemic comeback will affect the growth perspectives and will cause significant damage to the companies and jobs.

The document foresees several measures to support the SMEs, as well as grants and non-refundable funds, aid schemes, the establishment of a National Development Bank as credit institution for the investment projects, as well as the establishment of the Romanian Development Fund.

There are also social protection measures entailed, such as vouchers for hot meals for the elderly, vouchers for children from the low-income families, packages for vulnerable people.

In terms of investments, the Government pledges to build three regional hospital in Cluj, Iasi and Craiova until 2027, connecting all Romania’s historical regions through motorways by launching around 3,000 kilomoters of highways and express roads till 2030, to start construction works on the metro line in Cluj and to conclude the subway line connecting Bucharest with the Otopeni Airport.

The Executive also promises to rehabilitate and revamp 20,000km of local roads and 7,000 of county roads, to extend the sewerage and water networks and to build a Siret-Baragan Channel.

The money would come both from the state budget, as well as from European money. The European Commission proposed EUR 33 billion for Romania for the recovery plan to cope with the coronavirus pandemic effects, and almost EUR 80 billion through the 2021-2017 budget allotments.

The grants to support SMEs restart activity, for their working capital and investments mount to around EUR 1.034 billion. The non-refundable financing programmes for the increase of SMEs competitiveness stand at EUR 1.13 bln.

The state aid scheme for greenfield investments and for investments promoting the regional development has EUR 1,47 billion allotted.

The grants for the innovative entrepreneurial initiatives and for digitalization are worth EUR 330 million. The aid for agriculture mounts to EUR 368 M.

The construction of the three regional hospitals during 2021-2027 would need EUR 1.64 billion.

For the National Energy System investments worth EUR 12.48 billion are envisaged during 2020-2025.

Concluding the current highways under construction has an estimated cost of EUR 4.3 billion, while connecting the historical regions through motorways would need EUR 31 billion.

The Orban Gov’t in Bucharest also vows to build 12 sports centers, 8 olympic pools (EUR 1 bln) and 5 man-made skating rinks for competitions, as well as 5 polyvalent halls. Other sports-related project included 250 new school gyms, 45 school pools, 400 sports centers.

Ciolacu: The recovery plan is stolen from the PSD ruling programme

PSD interim chairman, Marcel Ciolacu, has retorted that great part of the Orban Government’s Recovery Plan is copied from the Social Democrats’ ruling programme. “Ironically,  certain excerpts that PSD has already achieved are also copied”, he argued, reiterating that PSD will file a censure motion, without yet mentioning when it’s going to happen.
USR: “A salad of schemes”
USR deputy Claudiu Năsui has also commented the Government’s recovery plan, saying “it is a salad full of subsidy schemes from the taxpayers’ money, combined with an eternal re-heated soup of so-called investments on the eve of elections”.
“It’s really sad to look over the recovery plan proposed by PNL“, Nasui said, adding that it is resuming Dragnea’s and Vlacov’s ‘failed idea” of a sovereign investment fund.
“The real Romanian business environment, meaning the one that is not branched to public money, will benefit of nothing“, the USR lawmaker further commented.

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