Covid-19 matrix, discussed during a meeting with the group of experts of the Economic Council

3 November 2020  – Prime Minister Ion Chicu today chaired a meeting with the experts of the Economic Council’s secretariat. The participants in the event presented findings of a study of impact of the pandemic on the economic sectors, the government’s communication and protocol department has reported.

The document was elaborated based on the consultation of over 20 representatives from diverse economic sectors, as well as public authorities. The COVID-19 matrix pointed out the problems specific to the national economy’s sectors and also comes up with preliminary measures of overcoming the crisis.

According to official statistics, the overwhelming majority of the sectors face a decrease in sales, counteracted by reducing staff, postponing investments, decrease in budgets for marketing and promotion.

The matrix implies three types of actions needed to be implemented, in order to back an economic balance. The first measure sees the optimization of the normative framework, which includes 14 measures with major economic impact and which will bring about 57.5 million lei to the budget.

Thus, decision-makers are set to digitalize the economy, simplify the authorizations in constructions, export certificates, etc.

The second measure provides for adjustings to the taxation regime. Experts included here proposals which regard the elimination of distortions from the value chain in agriculture, reducing the shadow economy, facilities in young people’s employment.

The last string deals with economic stimuli and comprises 17 measures. They regard the offering of a larger volume of state guarantees, boosting the First Home programme, agricultural subsidies, irrigation systems, etc.

The PM said that the cabinet did its utmost to come up with measures of supporting economic agents where there is urgent need, as well as with diverse social measures, investments in infrastructure and providing opportunities to young people.

„We want to encourage the employment of young people, including those who return from the Diaspora. In this respect, we will further maintain the mechanism of subsidization for the sectors worst hit by the pandemic. If the person gets employed, the economic agent receives from the state budget 50 per cent of the payments related to the salary for each employee in next 12 months. In the case of employment of disabled people, 100 per cent is subsidized from the state budget,’’ the prime minister said.

Ion Chicu appreciated the work of economic experts and asked to continue discussions with concerned institutions on the measures provided for in the document. ‘’Thank you for the huge support you provided through the working out of this study. We must do so that a good deal of these proposals be materialized and implemented. We should find a middle way, which would ensure the budgetary balance, as well as the economic one,’’ the prime minister said.

The PM also said that some of the already accepted proposals would be included in the fiscal and budgetary policy for 2021.

The study of impact of the COVID-19 pandemic is carried out by the Economic Council jointly with the Economics and Infrastructure Ministry, with the support of the European Bank for Reconstruction and Development, UK Government’s Good Governance Fund and the International Finance Corporation.

The Secretariat of the Economic Council to the Prime Minister is supported by the European Bank for Reconstruction and Development, funded by the UK Government’s Good Governance Fund, and the International Finance Corporation’s Investment Climate Reform Project funded by the Government of Sweden’s International Development Agency.

Stay ahead in a rapidly world. Subscribe to Prysm Insights,our monthly look at the critical issues facing global business.