Bucharest joins the crisis cell with world leaders

“The Romanian banking system is solid, and all banks in Romania are in a good situation. We must be prudent and responsible, as we have a chance to be minimally affected by the financial crisis. The Romanian stock exchange makes up a mere 5 percent of the national economy, and only an emotional outcry by politicians and irresponsible measures on their part could unsettle the economic balance,” said Basescu on Friday.

Nevertheless, major local market players are beginning to take precautionary measures. ArcelorMittal Galati, the largest Romanian asset of the world’s biggest steelmaker, ArcelorMittal, announced it would reduce production of finished products due to the international economic crisis. Similarly, Teodor Atanasiu, President of the Authority for State Assets Recovery (AVAS), said it is unlikely that the privatization of Antibiotice Iasi drug maker will be relaunched in the near future, also due to the international crisis.

“As a result of the international financial crisis, we are witnessing a drop in demand for steel products. This directly affects the operational and financial performances of all steelmakers, including ArcelorMittal Galati. As is the case with other producers, we must now reduce the production of certain goods to avoid an increase in stocks,” said ArcelorMittal Galati officials.

The Indian owner of ArcelorMittal, Lakshmi Mittal, lost $27 billion of his fortune as a result of the crisis. Another four of the world’s richest people, Roman Abramovici, Oleg Deripaska, Carlos Slim Helu, and Bill Gates, posted losses of between $1.5 and $20 billion, while the cumulated riches of Russian oligarchs dropped by $230 billion in this same period.

Yesterday, Euro zone heads of state and governments decided that states must intervene to support national banking systems with a measure to include subvention for banks, deposit guarantees, and stimuli for interbank loans.