Prime Minister Ilie Bolojan announced that the emergency ordinance regarding the declaration of a crisis situation on the fuel market is expected to be adopted by the Government on Wednesday afternoon or Thursday.
Thus, on Wednesday at 11:00, the meeting of the National Tripartite Council for Social Dialogue will take place, with the participation of representatives of the Government, trade unions and employers' organisations. From 12:30, the plenary session of the Economic and Social Council (CES) is expected to be held, PM Bolojan told Euronews on Tuesday.
"Against the backdrop of discussions regarding fuel prices, we prepared this first draft ordinance and today, the CES, which is a body that must approve this type of draft, postponed its decision - they must give an opinion, whether favourable or unfavourable - requesting that we hold a meeting in a Tripartite Council, in which the employers' organisations will also participate," Bolojan said.
The Prime Minister mentioned that the Government ensured, through the dialogue with major gas networks in Romania, that the price increase "do not go directly into Romanians' pockets," but are "much slower." On the other hand, Bolojan underscored that a price increase cannot be stopped, in the context in which 70% of the crude oil and diesel used in Romania comes form imports.
"These blockages in the Gulf related to the transport of crude oil and diesel from the respective area to all countries around the world have a global impact which we cannot avoid," he said.
PM Bolojan mentioned that the capping of commercial margins is manageable for the economic operators in the fuel sector with integrated refining and distribution activities. In contrast, it affects more strongly the economic operators which purchase finished products for resale. The discussions on Wednesday with the main fuel operators will also address these aspects.
"Where there are only traders who buy the finished product directly - diesel, for example, which they import and then distribute - their profit margin is not very high. And halving this margin could - these were the concerns raised during this period - put them in a situation where they cannot cover their costs, and thus operate at a loss. In such a scenario, the market effect would be a halt in supply, which could lead certain petrol stations, not those in the major networks, but the relatively independent ones, to experience fuel shortages," the Prime Minister explained.
PM Bolojan also explained that "no extra money" collected this month in the form of VAT, as a result of price increases, "will remain in the moneybox" of the Romanian state. In this regard, he rejected the idea that the Government could intervene, but chooses not, in order to collect "a large amount" of taxes.
"One of the principles we have followed in assessing what can be done on this market is that the cost should be shared, because inevitably, whatever we do, no state can keep prices at a level unaffected by what is happening in the Gulf. That is a certain thing. However, it is clear that the citizens will pay a price, the state will pay a price for everything it collects additionally. Moreover, distributors or large producers, some of whom may make extra profits during this period, must also pay a price," Ilie Bolojan said.
He mentioned that the scenario of reducing VAT on fuels and the excise duty "is on the table." Towards the end of March, the Government could consider "other intervention measures," but only after prices reach a certain level of stabilisation.
"The scenario of reducing VAT is on the table, it is a second step, but that means reaching a situation of stability, seeing how much has been collected and estimate what the other costs would be, because, once you enter this type of mechanism, even if you can intervene, let's say, month by month, you trigger additional costs. And Romania does not currently have a 3% deficit, which would have been preferable. (...) We are creating a framework for monitoring, ensuring transparency of expenditures so that, toward the end of March, we can take into account other intervention measures, but only after we see that the price has reached a certain level of stabilization and things are balanced. Otherwise, if we intervened too early, there would be no effect at all," Prime Minister Ilie Bolojan mentioned.
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