WEAK LEU DOES NOT HELP EXPORTERS Pain with no cure

Euro is on a roll against the leu, reaching a new record high of 4,3127 lei yesterday. The leu has lost another battle against the Euro yesterday, and the consequences are being felt by the national economy and they are affecting everyone"s daily life.

In this context, the National Bank of Romania (BNR), through Adrian Vasilescu, the counselor of Mugur Isărescu, issued a statement saying that the high reached by the Euro against the leu means "pain" for importers and for citizens who have foreign currency loans to pay back.

Vasilescu said that exporters aren"t doing so well either, even though the high reached by the European currency, would mean, in his opinion, "a slight relief" for exporters. "Some of the more competitive Romanian companies will reduce their exports because of the drop in demand", Mr. Vasilescu added.

Between the "slight relief" mentioned by the Counselor of the NBR and the drop in demand for good companies, the equation is missing the effects of the economic and financial crisis, which does not discriminate against companies. Nor against borrowers, who are in for a lot of pain, as Mr. Vasilescu put it.

Had there been more financial stability at an international level, a strong Euro could mean a slight relief for exporters. But not under the current conditions, where there is no glass half full, even for exporters.

Exporters say that the current exchange rate and the current tendency of the leu to depreciate against the Euro only represents the result of the current conditions of crisis.

The Secretary General of the National Association of Exporters and Importers of Romania (ANEIR), Mihai Ionescu, says that the current exchange rate is "artificial", and it does not bring any benefits to the exporters, but rather only to speculative funds.

Mihai Ionescu explained: "This exchange rate would have been favorable and useful to exporters in normal times. In times of crisis, the weak leu is not favorable to us, because of the drop in orders and earnings. In the first 10 days of January, orders from countries outside the European Community, dropped 46% against the similar period of last year".

ANEIR requested yesterday that the NBR intervene on the market in order to slow down the depreciation of the leu against the Euro.

Exporters claim that the current exchange rate is the result of acts of speculative funds, which are the only winners in the current situation.

Mihai Ionescu said that a normal exchange rate would be 3,6-3,8 lei for one Euro.

Discussing importers, the ANEIR representative mentioned that the appreciation of the Euro has also caused a drop in imports. The General Secretary of The Businessmen"s Association of Romania (AOAR), Cristian Pârvan, added that the drop in imports will be felt first of all, in the pharmaceutical sector.

There goes the "remedy" for the "pain" that Adrian Vasilescu was talking about...