According to the European Commission, Romania is forecast to advance by 2.5% this year in terms of GDP, one of the most significant growths in the European space. The estimation was offered in the Winter 2023 Economic Forecast, where Romania is among the countries to avoid recession this year.

A story from Manchester defines the economic opportunities Romania has to offer. It also shows how the global economy makes it possible for Romania’s opportunities to impact jobs in the UK. The Machester Evening News, the famous Manchester publication, says that in Sale, one of the towns in Greater Manchester, one big company, Verastar, decided to externalize a whole department to Ascensos. Reportedly, 60 employees were told to relocate to Bucharest, Romania, or lose their jobs. As simple as that.

The management announced to their employees by e-mail that they would move to Bucharest, an unlikely scenario, as they admit it or lose their jobs. Reportedly, the salaries at Verastar Sale reached 27,000 British pounds a year, which means EUR 2,530 a month.

We believe that Ascensos will be able to assist us in meeting those economic challenges. Ascensos will therefore announce that one of their measures will be a relocation to Bucharest in Romania which we feel is the right option due to their location having a wider resource pool, solid infrastructure and technology, which will deliver greater efficiency. We do acknowledge that the work is being moved offshore and, therefore will be seeking clarification from you as to whether you wish to transfer. This may seem obvious since colleagues would unlikely wish to transfer overseas, but it is a legal requirement that we ask. Those who do not wish to transfer would, unfortunately, be placed at risk of redundancy by Ascensos.

E-mail to Veristar employees in Sale, Greater Manchester

The lesson here is pure economics: why pay 60 employees in Manchester EUR 2,500 a month, meaning EUR 150,000, when you can drastically reduce costs with salaries and employ only 30 people in Bucharest with EUR 1,000 or even less a month to do the same job? You have a massive cut of EUR 120,000 a month of your expenses while externalizing the work.

Globalization means business, and this means that employees in the UK might lose their jobs to the benefit of Eastern countries, such as Romania. Globalization doesn’t care about families, friends or life stories, it only means business – the higher the cut of the salaries, the higher the profit.

Fortunately for Bucharest, the city has all that matters to welcome businesses from abroad. Apart from the famous internet speed, Bucharest is one of the European cities where they speak English at a conversational or proficient level. Besides, the salaries in Romania are way lower than in Western countries, thus making it a destination for business relocation.

Doing business in Bucharest seems more profitable than ever, and companies have chosen the city for its opportunities. A crisis in the UK means business in Romania, which is the sad reality of the current economic context.

As usual, we recommend our readers, British or from elsewhere, to visit Bucharest. It would be an opportunity to see the city’s potential and the famous Bucharest attractions that make more than 1 million international tourists visit Romania’s capital each year.

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Eastern Europe is feeling the effects of the Ukrainian conflict as inflation and high-interest rates take a heavy toll, and economies stagnate. Although Poland and Romania seem to cope with it, a recession has been announced by experts to come.

After an incredible growth at the start of the year, the economies of Eastern Europe are already showing signs of instability due to the war. Bloomberg reports that among the few nations that have maintained their growth are Romania and Poland.

Bloomberg analysts predict a steep decrease for Hungary, while the economies of Poland and Romania are anticipated to slow down in the upcoming quarter.

Forecasts show that the area is gradually approaching a recession, which may occur in the second part of 2022. The major issues facing Eastern Europe are inflation, the energy crisis exacerbated by Russia’s erratic supply, and drought, which could impact the region’s agriculture.

Hungary is facing the worst-case scenario, where it is impossible to avoid a quarterly decline. Viktor Orban put into place several populist policies to win the elections in April, which would eventually impact the nation’s economy. The Czech Republic unexpectedly avoided a quarterly contraction when it announced GDP figures at the end of July. The Czech Republic’s GDP increased by 0.2% from the previous quarter and 3.6% in the prior year.

However, challenges for Eastern Europeans started to multiply. Interest rates reached their highest point since the 2008 financial crisis, and electricity prices set a new record. The optimism drops dramatically when the recession seems to be postponed rather than prevented.

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In a recent New York Times column, Paul Krugman compared the cryptocurrency craze to the mid-2000s housing bubble. He warned that digital coins’ hype was similar to people’s unwavering faith in the US housing market before it crashed, resulting in a global financial crisis.

Only a few investors, including Michael Burry of “The Big Short” fame and John Paulson, recognized that house prices had reached unsustainable levels and had the courage and conviction to bet against ostensibly safe mortgage-backed securities.

Krugman, who won the Nobel Prize in economics in 2008, attributed the widespread delusion to the “incredulity factor.”

Krugman asserted that the crypto market peaked at nearly $3 trillion in November and is a similar story. He emphasized bitcoin’s lack of practical applications, questioned how tokens are superior to traditional payment methods and highlighted crypto’s popularity among fraudsters and money launderers.

The Nobel laureate observed that, as with the housing boom, it appears absurd to question an asset class that has become valuable and attracted many influential promoters. He said crypto is “a house built not on sand, but nothing at all.“

Crypto has become so valuable and popular that people wrongly assume it’s worth something.

Paul Krugman

In terms of identifying Michael Burry, he warned about the state of the US economy, demonstrating that Americans’ savings have collapsed since the spring of 2021, a situation he blames on spending to keep up with inflation.

Paul Krugman’s warning isn’t the only one that should deter crypto enthusiasts from investing in digital coins. EU supervisory organizations have cautioned that consumers risk losing all of their money invested in cryptocurrencies.

Due to the instability of the crypto market, the pressures from the regulators and the increasing prices, crypto users should recalculate their finances during this period.

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Although it seems complicated, getting through an economic crisis without significant losses is not tricky. Or, better said, it is easier than you think at first sight.

An economic crisis can be likened to a two-sided coin. It has both negative and good parts, and if you think smart, you will get through the difficult financial period.

Think about the economic crisis as a necessity. For the economy to grow, such “declines” are needed in the economic scheme. Many find new growth opportunities in such situations, and we are not talking here about the crooks or any Ponzi method. But your financial situation may change depending on your perspective and how much you can change it in your favour.

Therefore to find the solution, you have to identify the problem.

What is an economic crisis?

An economic crisis directly impacts all economic activities in a country.

High-interest rates, a drop in consumer spending, a high unemployment rate, and a financial crisis are all variables that contribute to an economic crisis.
An economic crisis occurs when a country’s economy takes a sharp downturn due to various factors that directly impact all economic sectors. However, an economic crisis affects all economic stakeholders and provides a clear picture of financial performance in the long run.

The 2008 Global Financial Crisis was arguably the most significant financial followed by an economic crisis in the last 90 years.

Anyone can be kept awake at night by being hit by a significant adverse event that could damage their income, such as a job loss, illness, a vehicle accident — or a pandemic. Especially for an entrepreneur, an economic crisis could be an absolute nightmare threatening the future of his business. However, serious documentation regarding how to survive a financial crisis as an entrepreneur might be helpful.

However, if you’re well-prepared, the danger of something costly and out of your control becomes less frightening.

Here is how to survive an economic crisis:

1. Be prepared: save money ahead

It’s best to lay away money for a couple of months or even more because even a modest amount will come in handy when you’re in a pinch. These funds will assure you that you will be able to go through a catastrophe. An interest-bearing savings account, which you can access promptly, is the most excellent place to keep your money.

2. Be prudent: control your expenses

Keep a close eye on everything you buy and make minor adjustments if necessary. The most crucial thing to consider is what you can do to improve your condition at a minimum cost. There are many ways to shop. For example, most people spend a significant amount of their income buying food. Of course, you can’t give up eating, but you can give up buying food from supermarkets that sell food at a high price. Instead, try doing your grocery shopping at local markets. In this way, you help small farmers and save some money. Another way of controlling your expenses is to take care of your health. You avoid getting sick and paying for doctor’s visits or medicines by taking extra care of your health.

3. Cut off extra costs: minimise your monthly bills

You may not need to do it right away, but be prepared to start cutting out everything that isn’t necessary. When money is tight, you’ll have less trouble paying your bills if you reduce your recurrent monthly spending as low as possible. Begin by reviewing your budget to determine where you are currently spending more money than is necessary. Maybe you’re letting the heater or air conditioner run when you’re not home, setting a higher than the needed temperature, or leaving lights on in rooms you aren’t using. You may be able to trim your utility bills. Another good example is to start using public transport more frequently or, if possible, start walking on foot for short destinations.

4. Look for ways to earn extra money

Activities like selling items online you no longer use, babysitting or finding a second job represent good options for making extra money. Although the money you receive from these activities may appear modest compared to what you earn from your main work, even small amounts might add to something important over time. Furthermore, several of these activities offer additional advantages: You might find that you appreciate your side work enough to make it your full-time job, or you might find that you enjoy it enough to make it your profession.

5. Give up expensive habits

Activities like gym, spa treatment, salons and so on are extreme. In times of crisis, you should try to cut any extra costs that make your budget difficult. Going outside for sports activities or painting your nails are some of the habits that require zero budget. Trying not to buy items from the fast-changing fashion trends might save you a considerable amount of money. Creating a budget is a better solution in times of financial crisis. Many people are buying emotionally, out of desire and not out of necessity, so creating a budget might be a factor that can make you cut the unnecessary expenses.

Instead of conclusion

Life is unpredictable, but being prepared and cautious can help you avoid calamity. With the correct planning, some minor changes in lifestyle and reducing unnecessary expenses, a potential economic disaster might be reduced to a minor setback.

Of course, if you are an entrepreneur, you should take some different measures at hand. In this case, we advise you to consult our “How to survive the crisis as an entrepreneur“. It might come in handy in the months ahead.

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From those 11 ships, 5 are in the Aegean Sea, while 6 are in the Mediterranean Sea.

There is an option for the 5 ships blocked in the Aegean to return to Port of Midia, as the ships are only 4-5 days away. This would be the best option for the livestock transported such as for a tragedy to be avoided.

The local authorities and the international aid try to solve the blockage caused by the Japanese cargo which ran ashore. According to Lloyd’s, the blockage costs $400 million an hour. More precisely, the insurance company values the canal’s westbound traffic at roughly $5.1 billion a day, and eastbound traffic at around $4.5 billion a day.

Romanian National Sanitary Veterinary and Food Safety Authority set up a crisis cell on Saturday to monitor the situation and find the best solutions possible for the livestock and the personnel from the Romanian ships.

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One of them was for Yahoo! Finance, where Roubini offered its first gloomy prediction: a global recession doesn’t look too far fetched. Also, he added:

I think the market reaction right now is quite severe, and it’s going to be more severe than SARS for many reasons

Nouriel Roubini for On The Move, Yaho! Finance

For those who try and compare the SARS effects and Coronavirus effects on global economy, Roubini offered a clear picture: during SARS, the precedent deadly virus, China’s economy accounted for only 4% of the global economy. At present, China accounts for 20% of the GDP. Also, the number of SARS infected people all over the world reached only 8,000 cases, with around 700 deaths. Now, the Coronavirus surpassed the 100,000 infected and 3,000 deaths all over the world.

Also, in an interview for Der Spiegel, Dr Doom predicted the stocks will fall 30-40% in 2020 because of the Coronavirus. He advised the investors to hold cash and government bonds. ‘Better safe than sorry’, as he said.

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