News & Analysis

Emerging Europe this week

Central Europe

Romania-based Black Sea Oil and Gas will begin extracting natural gas from its 600 million US dollars offshore Romanian project in November, its chief executive Mark Beacom said on Tuesday, but added further progress hinged on scrapping a disputed tax. The additional tax on offshore projects is the last remnant of a series of price caps, taxes and export restrictions introduced two years ago by a previous centre-left government. The changes, most of which have since been reversed, blindsided gas producers, which have spent over a decade and billions of dollars preparing to tap Romania’s Black Sea gas.

Romanian automobile producer Dacia meanwhile, part of the French group Renault, saw a 13 per cent increase in sales for its Sandero model in January, compared to the same month in 2020, making it the third-best-selling car in Europe. The performance was supported by the launch of a new version of the car and other brands, such as Volkswagen, performing well below average. The Volkswagen Golf was only fourth in the top of the best-selling cars in January. The Toyota Yaris was the best-selling model in Europe last month, followed by the Peugeot 208.

The European Commission this approved a Czech scheme worth around 115 million euros to support retail businesses and service companies which are using rented premises and whose activities were limited or not allowed to be carried out in the context of the coronavirus outbreak. The scheme was approved under the State aid Temporary Framework. The public support, which will take the form of direct grants, will cover 50 per cent of the original rent due for the months of October, November, and December 2020.

Deutsche Telekom’s Slovak Telekom business cannot avoid sanctions imposed by Slovak antitrust authorities even though it has already been penalised by EU competition enforcers, the EU’s top court ruled on Thursday. The case came before the Luxembourg-based Court of Justice of the European Union after Slovak Telekom questioned the legality of the Slovak watchdog’s 17.45-million euros fine levied in 2009 as a result of the company using below-cost prices to squeeze out competitors. The European Commission in 2014 fined the company for squeezing competitors by charging unfair wholesale prices in Slovakia, which followed an investigation that began in 2009.

The advocate general for European Union’s highest court on Thursday urged the court to rule that Hungary violated the bloc’s laws on asylum when it passed legislation narrowing the possibilities for asylum-seekers to receive international protection. The non-binding opinion from the European Court of Justice’s Advocate General, Athanasios Rantos, states that the 2018 amendments to Hungary’s asylum laws – which prohibited asylum-seekers who passed through safe countries en route to Hungary from receiving international protection – violated EU law. Opinions by advocates general are often but not always followed by the European Court of Justice, which will make a final ruling on the case at a later date.

In an effort to boost vaccination rates among a skeptical public, Bulgaria has opened up Covid-19 inoculations to all who want them. Bulgarian Prime Minister Boiko Borissov told the nation this week he was creating “green corridors” where any Bulgarian resident could line up for the vaccine. Bulgaria first began administering the shots on December 27, but has since had one of the lowest vaccination rates in Europe, with fewer than one per cent of Bulgarians having taken the first dose.

The European Commission this week said it will refer Slovenia to the European Court of Justice for failure to comply with the requirements of the Urban Waste Water Treatment Directive. According to the Commission, Slovenia should have been fully compliant with the Urban Waste Water Treatment Directive requirements since 2016. However, four agglomerations with a population of over 10,000 people (Ljubljana, Trbovlje, Kočevje, and Loka) do not comply with such requirements because urban waste water entering collecting systems is not subject to the appropriate level of treatment before being discharged.

A Polish historian resigned Monday from the government’s historical institute after controversy erupted over his past ties with a far-right organisation and photos of him making the stiff-armed fascist salute. Tomasz Greniuch was recently appointed to head the Wrocław office of the Institute of National Remembrance (IPN), a state organisation whose role is to document Nazi and communist crimes carried out on Polish soil. Greniuch also authored a book, The Way of the Nationalist, published in 2013, which glorifies Léon Degrelle, a Belgian collaborator of the Third Reich, according to the Gazeta Wyborcza newspaper.


Eastern Europe

Armenian Prime Minister Nikol Pashinyan warned of an attempted military coup against him on Thursday and called on his supporters to rally in the capital after the army demanded he and his government resign. Pashinyan has faced calls to quit since November after what critics said was his disastrous handling of a six-week conflict between Azerbaijan and ethnic Armenian forces over the Nagorno-Karabakh enclave and surrounding areas.

Ukraine on Wednesday finally launched a nationwide campaign to inoculate its population against the coronavirus, following delays that sparked anger against the government in one of Europe’s poorest countries. Ukraine has so far struggled to keep up with other European countries in sourcing vaccines. Ukraine received 500,000 doses of the AstraZeneca/Oxford vaccine on Tuesday, marketed under the name Covishield and produced at the Serum Institute in India.”We have vaccinated the first doctor,” Oleksandr Skichko, governor of the central Cherkasy region, announced at a news conference as the programme kicked off in seven of Ukraine’s 25 regions.

Moldova’s political crisis deepened on February 23 when the country’s top court ruled that the president, Maia Sandu, had acted unconstitutionally by twice nominating Natalia Gavriliță, a former finance minister, to be the country’s next prime minister. The court said in its reasoning that Sandu should have accepted a proposal from 54 MPs (primarily from the Socialist party; PSRM) to instead nominate Mariana Durleșteanu, a former Moldovan ambassador to the UK. Sandu has twice nominated Gavriliță, who has little hope of forming a government that would gain the support of a majority of Moldova’s 101 MPs, in order to force an early election. Sandu can dissolve parliament if it twice fails to approve a new executive.

A Belarusian man who was shot dead by an army officer at a protest rally in August last year has been posthumously found guilty by a court of disobeying a police order. Brest regional court Judge Svyatlana Kramyaneuskaya handed down the ruling on February 25, adding that she would not sentence Henadz Shutau because he was dead. She also found a co-defendant guilty of resisting law enforcement and the attempted murder of a law enforcement officer, sentencing Alyaksandr Kardzyukou to 10 years in prison.

North East Europe

The number of foreign tourists visiting Estonia in 2020 fell to its lowest level in 20 years, the Estonian Tourist Board said this week. While in the first two months of last year the tourism sector hit new records, the onset of the Covid-19 pandemic pushed the figures downwards, ending in an annual fall of nearly 50 per cent in the number of tourists and overnight stays. The number of foreigners who spent at least one night in the country was just 1.4 million. “The world stayed at home, and the same thing happened in Estonia,” said Liina Maria Lepik, director of the Estonian Tourist Board.

One of the most influential figures in Latvian politics has been sentenced to five years in prison for corruption. Aivars Lembergs, the mayor of the city of Ventspils since 1988, was convicted by a court in Riga on Monday of bribery and money laundering. The wealthy businessman was immediately arrested after the sentence and fined an additional 20,000 euros. The court ruled that he must pay damages against several individuals and former business rivals, and confiscated a number of Lembergs’ assets, which are believed to amount to several million euros. Lembergs – who denied the charges – intends to appeal the decision, describing the trial as a “political reckoning”.

Lithuania-based Affise, a marketing platform for building business partnerships, has raised eight million US dollars (around 6.5 million euros) in Series A funding. The round was led by Leta Capital with the participation of TMT Investments. The capital will enable the company to expand its product suite to increase its presence in North America, Latin America, and South East Asia, as well as cement its position in Europe, Israel, and India.


South East Europe

A Serbian court has sentenced a former mayor to four years in prison for ordering an arson attack on the home of an investigative journalist. In a trial that lasted nearly two years, a court on Tuesday found Dragoljub Simonovic guilty of ordering the December 2018 attack on Milan Jovanovic, a reporter for the news website Zig Info. Simonovic, a member of the ruling Serbian Progressive party, was mayor of Grocka, a municipality near the capital, Belgrade, at the time of the attack. “I hope that this verdict will be the harbinger of more media freedom in Serbia,” Jovanovic told reporters outside the court, adding that he was satisfied with the ruling.

Environmental activists in Bosnia and Herzegovina are warning that tons of garbage floating down the Balkan country’s rivers are endangering the local ecosystem and people’s health. The Drina river, located on the border between Bosnia and Serbia, has been covered for weeks with trash that has piled up faster than the authorities can clear it out. “This is a problem of huge proportions,” warned Dejan Furtula of the local environmental group Eko Centar Visegrad. “I am appealing on all institutions and everyone who can help to join the (clearing) process.”

The US State Department announced on Tuesday that Adrian Dvorani, a former High Court judge in Albania, has been named on its list of 12 people around the world who have distinguished themselves by fighting corruption. “Judge Dvorani developed mechanisms to reduce political and criminal influence in the justice system, steps that contributed to the EU’s decision in March to open negotiations for Albania’s accession,” the State Department said in a statement.

International and local Kosovo press associations have condemned an attack against an investigative journalist who was brutally beaten near his house in Fushe Kosove/Kosovo Polje, at around midnight on Wednesday. Visar Duriqi, a journalist of the local Kosovo online news portal Insajderi as well as the author and producer of local show INDOKS, was assaulted by three unidentified individuals at around midnight after a TV debate. Duriqi has authored several episodes on crime and corruption on Insajderi’s show, INDOKS. Police are investigating the case.

A proposal by a small but key party in North Macedonia’s ruling coalition to introduce an ethnicity field in the ID card carried by each and every citizen has won almost universal political approval in the country, despite warnings that the move threatens to deepen ethnic divisions and encourage discrimination. North Macedonia boasts a number of ethnic minorities, the biggest of which is the Albanian minority living mainly in the north and west and which accounts for at least 25 per cent of the country’s two million people. The motion to give people the right to include their ethnicity in their ID cards was put forward in February by the ethnic Albanian BESA party, which is part of the coalition government led by the Social Democrats.


Central Asia

New analysis of 90-million-year-old dinosaur remains has revealed a first-of-its-kind sauropod from Uzbekistan. Researchers found that a single tail vertebra, discovered in 1997, belonged to a dinosaur similar to diplodocus they have now dubbed Dzharatitanis kingi, according to research published on Wednesday. The fossil is the first in a subclass of sauropod dinosaurs, called rebbachisaurids, to come from Asia: It turned up in Dzharakuduk, Uzbekistan, in the Upper Cretaceous Bissekty Formation.

Fitch Ratings this week affirmed Kazakhstan’s Long-Term Foreign-Currency Issuer Default Rating (IDR) at ‘BBB’ with a Stable Outlook. According to Fitch, Kazakhstan’s ‘BBB’ IDRs balance strong fiscal and external balance sheets underpinned by accumulated oil fiscal revenues, against a high dependence on commodities and lower, but improving, governance scores relative to ‘BBB’ rated peers. Government indebtedness remains low and external and fiscal buffers have been resilient to the coronavirus and oil price shocks.

In addition to 8.63 million US dollars approved for Covid-19 vaccines, the World Bank this week announced a further 12.57 million US dollars in grant financing for the Tajikistan Emergency Covid-19 Project, to further strengthen Tajikistan’s heath care capacity and protect vulnerable population groups in response to the Covid-19 pandemic. “These additional resources will further help Tajikistan to protect the poorest households from the direct impacts of the pandemic, by strengthening the healthcare system and emergency social assistance,” said Jan-Peter Olters, World Bank country manager for Tajikistan. “This project – complementing efforts to secure Covid-19 vaccines – aims at providing necessary support to allow for accelerated economic recovery and the ability to help the country’s most vulnerable households.”


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