Business Arena Magazine nr. 86

E n j o y

t h e

Q u a l i t y * * * * *

ARENA

A d m i r e

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V a l u e * * * * * No.86/2019

23lei

m a g a z i n e

UFUK TANDOĞAN, We are heading towards a digital-oriented banking system, but until then, we have some other challenges ahead pages 10 - 12

special section inside

LUXURY & LIFESTYLE

TOP BRAND pages 38 - 58

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CEO GARANTI BANK ROMÂNIA

EDITORIAL

by

Cristian Cojanu

ECONOMIC VULNERABILITIES SHOW THEIR UGLY FACE While analysts have identified a variety of economic threats worldwide, Romania makes no exception, as its government's economic policies have often been criticized for jeopardizing the country's macroeconomic stability.

To use some concrete examples, a release summarizing the views of the IMF's Executive Board points at increasingly obvious macroeconomic imbalances.

"With macroeconomic imbalances becoming increasingly evident, eroding buffers and undermining Romania's capacity to withstand adverse shocks, there is a risk that the income convergence with the EU could suffer a setback," the IMF noted. It added: "The key domestic risk is an increase in vulnerability caused by policy shocks, including further fiscal stimulus or regresses on structural reforms.

Externally, the key risk stems from a sharper-than-expected external slowdown, which would widen the current account deficit, magnifying financing pressures.

While Romania's moderate public debt and reserves can provide a temporary cushion, these buffers can prove insufficient under an adverse event."

In turn, CFA Romania, a professional organization bringing together investment professionals, expects economic activity in Romania to worsen in the next 12 months. In a monthly survey, CFA indicates that the index of analysts' expectations on the economic situation in Romania in the next 12 months reached 33.3 points in August, down 10.8 points from July, and 9.3 points down from August 2018. The CFA analysts also expect an exchange rate of 4.7835 lei per euro in the next six months and 4.8243 lei

per euro in the next 12 months.

Moreover, Banca Transilvania's experts have found that the main risks to Romania's economic growth are related to the global and European macro-financial climate, the economic policy mix and the public tensions in the country. In addition, inflationary pressures are expected to stay high in the short term.

Amid such macro-economic uncertainties, AmCham Romania has announced the launch of an initiative targeted at helping individuals improve their financial inclusion, which should bring more prosperity and improved life quality for the population.

Ciprian Lăduncă, member of the AmCham Romania Board of Directors and Co-Chair of the AmCham Capital Markets and Financial Services Committee, said: "While Romania has made significant progress in recent years as concerns the financial services, our country continues to rank the lowest in the EU in terms of level of financial education and access to some categories of financial goods and services, a situation even more severed by the major gap between the rural and urban areas from this perspective. We trust that this particular AmCham initiative will contribute to an increased commitment of each stakeholder - private and public alike - to reaching the shared objective of prosperity for Romanians, of transferring the economic growth into a better quality of life."

Find more opinions and predictions about domestic and global economic and geopolitical trends in this edition of Business Arena.

FROM ALL OF US HERE AT BUSINESS ARENA, ENJOY THE QUALITY, ADMIRE THE VALUE!

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OPINION

THE HIGH PRICE OF IMPOSTURE

One can hardly underestimate the implications of Mr.. D\nu] Ca[ol's sacking from his position as Transelectrica's CEO and subsequent "disappearance". There you have it: the leader of the company that runs the National Grid, upon which millions of lives depend, a company that is at the heart of the Romanian critical infrastructure, a company that is essential to insuring Romania's energy security has simply "vanished" amid allegations that he forged his university diploma.

BY OVIDIU CONSTANTINESCU, FACE PR AND NEWS

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We have this incredible fact: a house electrician (not even a good one) has run Romania's National Grid for six month before a journalist from the education site edupedu.ro exposed the imposture. How low have the state institutions fallen so that a highschool graduate and a university drop-out got to be appointed to lead of one of Romania's most important companies for its survival? It is utterly unbelievable that no one in the security community bothered to inform the decision makers that D\nu] Ca[ol's (lack of formal) education was a liability for Romania's national security. How on earth could a company that is listed on the Bucharest Stock Exchange (BVB) fail to ensure a proper examination of the formal credentials of the newly-appointed CEO and correctly inform the investors? Not a blink, not an eyeOVIDIU CONSTANTINESCU brow risen... Let's recap Mr. D\nu] Ca[ol's scrappy education and career: Born in Teleorman, D\nu] Ca[ol graduated a vocational training high-school as an electrician, in 1992. Between 1993 and 2006 he worked according to his qualifications as a field electrician changing fuses and mending cables with Electrica SA and Enel Distribu!ie Muntenia. It took him 16 years to be promoted to field team deputy-leader (wow!), a position that he held until 2016 when he moved to General Electro Proexim, a sub-contractor for Enel Distribu]ie Muntenia. From here, somehow, he managed to get parachuted as the head of the all-important Bucharest branch of Transelectrica. Then, on December 21, 2018, he was "ordained" CEO of Transelectrica. For both positions he needed a university diploma, so he literally fabricated one for himself.

More than anyone else, Mr. D\nu] Ca[ol is the embodiment of professional imposture, of intellectual 2 theft and academic villainy. He is the all-too-present

person who will not spare a though before committing intellectual crime in order to get the job. Mr. Ca[ol, however, is in a class of his own, because even if there are countless politicians and party cronies that collect dubious academic titles, no one has gone as far as to fabricate his own university diploma and forge an official academic document. Nobody other than Mr. D\nu] Ca[ol has fabricated their own diploma and managed to get away with it. It's absolutely incredible how a person that should hardly be allowed to change bulbs and fuses in the buildings of Transelectrica found his way to the company's CEO chair and was allowed to sit in it.

Never since the dark times of the late '40s and early '50s has professional imposture become state policy, promoting inept people to strategic positions within state-owned companies or to key positions within the state apparatus. Never since the darkest hours of the communist economy have people with no economic aptitude been promoted to such important positions. People like D\nu] Andru[ca, a functional illiterate that found it difficult to put together three words to articulate a meaningful sentence, or Anton Anton, the one who wanted to store electricity in disused gas deposits, have held ministerial positions. Or Petre Daea, with his obsession for sheep and cormorants. Or Viorica Dancila, the Prime Minister who can't stop massacring the Romanian language or committing diplomatic gaffes that literally put our nation at risk.

Meanwhile, Romania has become a net importer of electricity for the second month in a row. In September, the price for electricity hit the record-high 750 lei/MWh and the average price on the day-ahead market is double than the one recorded on the connected markets like Hungary, Czech Republic or Slovakia. And on Friday, September 20, 2019, Romania recorded the lowest production of electricity in modern history. The price of natural gas rocketed too, and Romania's imports cost double than in the Vienna hub. And the weather is still warm, but come winter we will discover the wisdom in one of our expresident's words, as he pointed out that "winter is not like summer".

Yes, ineptitude, imposture, theft (be it intellectual or otherwise) have a price. We all pay it, in full.

BANKING

ALPHA BANK ROMANIA, A CORE ASSET OF ALPHA BANK GROUP

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Twenty-five years of organic growth have driven Alpha Bank Romania among the first 10 banks in the country, constantly supporting economic growth. In 2018, Alpha Bank Romania presented adequate capitalization, as the solvency ratio stood at 24.3% and the bank had total assets of 3.63 billion euro. At the end of 2018, the bank's branch network comprised of 130 units and its staff totaled 1,976 employees.

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Alpha Bank Romania has granted mortgage loans exceeding 1.1 billion euro since 2001. The bank keeps meeting market demand, the latest developments being the construction and green housing loans. During 2019, the bank has also significantly enhanced its deposit base, attracting deposits from both domestic and international markets. In the first half of 2019, deposits stood at 2.44 billion euro, growing significantly above market rate.

At the same time, the bank has significantly strengthened its position in the payments and ecommerce segment. Its latest initiatives include the partnerships with UnionPay International (Alpha Bank has been the first bank in Romania to accept UnionPay cards at its own ATM network since May 2019), with the Symphopay fintech on implementing a “POS sharing” solution, and the partnership with the PayU fintech, which has led to the successful implementation of the new “instant money back/ fast refund” solution on the eMag online platform. The type of transaction certified by Alpha Bank Romania is a first in Europe, and uses the latest Visa and Mastercard technologies.

Sergiu Oprescu, Executive President Alpha Bank Romania and General Manager of the International Network Alpha Bank Group, said: “Alpha Bank Romania has balanced tradition and innovation since the beginning of its activity. We had the chance to benefit from the support of an international financial group with a consistent history and a valuable banking expertise and at the same time we had this permanent desire to open new roads, to innovate, which I think defines our DNA. Since the establishment of Alpha Bank in Romania, the Group’s strategy has been based on prudence, long term vision, a long-distance running attitude, acting with confidence and vision.

Alpha Bank Romania is today a robust, mature bank, with a leading stake in the local banking system, which has constantly contributed to the growth of the Romanian economy.”

Regarding corporate banking, Alpha Bank Romania is a pioneer in financing new business areas and promoting innovation and sustainability; a dedicated team of experienced relationship managers and financial analysts specialized in various economic fields - including energy, real estate, retail and financial services - build sound business partnerships and deliver remarkable success stories. Some of the latest projects include financing the development of the UBC3 office building, part of the iconic Iulius Town, Timisoara, agribusiness projects, logistics acquisitions, hospitality projects etc. alongside the continuous support of the bank’s existing customer base.

In May 2019, Alpha Bank Romania successfully completed its inaugural 200 million euro covered bond issue, as part of its recently established 1 billion euro direct issuance Global Covered Bond Program. This is the first-ever covered bond issue from a Romanian bank, and marks a milestone for both Alpha Bank Romania and the Romanian capital markets. Introducing this new funding tool in the Romanian banking market, Alpha Bank Romania is proving once again its pioneering capabilities. The bond, which has a five-year maturity and pays a floating rate coupon, is backed by prime Romanian residential mortgages and is rated Baa2 by Moody’s. The transaction attracted strong investor interest from both local and international institutional investors including the IFC and the EBRD. The bond is listed on both the Luxembourg and the Bucharest Stock Exchanges.

GREEK ECONOMY: ECONOMIC RECOVERY ACCELERATES The year 2019 marks the beginning of a new course for the Greek economy, as the recovery of economic activity accelerates, with the real GDP growing by 1.9% on an annual basis in the second quarter of the year, despite a less favorable international environment. The business sentiment and consumer confidence leading indicators have improved significantly in Greece on the back of

renewed political stability in the aftermath of elections and promising expectations for the progrowth policy agenda of the newly elected government. The key priorities of this agenda include a broad reduction in tax rates, an acceleration of the privatization program and a commitment to reduce bureaucracy.

The improved economic conditions have been reflected in the lift of capital controls, the further drop in unemployment as well as in the recovery of the residential and commercial real estate market after a decade of continuous decline. The strengthening market confidence is also most notably expressed in the declining Greek government bond yields with the benchmark 10-year bond reaching an all-time low yield of 1,57% and reflecting a significant fall in sovereign risk.

Additionally, banking system liquidity is improving as deposits keep rising and banks have fully repaid the central bank’s emergency funding and are able to raise liquidity from the international money markets and thus diversify their funding sources.

ALPHA BANK GROUP: IMPROVED ENVIRONMENT SUPPORTS RESTORATION OF PROFITABILITY An improving domestic macroeconomic environment provides the basis towards the restoration of the group’s profitability. In H2 2019, Alpha Bank increased its profitability (Profit After Tax at 86.8 million euro vs. 12.7 million euro in H1 2018) and capital levels and it continued to move ahead with the implementation of its NPE reduction plan, launching two sizeable NPE transactions.

Alpha Bank continued to extend credit to the private sector with new loan disbursements in Greece of 1,5 billion euro in H1 2019. New financing is expected to pick up pace in the second half of 2019.

In terms of Capital adequacy, Alpha Bank has the highest capital base among Greek banks, with a CET1 ratio currently standing at 17.8% as of the end of June 2019. The total capital adequacy ratio of 17.8% is well above the 13.75% Overall Capital Requirement target set by the regulator for 2019.

At the end of June 2019, the total group loans stood at 51.3 billion euro, of which 86%, or 44.1 billion euro, in Greece. This leads to a loan market share of around 24% in Greece, placing Alpha Bank as the second largest lender. In turn, group deposits stood at 39.3 billion euro, of which 33.3 billion euro in Greece, accounting for a market share of around 22%.

Based on the tailwinds of the improved economic conditions Alpha Bank’s management will

communicate in the fourth quarter its ambitious strategy plan to the market.

ABOUT ALPHA BANK GROUP Alpha Bank is one of the leading groups of the financial sector in Greece. With presence in Albania, Cyprus, United Kingdom and Romania, Alpha Bank counts more than 11,000 employees and 603 branches in Greece and abroad. It offers a wide range of high-quality financial products and services in the domestic and international markets and has one of the highest capital adequacy ratios in Europe.

Founded in late 19th century, its history covers 140 years in the Greek financial sector. The bank,

since its establishment, has always been a privately owned business.

Alpha Bank has been listed in the Athens Stock Exchange since 1925. Currently, it enjoys a large and diversified shareholder base with foreign institutional shareholders holding around 77% of the total shares.

In recent years and following the Greek banking consolidation, Alpha Bank has managed to emerge stronger and bigger. In 2012, it acquired Emporiki Bank, the fifth largest bank (in terms of loans) from Credit Agricole Group, while a few years later, on the asset gathering front, Alpha Bank acquired the Citibank retail operations in Greece (2014), increasing its penetration to affluent clientele and high net worth individuals, which has always been the bank’s traditional strength.

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SERGIU OPRESCU, EXECUTIVE PRESIDENT OF ALPHA BANK ROMANIA

ENTREPRENEUR

MELI MELO PARIS LAUNCHES

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Stéphane Dumas is a member of the board at Meli Melo Paris, an entrepreneur and one of the founders of this brand in Romania 21 years ago. Since 1994, he has lived in Romania, learned the Romanian language and adapted to the local landscape.

Currently, Meli Melo Paris has 61 stores globally, of which one exclusive store, one franchised store, two department stores, seven Meli Melo Deco stores, three stores in Chisinau (Republic of Moldova), three in Sofia (Bulgaria) and three in Belgrade (Serbia).

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YOU HAVE RECENTLY ANNOUNCED THE COMPANY’S EXPANSION BASED ON A FRANCHISE PROGRAM. WHAT ARE YOUR PLANS IN THIS REGARD?

WHAT ARE THE REQUIREMENTS FOR PROSPECTIVE FRANCHISEES AND WHAT IS THE COST OF A FRANCHISE?

We have a mature enough concept that can be franchised. For Meli Melo it was already time to start this development both in Romania

The franchising process for the Meli Melo brand is simple and concise. We rely on a reverse strategy, namely focusing on smaller cities because they have a much faster rate of development, and we can find enough motivated and dedicated people to achieve the desired results.

With regard to the general conditions for the Meli Melo Paris franchise, our business partners should have an interest for the retail sector, and preferably have experience in the field, but that is not a must, they should be passionate about the fashion and fashion accessories industry, they should be involved and dedicated. The cost of a franchise varies between 60,000 and 80,000 euro, depending on retail space-related expenses and logistic factors involved in designing the store in keeping with our standards.

and internationally. Therefore, our franchising strategy has a dual focus: a national franchise in Romania and an international franchise for other markets that we are not covering directly today.

As for the franchise in Romania, we already started exactly one year ago in Targu Jiu, and it’s been a real success; we are very pleased with the sales and with the collaboration. We now plan to expand the franchise to eight more cities with potential, where we are not yet represented: Oradea, Baia Mare, Satu Mare, Botosani, Piatra Neamt, Deva, Alba Iulia and Targoviste.

WHAT SHOULD PROSPECTIVE MELI MELO FRANCHISEES KNOW BEFORE THEY START SUCH A BUSINESS? We will have a real partnership with our franchise partners. We will offer them assistance in choosing their store location, negotiating the contract with the landlord, training their employees and helping with the management of

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FRANCHISE PROGRAM the store. We will always consider our franchisees as a part of Meli Melo group and provide our support as often as it is needed.

WHAT IS THE SIZE OF MELI MELO’S BUSINESS IN TERMS OF TURNOVER? At the end of 2019, we should reach a total of 20 million euro in four markets: Romania, Moldova, Bulgaria and Serbia.

WHAT ARE YOUR FUTURE DEVELOPMENT PLANS FOR MELI MELO? In the next three years, our strategy will focus on expanding the Meli Melo Paris franchise to several cities, expanding the network of home decor stores, Meli Melo Deco, to cover the main cities countrywide, as well as developing our online e-commerce activity on melimelo.ro. We also plan to develop our corporate and distribution divisions, and our international network in Moldova, Serbia and Bulgaria.

In addition, we will expand the Meli Melo Paris international franchise to other countries.

STÉPHANE DUMAS

BANKING

GET YOUR IDEA::BANK CREDIT CARD WITHOUT VISITING THE BANK

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With a policy based on transparency and partnership, Idea::Bank now offers a new interest-free credit card installment plan, for purchases at points of sale in Romania and abroad.

With Idea::shopping card customers can shop online or in retail stores anywhere in the world, benefiting from two up to 12 interest-free installments.

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Advantages: - ZERO interest rate anywhere in the world, for online and in-store card payments with a minimum value of 200 lei per transaction - simple and effortless, installments are generated automatically - ZERO lei issuance fee for Idea::shopping card - ZERO lei annual administration fee for Idea::shopping card, in the first year - ZERO commission on online and instore payments - up to 55-day ZERO interest rate grace period for card payments - online purchases are always safe, as the card is automatically enrolled for 3-D Secure authentication - generous loan limit of up to 40,000 lei - fixed current interest rate: 17% per year (when incomes are received in an Idea::Bank account) on transactions not included in the installment plan.

Idea::shopping card applications will be accepted from eligible customers (aged 18 or older, with a minimum monthly income of 2,500 lei, and at least three months in the current job), without requiring a visit to the bank.

Customers may apply online at www.idea-bank.ro, they can use phone numbers *4455 and 021.318.95.00 or send an SMS text message containing “Shopping Card” to 1710.

Idea::Bank’s individual customers can opt for a Mastercard-branded Idea::shopping card in two variants: Idea::shopping card standard and Idea::shopping card gold, the latter including travel insurance, purchase protection, and an exclusive benefits package offered under the Mastercard Premium&Business program.

Idea::shopping card holders will be able to apply for up to three additional credit cards attached to their account and have round-the-clock access to Idea::iBank, the free-of-charge internet banking service, and Idea::alerte, the SMS alert service, sending a text message for each online transaction exceeding 100 lei.

Loan repayment options Customers can pay at least five percent of the total monthly due amount (no less than 50 lei), they can cover the outstanding monthly payment in full or make any payment, larger than the minimum amount due.

The amount used from the Idea::shopping card loan limit can be repaid through several channels: using the Idea::iBank service from an Idea::Bank account, by payment order from a current account at any bank in Romania, at SelfPay stations or directly at Idea::Bank Romania’s desks.

Calculation example: For Idea::shopping card with a loan limit of 5,367 lei, the interest is 17%/year in the case of the monthly income transfer into an Idea::Bank account.

The annual effective interest rate (DAE) is 18.39% over a 1 year period and the total payment is 5.861,21 lei. Values were calculated on the assumption that the loan limit is fully utilized by payments lower than 200 lei, immediately after the grant, and repaid in equal monthly installments. The calculation does not refer to the use of loan limit with interest-free installments.

For more details about this product visit www.idea-bank.ro About Idea::Bank România Idea::Bank România offers products and services to both individuals and SMEs, relying on the development of new technologies (Internet and digital banking) and operating a selective territorial network of 33 branches in Romania. Idea::Bank is part of the Getin Holding group, one of the most dynamic financial groups listed on the Warsaw Stock Exchange (MWIG 40 index), with extensive operations in Central and Eastern Europe, specializing in retail banking and leasing, with more than 6,000 employees. Find more details at www.idea-bank.ro, on Facebook www.facebook.com/ideabankromania and on the Idea Bank YouTube channel.

in partnership with

Business Arena Magazine is proud to announce the 19th edition of its annual event dedicated to the leaders in the financial market:

FINANCIAL LEADERS’ HALL OF FAME 2019

Some 200 persons from the financial and baking sectors, directors of investment funds and representatives of some of the largest companies in Romania, together with representatives of the local authorities, high government officials and diplomats will take part in this exclusive event.

Invited to give the opening remarks at last year's edition, Raiffeisen Bank Romania’s CEO Steven van Groningen emphasized that making predictions in the banking and financial industry was somewhat risky, but overall the trend was positive. “The banking system is profitable and we have seen a process of consolidation, which is good news for the system’s long-term sustainability and strength,” he said. He also indicated that investments in technology were important, as they allowed banks to spend more time analyzing customers’ needs.

However, the Government's move to approve Emergency Ordinance 114 late last year, introducing, among others, a new tax on bank assets, may change the outlook for the entire industry.

In this context, Business Arena Magazine is proud to recognize the achievements and successes of banks, financial institutions and business leaders that find the winning strategies in spite of the challenging economic background.

For more information please contact Cosmin Stangaciu at cosmin.stangaciu@business-arena.ro or phone 0755.274.125

Interview

UFUK TANDOĞAN, CEO GARANTI BANK ROMÂNIA

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WE ARE HEADING TOWARDS A DIGITAL-ORIENTED BANKING SYSTEM, BUT UNTIL THEN, WE HAVE SOME OTHER CHALLENGES AHEAD

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Digitalization has taken banking by storm in the last years. How do you adapt to this trend?

Let me start by saying that there is no surprise to see this dynamism in banking. After other big industries, such as travel, auto, insurance or entertainment have been profoundly changed by the new technologies, it was a matter of time to see our industry influenced by this trend. New players, new products and new services are luring especially the young customers. Mobile banking is growing fast and is becoming the main instrument in banking, at least for basic services. We more

than welcomed this trend, by investing early and substantially in our digital channels.

We are one of the pioneers of the digital banking in Romania. Currently, we are the 6th bank in Romania in terms of digital banking penetration. In 2018, the value of the transactions performed through our internet banking platform - Garanti Online, increased by 60%, compared to 2014. In the same year, we registered an increased volume by 60% of mobile banking transactions that were operated through our mobile banking application Mobile ME, compared to the previous year. About 47% of Garanti Bank’s deposits are being opened

services, we benefit from the support and knowhow of our shareholders. Garanti BBVA has over 7.5 million digital customers (67% penetration), while Banco Bilbao Vizcaya Argentaria (BBVA) reached 29 million digital clients. BBVA was recognized last year by Forrester Research as having the best mobile banking app in the world, in the top of mobile service offerings from 53 banks across the world.

How do you see the context created by the new competitors, the so called fintech companies?

Competition in the banking industry has refined throughout the years. But at least for now, for the Romanian market, banks have nothing to worry from the fintech and tech companies as long as they constantly improve the delivery of financial services on digital channels, expand their presence online, and connect with people 24/7 through social networks. Some of the banks are developing their own products to compete with these new players, other banks are trying to buy them. We believe that collaboration, not the competition is the future in this field.

through Garanti Online. Also, we try to customize our products and services to best fit the needs of our customers, because we strive to be a bank with a client centric approach. This is the reason why we always design new products and launch new campaigns. We want to make sure that our clients know they have in us a partner for the long run.

We have just been awarded for the 12th time in the past 11 consecutive years, by the worldwide-recognized Global Finance magazine, as “Best Consumer Digital Bank in Romania�. We are the only bank in Romania to win such a prestigious award. In developing our digital

What do you think about the magnitude of financial intermediation in Romania? Is it enough to support local entrepreneurs The market context and some historic problems are keeping the banking sector and Romanian economy still behind its neighbors in Central Europe. The banking sector’s asset size is 95 billion EUR which is around 50% of GDP, while the EU average is over 200% and CEE countries have 100% or higher. Unfortunately, Romania has the last ranking in Europe in this regard.

Romanian banks have around 70 billion EUR customer deposits and together with other funds sector has a total funding capacity of 85 billion EUR. Plus, there is an equity of more than 10 billion EUR in the banking sector.

There are several reasons for this low financial intermediation. First, due to the bad reputation of the insolvencies in Romania banks are more conservative in order not to face problems after granting loans. Every year more than 8.000 companies are going into insolvency. If you consider there are only 720 thousand companies the number of insolvency cases is huge. In Poland there are 2 million companies and insolvency number per year is just 1.000.

Also, in Czech Republic and in Bulgaria the numbers are very low. For example, in Bulgaria there are only 300-400 insolvency cases per year. Unfortunately, some companies in Romania

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Interview

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are abusing the weaknesses of the insolvency law and banks find that taking back their loans is a very long and difficult process. And this “strategy” created a huge pressure on the profitability of the sector. Only between 2011 and 2016 the Romanian banks made 11 billion EUR provisions, and more than half was related to insolvency cases.

So, the banks are thinking twice before making a credit decision due to the bad experience of insolvency cases. In recent years banking sector preferred to take sovereign risk much more than granting loans to entrepreneurs. And today, there are significant amount of government bonds in the banks’ balance sheets. Over 20% of the banks’ assets are state bonds and it is one of the highest levels in Europe.

Second reason for the low level of financial intermediation is the high share of rural population. That’s why only 60% of adults in Romania have a bank account. This is significantly below the average of the other countries in the region which is 75%.

Third reason of the low financial intermediation in Romania is the shadow economy, which is estimated to be 28% of GDP, the second highest in EU, after Bulgaria. The fourth reason is that the size of business loans is very low because of limited number of enterprises. In Romania there are around 720 thousand companies. But most of these companies are inactive or have very low equity and very low turnover. For example, around 600.000 companies have zero turnover or below 100.000 euro yearly.

So, from the bankers’ point of view, only a very limited number of companies are eligible for bank loans. According to World Bank-IMF report only 128 thousand of companies are eligible in terms of minimum financial criteria of the banks.

Fifth reason for the low banking intermediation is that some industries are dominated by multinational companies and those companies are benefitting loans from their parent companies or mother country banks instead of taking a loan from Romanian banking system.

What are your advices for the local entrepreneurs?

As banks, we expect full transparency from the companies that want to become our clients, everything related to their business, especially their financial situations. They should have an open dialog with the banks. As I mentioned,

insolvency is still a big problem for Romania and because of that banks suffered a lot of losses.

With a transparent communication, the trust between banks and entrepreneurs will be strengthened. Sometimes a company can have difficulties. In these situations, it is better for both parties to agree on a restructuring plan before going into insolvency. It is very important to keep the trust between the partners. This is also true for smaller companies – transparency and fairness are the building blocks of a longterm relationship.

What are your strengths on the Romanian market?

Generally, in Romania the competition is price driven, there is no secret about this. Our prices are, of course, aligned to the market level, but our competitive advantages come from our brand, our technology, our human capital and our innovative products.

We are part of a great financial family, an advantage in this very dynamic banking environment. We have strong shareholder support and a strong reputation locally, but also globally. Garanti Group Romania is held by Garanti BBVA, the second largest private bank in Turkey. In the first half of 2019, Garanti BBVA posted a consolidated net income of EUR 560.24 million and an asset size of EUR 64.48 billion, while its contribution to the economy through cash and non-cash lending totaled EUR 48.27 billion.

Garanti BBVA serves over 17 million customers in corporate, commercial, SME and consumer segments, offering fully integrated financial services. Spanish financial group Banco Bilbao Vizcaya Argentaria (BBVA) is the majority shareholder of Garanti BBVA. In the first half of 2019, BBVA registered a net attributable profit of EUR 2.44 billion.

Secondly, we have highly centralized operations, which bring efficient processes and best customer experience. We also take pride in our technology and our state-of-the-art digital products – Garanti Online and Mobile Me. Also, Garanti Bank is one of the first and still few banks in Romania with a complete smart ATM network.

We are constantly increasing the operational efficiency of the bank, significantly over the sector average. We have been focused on improving the asset quality of the bank.

Currently our NPL ratio fell under 4%, and it is significantly under the sector average.

INTERVIEW

COFFEE-MAKING AS AN ART Mihail Florescu is a true craftsman. His passion for coffee has flourished into a successful business, and he takes pride in his mission to educate the taste of coffee consumers. In an interview with Business Arena, Mr. Florescu emphasized that "artisan coffee is a healthy coffee."

When did you discover your passion for coffee and how was it turned into a business idea?

The Romanian coffee scene was very poor in the ‘90s. But the actual business idea came from my wife, who, at the time, was a world leading manufacturer of coffee roasting machines. Now, the factory is no longer owned by the family, but before the ‘90s, I worked in sales of coffee roasting equipment. So, we could say that my passion for coffee began in the 1980s.

What was the total investment in the Cornetu production unit and what is its total production capacity?

The facility has a production capacity of around one tonne per day, while the total investment stood at about one million euro.

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What types of coffee are produced at your facility and what are the favorites among local consumers?

We produce about 30 types of coffee from all over the world. We have coffee from Africa, from

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The story began in Timișoara, where Mihail Florescu founded Phoenix Impex, together with two other business partners. At the same time, “Torrefatione Italiana” was born, the first coffee roasting facility in the city.

In 1996, the company sees a change in shareholding structure, with Mihail Florescu becoming sole shareholder of the resulting company, Global Trade. Moreover, the company moves its operations to Bucharest.

Two years later, the Leonard Caffe brand is registered, its main strengths being tradition, passion and quality. The brand had already been visible on the market, enjoying recognition among consumers, which encouraged the next step: the opening of the first coffee shop for coffee tasting.

No less than 25 types of coffee could be tasted there, and customers could also get coffee for home.

In 2008, the production facility moves to Cornetu, some 20 km south­west of Bucharest city center. The new building, built on the edge of the forest, soon becomes a true coffee temple. Unique coffee blends are created there.

MIHAIL FLORESCU Latin America, from Asia, and the most appreciated are our original blends. They are our exclusive recipes and combine several types of coffee, being ideal for a good coffee.

What is the size of the Coffee Workshop network and how many new outlets are planned to be open in the near future?

Currently, there are around 30 such units in Romania, one in Dublin, and another one in Chisinau, and I plan to expand this network, with a new design. Our first new outlets are being prepared for opening.

What is the value of the Romanian artisan coffee market and how is competition in this segment?

The competition is getting stronger and I am very happy that many young people have discovered their passion for coffee and are starting to get involved in this business.

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Romanian producers are excellent, because we have a very sophisticated market, with good quality coffee.

However, there are fewer than 100 local producers, and when we talk about producers, I mean those who process the raw product, which is the green coffee. Italy has 1,500 - 1,600 producers. It’s true that Italy’s population is three times larger than Romania’s, but, even so, there is a lot of room for growth in Romania. Good coffee is created by the people who roast it. As for the size of the market, we are talking about millions of cups of coffee per day.

Who are your main customers and what new market segments have potential for your company?

I am very proud to say that the young people of Adobe’s local branch are some our major

customers, who appreciate our products. We have even offered training sessions, so they can learn about coffee tasting. I am also very pleased to steal customers from supermarkets, as they offer a banal, industrially processed coffee, using borrowed aromas. It’s a real joy to be able to attract new customers who can appreciate artisan coffee.

What are your main goals for 2020?

We plan to open as many outlets as possible, promoting a partnership system, I don’t like to call it a franchise. This partnership is based on a coffee brand that I have personally registered with OSIM [State Office for Inventions and Trademarks], “Cea mai buna cafea pe onoarea mea” [The best coffee, I stake my honor on it].

And quality is guaranteed, considering that for 30 years I have been producing coffee in Romania, and I spent another 10 years selling coffee processing equipment throughout Europe.

ECONOMY

OECD SEES RISING TRADE TENSIONS AND POLICY UNCERTAINTY FURTHER WEAKENING GLOBAL GROWTH

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The global economy has become increasingly fragile and uncertain, with growth slowing and downside risks continuing to mount, according to the OECD’s latest Interim Economic Outlook.

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Economic prospects are weakening for both advanced and emerging economies, and global growth could get stuck at persistently low levels without firm policy action from governments, according to the Outlook.

Escalating trade conflicts are taking an increasing toll on confidence and investment, adding to policy uncertainty, aggravating risks in financial markets and endangering already weak growth prospects worldwide. The OECD projects that the global economy will grow by 2.9% in 2019 and 3% in 2020 - the weakest annual growth rates since the financial crisis, with downside risks continuing to mount.

The Outlook covers all G20 economies, and includes downward revisions to projections from the previous Economic Outlook in May 2019 for almost all countries, particularly those most exposed to the decline in global trade and investment that has set in this year.

The Outlook identifies the trade conflicts as the principal factor undermining confidence, growth and job creation across the world economy, and underlines that continuation of trade restrictions and political uncertainty could bring additional adverse effects. While solid consumer demand has supported service sector output to date, persistent weakness in manufacturing sectors and continuing trade tensions could weaken employment growth, household income and spending.

Substantial uncertainty persists about the timing and nature of the withdrawal of the United Kingdom from the European Union, particularly

as concerns a possible no-deal exit which could push the UK into recession in 2020 and lead to sectoral disruptions in Europe. Other risks including the overall slowdown in the Chinese economy and significant financial market vulnerabilities from the tension between slowing growth, high debt and deteriorating credit quality – are also weighing on future growth.

“The global economy is facing increasingly serious headwinds and slow growth is becoming worryingly entrenched,” said OECD Chief Economist Laurence Boone. “The uncertainty provoked by the continuing trade tensions has been long-lasting, reducing activity worldwide and jeopardising our economic future.

Governments need to seize the opportunity afforded by today’s low interest rates to renew investment in infrastructure and promote the economy of the future,” Ms Boone said.

The Outlook calls on central banks to remain accommodative in the advanced economies, but stresses that the effectiveness of monetary policy could be enhanced in many advanced economies if accompanied by stronger fiscal and structural policy support. It says fiscal policy should play a larger role in supporting the economy, by taking advantage of exceptionally low long-term interest rates for wider public investment to support near-term demand and future prosperity. Greater structural reform ambition is required in all economies to help offset the impact of the negative supply shocks from rising restrictions on trade and cross-border investment and enhance medium-term living standards and opportunities.

ECONOMY SHOWS NEW SIGNS OF WEAKNESS Experts already see the seeds of a new global recession, while Europe still seems unable to employ a coherent economic policy. Moreover, Germany's spell of economic weakness is expected to have ripple effects throughout central and eastern Europe.

Unsurprisingly, finding efficient tools to tackle economic threats has been a major concern among governments and economists. In his opening remarks at the ECB conference "Resilience to global headwinds?

BY CRISTIAN COJANU CESEE responses to a changing trade and financial landscape", in Frankfurt, central bank Governor Mugur Isărescu took the opportunity to offer a few suggestions about what is advisable in terms of economic policies so economies could cope with future adverse developments.

"For the sake of simplicity, allow me to try to formulate three general rules that are instrumental in dealing with such developments." said Isărescu.

He continued: "First of all, irrespective of the possible scenarios, it is wise to put your house in order before the storm comes. One example is fiscal consolidation, which is paramount for the economy. Relatively high fiscal and current account deficits may weaken the foundation of the building and adjusting them in a smooth manner is a much more sensible thing to do than letting the market forces make an abrupt correction. As regards monetary policy, strict liquidity management represents a step in the right direction.

"But, of course, monetary policy alone is not enough. Which brings us to the second rule: there is no substitute for a predictable and coherent economic policy mix. Let me stress that it should remain so even when facing the challenges of election years (there are several election rounds in Romania in 2019 and 2020).

A significant pace of economic convergence is desired, but the process should unfold sustainably to preserve macroeconomic equilibria and safeguard competitiveness. As I usually put it, to successfully adopt the euro, one should be a marathoner rather than a sprinter.

"Last, but not least, the third rule might be as

follows: when the normalization wave eventually hits, the magnitude of the impact will depend on how vulnerable emerging economies are to external financing. A contained current account deficit, a long average maturity on public and private foreign currency debt and a coherent mix of countercyclical macroeconomic policies and structural reforms would go a long way in limiting the risks. If proper economic policy actions are not implemented while there is a window of opportunity, the possibility of a forced resort, in a more or less distant future, to sub-optimal measures in the face of adversity cannot be ruled out.

"To sum up, keeping domestic and external imbalances in check is the only way the CEE economies will be able to cope with any strong volatility headwinds."

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ECONOMY

RON PAUL: US INTEREST RATES ARE GOING NEGATIVE, AND THE FED CAN’T STOP IT Ron Paul is warning negative interest rates will crush the global economy.

The former Republican congressman from Texas believes the U.S. won’t be the exception.

“We will join the rest of them and go to total negative rates in hopes that that will be the solution,” he told CNBC’s “Futures Now” on Thursday. “We’ve never had as many currencies in negative interest rates. $17 trillion worth of bonds [are] in negative interest rates. It’s never existed before. And, that’s a bubble.

So, we’re in the biggest bond bubble in history, and it’s going to burst.”

Paul, a former presidential candidate and vocal libertarian known for his economic and stock market bubble warnings, contends the Federal Reserve’s policies are powerless in this environment. He doesn’t believe this week’s

levels. Yet, he’s unsure of the timing of a collapse.

“You don’t know this precise time. But you know it can happen,” he said. “How do you sell a bond that pays a negative rate? Who’s going to jump up and down?”

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FLASHBACK OCTOBER 2018

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Fed meeting will provide any kind of relief and cutting rates will not be the answer.

“You can’t predict exactly where the creation of credit goes,” said Paul. “We have a ton of inflation with all that QE [quantitative easing]. And, every time you lower interest rates below market levels and create new credit, that’s a bubble.”

Paul has been waving the red flag for years, warning that a once in a lifetime market drop of 50% or more will strike stocks. With bonds yielding negative rates now in focus, he suggests the danger is ballooning to unseen

But what a difference a year makes.

Paul was worried about the other extreme last October — when the benchmark 10-year Treasury note yield rallied to seven year highs and hit 3.26%, creating inflation jitters.

“It can be pretty well validated by looking at monetary history that when you inflate the currency, distort interest rates and live beyond your means and spend too much, there has to be an adjustment,” Paul told “Futures Now” last October. “We have the biggest bubble in the history of mankind.”

On Friday, the 10-year yield closed at 1.9%, its highest level since August 2.

So, why is Paul still warning an epic bond bubble will burst an create chaos if rates are no longer above 3%? According to Paul, central banks which drastically lower interest rates destroy the pricing mechanism in financial markets.

“I don’t think anything even existed coming close to what we’re facing today,” Paul said.

'WE PRICK THE BUBBLE, AND EVERYTHING COMES IMPLODING DOWN':

PETER SCHIFF SOUNDS OFF ON THE 'ARTIFICIAL' ECONOMY - AND WHY THE NEXT BIG RECKONING IS INEVITABLE If you're looking for a rosy outlook for the US economy, it's probably best to steer clear of Peter Schiff. The president and CEO of Euro Pacific Capital sees trouble brewing in the "artificial" US economy. Moreover, he thinks the halcyon days of growth and prosperity within US borders are wearing thin — and he isn't going to sugarcoat his perspectives, especially when it comes to the party he thinks is responsible for it all: the Federal Reserve. "There's a limit to how long the Fed can continue to keep interest rates artificially low," he said in a recent edition of The Peter Schiff Show Podcast. "The longer they succeed in keeping them low, the bigger the ultimate failure is going to be when it comes to everything collapsing down."

To him, the Fed's policies have created a massive bubble— via interest rate cuts and quantitative easing — that's artificially inflated assets of all kind within the US economy, and created an environment that is extremely speculative. What's worse, time is running out.

"You have the federal government borrowing record amounts of money, you have states and municipalities borrowing record amounts of money, you have corporations borrowing record amounts of money, you have individuals borrowing record amounts of money," he said. Schiff added: "This whole phony economy that was built on artificially low interest rates implodes, and it's not a question of if it will happen, it's only a question of when." And he's just getting warmed up.

Please only use the sharing functionality at the top of the article. These stories are exclusive to our members. Email bi-prime@businessinsider.com to buy additional rights. More information on BI Prime can be found here.

Schiff points to the IPO market as a prime example of how the Fed's ultra-low interest rate policies are having a nefarious effect on today's market. In his view, it's made debt way too easy to come by, and has pushed valuations — undeservedly — into the stratosphere.Please only use the sharing functionality at the top of the article. These stories are exclusive to our members. Email bi-prime@businessinsider.com to buy additional rights. More information on BI Prime can be found here.

Please only use the sharing functionality at the top of the article. These stories are exclusive to our members. Email bi-prime@businessinsider.com to buy additional rights. More information on BI Prime can be found here.

Here's how some of the more notable IPOs issues have performed since offering their shares

PETER SCHIFF to the public: Uber ( UBER): -33% Lyft ( LYFT): -43% Slack (WORK): -17% Fiverr ( FVRR): -15% And that's not counting WeWork and Endeavor, who recently postponed their IPOs amidst the turmoil.

Unfortunately, the only way Schiff sees the problem being resolved has dismal implications — ones he thinks has the potential to upend the entire economy. "Interest rates need to rise," he said. "That's part of the cure, that's part of the solution. But when they do, we prick the bubble — and everything comes imploding One example of this, is what's going on with a lot of these stocks — these money-losing companies," he said. "In the speculative fever that the Federal Reserve created, investors didn't care about how much money companies were losing — and they were investing in them anyway, because they just thought they would make money finding a greater fool to pay an even higher price." It's hard to disagree with Schiff's point here.

Companies that have garnered sky-high valuations in private markets have been getting crushed when they come public arena.

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But financial inclusion depends on a number of factors among which I mention: the social exclusion level and the level of education, including financial literacy here.

Despite recent improvements, poverty and income inequality continue to be high in

GABRIELA FOLCU}

Romania, while regional differences have been deepening. In Romania, 1 of 3 Romanians continues to be exposed to poverty risk. We must mention that vulnerable people benefit from facilities in their usage of payment accounts.

As such, the percentage of the people exposed to poverty risk or to signal exclusion stands at 35.7% of Romania’s population, compared to 22.5% in the EU (2017), according to Eurostat. And an alarm system comes from migration. Migration reached a worrying

level, standing at 15% of the country’s population, respectively 25% of the active population.

According to the World Bank, in Romania, almost 60% of the unbanked people are part of the poorest 40% households.

This is how we can explain the low level of the population’s financial intermediation against the GDP, standing at 16.1%, compared to the euro area (57.9 %) and to the other countries of Central and Eastern Europe (Poland – 35.6%, Hungary 18.4%, Bulgaria - 23%).

Moreover, between financial inclusion and the level of financial education there is a direct correlation.

According to surveys, merely 1 of 5 adults understands basic financial products, therefore placing Romania on the last position in Europe, with a financial literacy rate of 22%.

The need for financial education at national level is considerably high, contemplating that Romania ranks among the last as regards the level of financial education in the EU, and at global level as well, ranking 123 out of 143 countries. A good thing is that the Development Strategy for Romania includes tactics meant to shrink the deficit compared to the European average. The Romanian Association of Banks has as strategic objective to enhance the level of citizens’ financial education, this being included also in the National Strategy for Romania’s sustainable development 2030 approved by the Government. We are fully available to collaborate in order to carry out this desideratum. All these actions have a common goal, namely to introduce financial education as a mandatory discipline in school.

Enhancing financial education, digitalisation, the level of financial intermediation and implicitly financial inclusion are targets to which all those accountable in the financial industry have to aspire, with a view to improve the Romanians’ standard of living.

BY GABRIELA FOLCU} EXECUTIVE DIRECTOR ROMANIAN ASSOCIATION OF BANKS

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CAPITAL MARKET

BVB GETS PROMOTED TO EMERGING MARKET STATUS Global index provider FTSE Russell said Romanian equities would be assigned "secondary emerging" market status effective September 2020, an upgrade from its current "frontier" status, three years after the country was added to the Watch List.

Commenting on the news, Bucharest Stock Exchange (BVB) CEO Adrian Tanase said: "We are here facing a historical moment: it's the international recognition that Romania

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ADRIAN TANASE

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deserves to be promoted and I am happy and proud to lead the team that made it possible.

When the stock market is doing well the economy is doing well. I do hope this status upgrade will make more managers from stateowned and privately held companies see the stock exchange as the go-to place where they can further develop their businesses.

"We are going to celebrate 25 years of modern trading at the Bucharest Stock Exchange in November next year. We aim to show our partners that we are committed to further improve the market infrastructure. To this extent, the CCP project will create the framework required to significantly improve market liquidity.

"Our goal for the next 10 years is to double the market representativeness in the local economy from the current level of 10% to 20% of GDP." In turn, Lucian Anghel, BVB President, said: "Romania's promotion to the Emerging Market status can be considered, from the economic standpoint of the capital market, the equivalent of the country's admission to the European Union. Romania deserved to be

promoted to the Emerging Market status as it has repeatedly proved itself as being a functional and accessible market.

"Funds much larger than the ones that have

LUCIAN ANGHEL

invested so far and that manage hundreds of billions of euros will be allowed to invest here in the next years as these funds' managers are restricted by the prospectus to invest in Frontier Markets.

"Romanian investors could benefit from this promotion in the long run if they choose to reap the rewards offered by the investment opportunities in the stock market. We would like to thank all the capital market stakeholders and authorities who have been close to the stock exchange in this capital market reform process that started around seven years ago."

According to FTSE Russell, Romania met the nine FTSE Quality of Markets criteria required for Secondary Emerging market status within the FTSE Country Classification scheme.

Romania had its stock exchange closed during the communist regime and had it reopened nearly half a century later. When the market reopened in November 1995, it started with six companies. Now, the Bucharest Stock Exchange (BVB) has 84 companies listed on the Main Market alone, with a combined capitalization of 36 billion euro.

GOLDMAN SACHS CEO SAYS APPLE CARD THE ‘MOST SUCCESSFUL CREDIT CARD LAUNCH EVER’ The Apple Card got everyone’s attention with special offers and low-interest rates. It also made headlines for accepting applicants with average credit scores. As we know Apple has tied up with Goldman Sachs for the credit card. Goldman Sachs CEO calls Apple Card the ‘Most Successful Credit Card Launch ever.’

In three short years, we have raised $55 billion in deposits on the Marcus platform, generated $5 billion in loans, and built a new credit-card platform and launched “Apple Card,” Solomon said, adding “which we believe is the most successful credit-card launch ever.

Since August, we’ve been pleased to see a high level of consumer demand for the product. From an operational and risk perspective, we’ve handled the inflows smoothly and without comprising our credit underwriting standards.

Apple Card is available for iOS users based in the U.S. Here is how to apply and use Apple Card. If you have already got the Apple Card then check out the best Apple Card tips and tricks.

OUR TAKE Apple alongsiwith Goldman Sachs is trying to change the way a credit card works. To begin with, on Apple Card you will get daily cashback, so no waiting for months to get your cashback. Thats not all, the card automatically breakdown transaction and helps you keep a track of your spending.

Once we move beyond the consumer perspective, the Apple Card seems like a very bullish bet by Goldman Sachs. The financial giant is spending as much as $350 to acquire new Apple Card users and analysts say that they might lose money. The odds of this happening increase if there is a recession in the next couple of years.

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GEOPOLITICS

ELECTIONS IN POLAND AND ROMANIA, AND WHAT WILL FOLLOW FOR THE EU

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The final quarter of 2019 will be eventful in Poland and Romania, the two largest countries on the European Union's eastern border. On Oct. 13, Poland will hold a general election that will test the popularity of the conservative Law and Justice party, which has been in power since 2015. Then on Nov. 10, Romania will hold a presidential election, where conservative President Klaus Iohannis is seeking reelection. (The second round is scheduled for Nov. 24.) These votes are unlikely to result in meaningful changes in foreign policy for Poland and Romania, which will remain committed to EU and NATO membership. But they will shape domestic events in a way that, over time, could influence Poland's and Romania's relations with their foreign partners.

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TWO GEOPOLITICALLY RELEVANT COUNTRIES Poland and Romania are former communist countries that, after the collapse of the Soviet Union, sought to align themselves with the European Union and NATO. Bucharest, and particularly Warsaw, see membership in these international alliances as protection against potential Russian aggression. They both push for a greater NATO presence in Eastern Europe, while they also defend the development of infrastructure projects to reduce the region's dependence on Russian natural gas. Because of their shared interests, they are both members of regional cooperation projects such as the Three Seas Initiative, which seeks to develop closer political and economic ties in the region and to build a better energy infrastructure connecting the Baltic, Black and Adriatic seas.

Poland and Romania also share similar interests when it comes to EU membership, in the sense that they are net receivers of the bloc's development and agricultural funds. And while Warsaw and Bucharest have expressed interest in adopting the euro, their moves to actually abandon their national currencies have been modest (which, ironically, somewhat protected them from the eurozone crises in recent years). But Poland and Romania share another element when it comes to the European Union: Brussels has expressed concern about the status of the rule of law in both countries. In recent years, the Law and Justice government in Poland and the Social Democratic Party government in Romania have introduced reforms to increase government oversight of the judiciary which, according to the European Commission, have weakened the judiciary's independence.

While Warsaw and Bucharest have watered

down some of these reforms under pressure from EU institutions, the European Commission is still not satisfied with the way things are going in Poland and Romania and has threatened to sever their funding unless the two countries fully comply with EU rules. Some governments, particularly France, have gone so far as to say that the process of EU integration should deepen for those "core" countries that are willing to play by the rules, while countries with a weak rule of law should be left behind. American criticism of Poland and Romania has been much milder, but U.S. officials have sporadically warned about corruption, particularly in Romania.

This presents an important threat to Poland and Romania because their foreign policies will continue to seek alignment with the European Union and NATO, but their domestic policies may make it harder for them to do so, particularly when it comes to the European Union. The threat to connect the disbursement of EU funds to respecting EU rules has been on the table for years, but the idea will be discussed again during the upcoming negotiations for the EU budget for 2021-2027. Should the European Union eliminate or significantly reduce its funding for Poland and Romania, their economies would be severely affected, and should the European Union deepen its twospeed integration process (in which some members expand their cooperation while others are not involved), then Warsaw and Bucharest could see their strategic goals threatened. In Romania's case, lingering concerns about the rule of law among EU institutions and key governments like Germany and France would continue preventing Bucharest from joining the

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passport-free Schengen area.

Naturally, these are not decisions the European Union will take lightly. After all, the bloc is interested in having prosperous, stable and politically transparent countries on its eastern border. Germany, in particular, will resist any attempts to weaken the institutional and economic ties with those countries that Berlin considers to be in its backyard. But while Poland and Romania seemed to be enthusiastic supporters of EU integration during their first decade in the bloc, recent events suggest that internal political developments are creating problems in their relations with Brussels.

And that's why the upcoming elections matter for both.

POLISH QUESTIONS Since winning the general election in 2015, Law and Justice has delivered on most of its campaign promises to increase public spending on social welfare programs.

This has made the party popular among those sectors of the population that felt neglected by previous governments. So far, criticism (both domestic and foreign) over the reforms in the judiciary or the situation of minority groups in Poland has not damaged the party's popularity. Moreover, a large sector of the electorate fears that a victory by the opposition could lead to a reduction in these spending programs.

This puts Law and Justice's rivals in a difficult situation. To begin with, they have to decide whether to run together in the general election.

The main opposition party, the center-right Civic Platform, led a coalition of anti-government forces in the elections for the European Parliament in May, a strategy that failed because the result was another strong victory by Law and Justice. Facing the general election in October, the Civic Platform and the rest of the opposition will have to decide whether they stand a better chance of defeating Law and Justice if they run separately. The fact that the opposition lacks a charismatic leader who could unite the anti-Law and Justice vote behind them complicates things further. More important, the opposition will struggle to find an attractive proposal to campaign on, as Law and Justice is already strong on issues such as welfare spending and national identity. The opposition will try to present itself as pro-European Union, as opposed to Law and Justice's Euroskeptic positions, but

this alone probably will not be enough to win the election.

Even if Law and Justice stays in power, it will face challenges of its own. The Polish economy is still expanding at a fast pace because of growing domestic demand, relatively low production costs and an attractive market for foreign investment.

But the economies of many of Poland's trade partners, particularly Germany, are slowing down, while Brexit creates significant uncertainty for companies and investors in Europe. This could make the government's high spending programs hard to sustain. On a longer timeframe, high rates of emigration and an aging population will also create labor shortages that will make it hard for Poland to continue growing at its current rates.

When it comes to foreign policy, Poland is unlikely to make any moves that would threaten its membership in the European Union. But Warsaw is also unlikely to make any moves to deepen its cooperation. As EU membership constantly forces states to decide between national sovereignty and federal integration, a new Law and Justice government is likely to continue prioritizing the former, which could lead to new disputes with the European Union's supranational institutions and potentially threaten its access to EU funds. Facing this dilemma, Law and Justice is likely to continue seeking the closest possible ties with the United States, which it sees as a counterbalance to its often-

GEOPOLITICS

tense relations with Brussels.

Romania: Turbulence Ahead On the surface, the presidential election should have a modest impact on Romania's domestic policies, because while the president has the power to veto legislation and conducts Romania's foreign policy, most policy issues are controlled by the prime minister and the Cabinet. But the presidential election happens at a time when the center-left government led by Prime Minister Viorica Dancila is in a fragile situation. In recent months, people have taken to the streets in Bucharest and other cities to protest reforms in the judiciary and the criminal code that they claim have weakened the fight against corruption. In May, the former leader of the governing Social Democratic Party (PSD), Liviu Dragnea, was jailed for corruption, and in

have run out of allies to remain in power. This will add to political uncertainty in Romania at a time when the country will be under growing pressure from the European Union to reduce its deficit. In recent years, Romania has sought to boost domestic consumption by increasing public spending and cutting taxes. But this effort has led to a higher deficit that, according to Romania's Fiscal Council, could breach the European Union's 3 percent of GDP threshold in 2019. The government insists that it will meet its target of a deficit of 2.7 percent of GDP this year, but to do so it may resort to unexpected tax hikes or one-off fiscal measures that could make the economic environment more uncertain for domestic and foreign companies operating in the country.

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THE EAST-WEST DIVIDE IN THE EU

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August the Alliance of Liberals and Democrats, the junior member of the ruling coalition, quit the government. This has left Dancila in charge of a minority government that could be ousted if there were a no-confidence motion against it.

To make things more complicated, Dancila plans to represent the PSD in the presidential election and has promised to resign if she doesn't make it to the second round. It's possible Dancila regrets this promise because opinion polls suggest she will not advance to the runoff election between the two top votegetters. Should the PSD perform poorly in the presidential election pressure on Dancila to resign will grow. The PSD may try to appoint a new prime minister and avoid a general election, but this could prove difficult considering that the party does not control a majority of seats in parliament and seems to

The upcoming elections in Poland and Romania will not drastically redefine their relations with the European Union.

However, a victory

by Law and Justice and prolonged political turbulence in Romania could make it harder for Warsaw and Bucharest to cooperate with Brussels and, more important, to comply with its demands on issues ranging from the rule of law to fiscal policy.

At the same time, some countries in Western Europe are increasingly willing to defend a twospeed approach to European integration. This approach already exists, as, for example, some EU members are part of the eurozone while others (like Poland and Romania) are not. But the EU's official goal is that all its members will eventually converge and that economic and institutional differences will be eroded. A combination of growing Euroskepticism, a weakening rule of law, lingering political instability and, in particular, what seems to be a mutual disappointment between the bloc's old and new member states could make the existing East-West divide within the European Union even broader.

REAL ESTATE

FORTE PARTNERS TO INVEST EUR 100 MILLION IN TWO OFFICE BUILDINGS IN CENTRAL BUCHAREST

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Forte Partners announces investments of around EUR 100 million in revitalizing the central area of Bucharest with two new office buildings, one of which has obtained BREEAM Excellent certification.

The Matei Millo project, worth EUR 40 million, was certified BREEAM Excellent with the highest score in Bucharest and the Tandem project, with a market value of EUR 65 million, are two office buildings that will revitalize and modernize the central area of Bucharest.

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“Work on the Matei Millo project, a ninestorey office building, was started in January 2019, and the decommissioning work on the old Tandem building was recently started,” said Geo Margescu, the CEO and co-founder of Forte Partners. “Matei Millo, a EUR 40 million office building, has received a BREEAM Excellent certification with a score of 83.2, the highest ever awarded for an office project in Bucharest. We want to develop sustainable, impactful projects that transform the city and shape the lives of those who work or live in them. In the development of Matei Millo and Tandem, we are taking into account all the characteristics of modern office buildings, including energy efficiency, concern for the local community and the well-being of the employees who will work there.”

Matei Millo and the Tandem building are part of the Sector 0 project, a Forte Partners initiative on the premium office segment.

Sector 0 involves the development of office buildings for creative communities – both companies and those who work on their own.

Sector 0 will demarcate an area of buildings perfectly integrated in the surrounding architectural style (art deco), in the vicinity of the representative building of the Palace of Phones.

As part of this initiative, the Matei Millo office building, with an art deco architecture that has been reinterpreted so as to integrate the project into the characteristic urban space of the area, whose main landmark is currently the Palace of Phones, will be delivered in the third quarter of 2020, while the Tandem project is due for completion in December 2021.

The BREEAM Excellent certification was

awarded to the Matei Millo building following an assessment based on ten criteria: Management, Health, Energy, Transport, Water consumption, Used materials, Waste, Land use & Ecology, Pollution and Innovation.

The Matei Millo office building has a total rentable area (GLA) of 9,000 square meters, a share of green spaces in the total area of common areas of over 30 percent, a height regime of 3S + GF + 9E, 130 parking spaces, and easy access to all means of public transport (buses, trolleybuses, metro).

Forte Partners obtained in June 2019 the LEED Platinum certification with a score of 84 for The Bridge 2 office building, which has been fully completed and leased. The first phase of The Bridge received a LEED Platinum certification with a score of 82.

Last year, in August, Forte Partners signed the full sale of The Bridge office project to Dedeman group, recording the most important real estate transaction of 2018. The first phase was leased in full to tenants such as BCR and IBM. The second phase, with a total rentable area of 21,000 square meters, is completed, fully rented and handed over to tenants, including companies such as UPC, Schlumberger and Medicover.

Forte Partners, founded in 2014, has so far developed a portfolio of projects worth over EUR 200 million, both in the office and residential sectors, and is developing projects worth another EUR 200 million. The company has developed the Stefan cel Mare Building and The Bridge 1, The Bridge 2 as well as the London 27 residential project and is currently developing the Aviation Park residential project, The Bridge 3 building and the Matei Millo and U-Center office projects.

ALPHA BANK 2019 ROMANIA CUP

HOPE, QUEBRAMAR AND ODESSOS 25 - WINNERS OF THE ALPHA BANK 2019 ROMANIA CUP

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The Alpha Bank 2019 Romania Cup ended after five regattas held over the course of three months, testing the endurance of the competitors, who had to overcome their own limits. The regattas took place at Eforie and Limanu Marinas, and included both longer, coastal-type races, which focus more on tactics and strategy, and short, inshore-type races, where the accent falls on maneuvers, with coordination and communication between crew members playing a vital role.

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navigator on Adria, runner-up in the ORC C This year's edition of the Romania Cup class, noted "that the community of yachting appreciated by several competitors as a very enthusiasts in Romania has seen a major balanced one included five regattas: Callatis, development recently, the crews are much Ziarul Financiar, Kaufland, Bricul Mircea and better trained, having invested in professional Poseidon, the last one being an international training programs, in equipment, in boats, in event organized in partnership with Balchik gadgets. They participated in many events Nautical Club. abroad and had The a first-hand competition was Alpha Bank Romania is a traditional experience of tight, according partner of sailing competitions, which their to the competitiveness. participants. Iulia are becoming increasingly popular.

And now, Fulicea, skipper Starting 2018, Alpha Bank has been people's of the Quebramar the official partner of the Romanian expectations boat, runner-up in have increased. the ORC A&B Yachting Federation, supporting both They want races class and winner the Alpha Bank Romania Cup and the that demand in the ORC A Alpha Bank National Championship, much more from class, said: "This the most important sailing competitions their boat, year was equipment, different, due to in Romania. training, the large number teamwork experience, and, why not, physical of very well trained crews participating in the endurance and intelligence." five events. It may sound like a clichĂŠ, but the Running over a period of three months, the competition has become much stronger, as Alpha Bank Romania Cup offered competitors many races had a tight finish, and the winners all kinds of conditions, with wind speeds were the crews that displayed the most ranging from six to 26 knots, sun and rain, so constant performance. Unlike the previous the regattas delivered an adrenaline boost to years, when one boat would clearly dominate all crews. The crew of Melx, the runner-up in the competition, this year there was a larger the ORC A class, was no exception. "We had a number of crews who fought hard until the good result in the first race, which increased end." our self-confidence, and encouraged us to put In turn, Anca Mure[an, tactician and

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Quebramar Crew

all our senses to work and to optimize both the boat and the roles of the crew. While last year the crew formed around Mihael Neagu and Claudiu Balcau with great difficulty, and the distribution of roles was relatively poor, this year the crew had to be analyzed, optimized and distributed, so that its members could reach their

Adria Crew Melx Crew

maximum efficiency and be able to cover others roles when needed," said Melx crew representatives.

FINAL RANKING ALPHA BANK 2019 ROMANIA CUP ORC A&B CLASS 1st place: Hope (skipper Mihai Făgără"an) 2nd place: Quebramar (skipper Iulia Fulicea) 3rd place: Incognito (skipper Bogdan Ion) ORC CLASS A 1st place: Quebramar (skipper Iulia Fulicea) 2nd place: Melx (skipper Mihael Neagu) 3rd place: LZ Yachting (skipper Lachezar Bratoev) ORC CLASS B 1st place: Hope (skipper Mihai Făgără"an) 2nd place: Incognito (skipper Bogdan Ion) 3rd place: Simina (skipper Cristian Ghelner) ORC CLASS C 1st place: Odessos 25 (skipper John Popescu) 2nd place: Adria (skipper Ion Popescu) 3rd place: Bonvi (skipper Cătălin Homeag)

special section

‘TOM & T-REX’ MB&F + L’EPEE 1839 FOR ONLY WATCH

How a Christmas Ornament With Chicken Legs Became a $25,000 MB&F Table Clock

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LIFESTYLE

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Only Watch, the world’s most high-profile charity watch auction, returns in 2019 in its eighth edition to continue raising awareness of Duchenne muscular dystrophy and pursuing a cure for this genetic disorder primarily affecting male children.

All previous MB&F Machines created for Only Watch were unique pieces from existing collections that incorporated visual elements related to the auction. For this 2019 edition of Only Watch, MB&F and L’Epée have made the unprecedented choice to contribute a previously unreleased piece, highlighting the special nature of the auction.

‘Tom & T-Rex’ will be the first – and a unique – example of the T-Rex clock co-created by MB&F and L’Epée 1839, which is planned for general release at the end of August 2019.

What sets ‘Tom & T-Rex’ apart from the main T-Rex collection to follow? A sculpture mounted atop the body of the hybrid beast, shaped like the figure of a young child. The rider of T-Rex – who MB&F and L’Epée have named Tom – is both companion and ward of his redoubtable steed.

Tom specifically represents the children living with the degenerative disease that is Duchenne muscular dystrophy, which causes the gradual loss of basic motor functions, including the ability to walk. Tom, who spends his waking days tethered to an unfavourable reality, has found in T-Rex a friend who can take him on adventures beyond his wildest dreams. Measuring only 4.3cm high, the sitting rider is less than a fifth as tall as the 26.5cm T-Rex; in real-life proportions, it could easily look right into the second floor of an average apartment block. Cross-legged in a particularly youthful, tranquil yet vulnerable pose, Tom stares down into a transparent blue marble of Murano glass nestled in his cupped hands, perhaps imagining a different world…

Children are capable of great imaginative feats, and especially so in the case of those limited by illness or disability. T-Rex

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offers an escape for elastic minds, carrying its little companions away into fantastical realms with the earth-shaking strides of the mightiest of dinosaurs, under the fierce protection of an all-seeing cyborg eye. Made of handblown Murano glass, the “eyeball” also functions as a clock dial, indicating hours and minutes via two curved hands driven from the centre of the hemitoroidal component. . A combination of sandblasted and polished surfaces directs the way that light interacts with the body of T-Rex, so that the clock seems light and agile, ready to run off with its diminutive passenger to a land where disease has ceased to exist.

TOM & T-REX: TECHNICAL SPECIFICATIONS ‘Tom & T-Rex’ is a unique piece created for the 2019 Only Watch charity auction.

A collection of T-Rex limited editions will follow in late August 2019.

Display Hours and minutes Size Dimensions: 308 mm tall x 258 mm x 178 mm Total components (movement + body): 201 Weight: approximately 2kg Body/frame Dial and marble: Murano hand-blown glass Materials: stainless steel, palladium-plated brass

and bronze Finishing: polishing, satin-finishing and sandblasting Body components: 63 Engine L’Epée 1839 movement, designed and manufactured in-house Balance frequency: 2.5 Hz / 18,000 vph Power reserve: 8 days Movement components: 138 Jewels: 17 Time setting: winding key to both set the time (in the centre of the dial) and wind the movement (on the barrel axis at the back)

Augustin watches:

Time becomes art

Augustin Matei deserves to be famous, as he is an endangered species: an artisan.

The idea is simple: you come with your wish or desire and he turns it into a watch.

The limit can only be the availability of components, because for his imagination – the sky is the limit.

And one more thing - it's affordable...

THE PROCESS OF MAKING My watches are born from an inspiration. Then comes the idea where it should start, the theme changes into a concept, and then into a concrete project and composition plan.

The dials are handmade in various artistic techniques such as microprinting, manual engraving, etc., so there are no two identical watches made, as there are no two identical persons in the world. Each watch reflects the customer’s character and desires, it resonate with

VORONET MONASTERY

SAINT GABRIEL

SKELETON CONCEPT

his soul and personality. Most of my watches have automatic Swiss mechanisms. They are made with different artistic expressions, textures, special colors, precious materials, some of them are quite different and atypical. I use almost pure silver, gold, stone, some models have even implemented pieces of meteorite, diamonds, pearls, volcanic rock or real lunar dust. Most of my works is one and only, provided with a certificate of authenticity and the limited series guarantee of a single, unique piece.

All my watch cases are made with

BATTLE OF TRAFALGAR

NAVAL BATTLE

JAPANESE EAGLE

BEETHOVEN

MINOTAUR

HUNTER DESIGN

sapphire glass and glass on backslide – the movement is visible through it.

In 100% of them I use automatic Swiss movement.

The straps are made from exotic leather materials and turn up with one additional strap.

The watches come with wooden hand made boxes (made from walnut or oak).

The most important in the creating process is the idea and concept for each one. They are inspired by the client’s passions, life stories or the most meaningful values. For each person a watch may be something different. For one an accessory, a jewel for other. For my clients it is often a very personal subject with a great emotional value, that reflects their personality. In my vision, a watch should not only be a part of beautiful look, which counts down the time, but above all, it should remind us about our life story and on what it is worth to spend the time that has been given to us.

LUXURY & LIFESTYLE - TOP BRAND

SPOTTED CRISTIANO RONALDO WITH A PAVED BREGUET DOUBLE TOURBILLON 5349PT Cristiano Ronaldo wearing a serious piece of horology, with a touch of bling and a price tag to match.

Cristiano Ronaldo is a Portuguese footballer who currently plays for the Turin-based club Juventus. He is also one of the most famous players on the planet alongside Argentinian player Lionel Messi of Barcelona. And as you can expect from him, he plays some serious “foot game”… but also some serious “wrist game”, as he’s been seen yesterday with “just” a paved, platinum Breguet Double Tourbillon ref. 5349PT.

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Recently, Cristiano Ronaldo – or CR7 for the fans – has sported a couple of complicated pieces, albeit adorned with extra bling. The first one was a Hublot MP09 Tourbillon Bi-Axial adorned with baguette diamonds on a rubber strap. The second was a GirardPerregaux Planetarium with tri-axial Tourbillon in rose gold. This watch was even more iced out than the first one, with the matching bracelet also featuring diamonds everywhere. It seems he does like watches that feature serious complications.

Yesterday Ronaldo launched his

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latest fragrance, “CR7 Play It Cool” in Turin, Italy.

He was sporting a new timepiece from Breguet for the event.

Which one you ask? It was a Classique

“Grande Complication” Double Tourbillon ref.

5349PT. It features a double tourbillion, which provides a focal point for the wearer and anybody looking at the watch. It also has the signature blued Breguet hour and minute hands. The watch has a 50mm platinum case adorned with 417 diamonds around the bezel, case, crown and the dial. It weighs 309 grams, so its not exactly lightweight even though its on a leather strap.

Powering the watch is the manually wound calibre 588, which has been beautifully hand engraved and can be admired through the sapphire caseback. It has a price tag of USD 802,000… Just that!

LUXURY & LIFESTYLE TOP BRAND

RICHARD MILLE INTRODUCES THE RM 57-03 TOURBILLON SAPPHIRE DRAGON A dragon sculpted in crystal.

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Most of Richard Mille’s recent – and bestselling – watches have mainly been ultralight and extremely technical in terms of materials and styling. The new RM 57-03 Tourbillon Sapphire Dragon is different. Instead it harks back to an earlier era of Richard Mille from not too long ago, when decorative techniques were employed to create unusually

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intricate watches like the Boucheron tourbillon.

Originally unveiled in 2012, the RM 57-01 was initially launched as the “Jackie Chan” edition, designed in collaboration with the Hong Kong action star and bearing a miniature dragon sculpture on the movement. Subsequent iterations included the RM 57-02 where the dragon was replaced by a falcon, a motif popular in the Gulf.

Available only in Asia, the RM 57-03 Tourbillon Sapphire Dragon is essentially a variant of the RM 57-01 the dragon executed in sapphire crystal and gold, the first time Richard Mille has created a sculpture in that material.

Produced by Olivier Vaucher, a microdecoration specialist in Geneva that serves

brands including Roger Dubuis, Van Cleef & Arpels and Zenith, the sapphire body of the dragon is first milled from a block of sapphire, and then laser engraved to create its detail.

Then the engraving is finished and polished by hand.

The sapphire pieces are then joined to solid red gold components that make up the dragon’s head, tail, limbs and spine. To highlight the dragon’s tongue and eyes, both are painted red with a tiny brush. And to match that, the endstone of the tourbillon is a large, round ruby in a rose gold chaton.

The watch is powered by the cal. RM 57-03, a variant of the hand-wound movement that is found in most Richard Mille tourbillons. It’s produced by Renaud & Papi, the complications workshop of Audemars Piguet. Here the movement base plate has been open-worked in a spiral pattern.

The watch pictured has a case made of NTPT

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Carbon, a carbon composite made by Swiss carbon specialist North Thin Ply Technology (NTPT). The layers of carbon inside create its distinctive grained appearance.

Other versions of the RM 57-01 will be produced, including five with a clear sapphire case.

Key facts Diameter: 42.7mm Height: 14.55mm Material: Carbon composite, or

THE VOUTILAINEN 28TI WRISTWATCH PERFECTLY ENCAPSULATES THE PHILOSOPHY OF KARI VOUTILAINEN

sapphire crystal Water-resistance: 50m Movement: RM 57-03 Functions: Hours and minutes Winding: Hand-wound Frequency: 21,600bph, or 3Hz Power reserve: 48 hours Strap: Rubber with folding clasp The RM 57-03 Tourbillon Sapphire Dragon is a limited edition of 55 watches, all available only at Richard Mille boutiques in Asia.

Within the 55 pieces there will be variations in case material as well as the style of the dragon inlay. Five of the watches will have a clear sapphire crystal case.

Prices are unavailable, but expect the base model in NTPT Carbon to start at approximately US$950,000.

Its elegant and strong mechanism is housed in a stylish and robust case.

The in-house movement of the Vingt-8 was designed, built, fabricated, finished and assembled in its entirety in Voutilainen workshops. The design and philosophy of the movement combines respect for longevity and precision with classical watchmaking tradition.

The movement has a very large balance wheel manufactured in-house, allowing perfect regulation of the watch to within strict tolerances.

To equip such an exceptional timepiece, a very rare and unique balance- spring system has been used. The exterior of the spring uses a typical Phillips overcoil, while the internal curve uses the little known Grossmann curve.

The escapement makes the movement very special; this is the first watch to have two escapement wheels in such a configuration. The escapement wheels give a direct impulse to the balance through the impulse roller/jewel. This escapement is extremely efficient and requires much less energy than traditional lever escapements, offering benefits in terms of longevity and stability in day-to-day use.

The balance-wheel bridge is sublimely elegant, offering an unimpeded view of the escapement and balance. It also allows the enthusiast to admire the extremely neat synchronized movements while watching the time.

The surfaces of pinions and wheels are completely flat and highly polished to within exceptionally uniform tolerances. All finishing work on the main plate and bridges is by hand to achieve the highest possible levels of surface finish.

Screws and all steel parts are finished and polished by hand.

The Voutilainen 28ti is limited to eight total pieces in titanium.

LUXURY & LIFESTYLE - TOP BRAND

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GREUBEL FORSEY WILL PRESENT THE NEW DOUBLE TOURBILLON 30° TECHNIQUE CERAMIC FOR THE FIRST TIME AT WATCHTIME NEW YORK 2019

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The Double Tourbillon 30º is one of the most important timepieces in the Greubel Forsey catalog. As the first timepiece unveiled by the manufacture at Baselworld 2004 — after five years of development

by Stephen Forsey and Robert Greubel — it set in motion all of the success and innovations that Greubel Forsey has accomplished in the 15 years since. However, it was only seven years after the Double Tourbillon 30º appeared that it received its first significant update with the Double Tourbillon 30º Technique, a watch that reconstructed the movement of the now well-known timepiece in a way that the wearer could observe its movement parts with an as unobstructed view as possible.

The Double Tourbillon 30º Technique ended up being another major success for the young brand, claiming first prize at the Concours International de Chronométrie, where it achieved a record score of

915 points out of 1000 with an average timing rate of between 0.3 and 0.8 seconds per day, as well as taking home the Complicated Watch Prize at the GPHG in 2009. In 2010, a different version of the watch, the Double Tourbillon 30º Historique, took home the prestigious Aiguille d’Or at that year’s GPHG. So what makes the Double Tourbillon 30º so worthy of acclaim? As the first of Greubel Forsey’s proprietary “Inventions,” it approached the concept of a tourbillon as a regulating device in an inherently different way. Basically, a single 60-second tourbillon inclined at a 30º angle is surrouned by an outer tourbillon that makes its own rotation every four minutes. (The two tourbillon cages combined account for 132 of the movement’s 421 total parts.) In effect, this averages out positional errors brought on by effects of gravity on the watch’s oscillator to a much higher degree than typically seen on a tourbillonenhanced timepiece. The manually wound, manufacture movement features four coaxial barrels that are coupled to a spherical power-reserve differential, providing running autonomy up to 120 hours when fully wound.

What we have today is a brand new take on the Double Tourbillon 30º Technique. For the first time in the brand’s short history, it has applied ceramic to a watch’s case (previous limited runs of the timepiece were offered in rose gold, white gold, platinum, titanium, and, memorably, sapphire crystal). While ceramic might be the most identifiable aesthetic update, there are a number of firsts within the movement construction as well.

The last version of the Double Tourbillon 30º Technique was released with a sapphire crystal case, but the movement featured an almost identical construction to its precious-metal predecessors. While today’s release features the equally modern ceramic case, its movement architecture is has now received a sapphire crystal update.

THIS FALL'S WARDROBE FOR MODERN BUSINESS MEN

O UTFIT: TRENDS P HOTOS

BY

BY

A DINA B UZATU

VALI B ARBULESCU

M ODEL : I ULIAN D AMASCHIN Love it or not, autumn is back in town and it’s pushing you to make some changes in your lifestyle, including your wardrobe. Since your daily routine involves working in an office or meeting with clients, you need to rely on your suit for the best first impression. Now it’s time to make the switch form summer suits to autumn versions, following some classic rules and some new trends.

YOUR COMFORT ZONE IN WOOL Summer days are gone and so are linen and cotton suits, airy cloth shirts or any other garment in breathable fabric. Your office wardrobe needs a reset in order to keep you stylish and comfortable. And the key word for this season is “wool”.

Whether it is a two button suit to slim your profile, or a double breasted coat, this fall’s clothing items are made of 100 percent fine wool, with a soft feel. As the power of a business suit lays in details, the quality of the fabric, the cut and the perfect fit are crucial for a successful fall look. And our TRENDS by Adina Buzatu fall collection proves it!

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BLUE IS THE NEW BLACK

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In terms of colors, black will always be the beloved classic, but blue seems to be the star of this season. The navy suit from the famous international brand Lords & Fools is your go-to option for office and business meetings, which you can pair with an oxford shirt and some brown or oxblood oxford shoes, for that safe, classic approach with a twist. The navy blazer is still on your list of choices for office and leisure, this time in thick wool.

Mix it with classic suit trousers and a striped vest in a three piece suit on the spot.

Go on the safe path with a light blue shirt and double monk strap shoes in matching tones. Nobody will judge you for being conservative, but they’ll adore the mixing shades of blue. The navy blazer is a solid choice for this autumn, not only in terms of color, but for its style, too. Feel free to throw it over your favorite casual combo and you’ll get an 80 percent sharper look.

OPPOSITES ATTRACT This season, blue in checks is checkmating the opponent formal suits. Inject some personality into your office attire with a petrol blue checked suit and contrasting accessories.

If you’re not into an adventurous mood, keep everything else simple and let the pattern do the talking. Mixing contrasting colors works great not only in this game with accessories, but also with the main pieces. Put together a jacket in a rich shade of bordeaux with a dark purple pants and a white shirt for an eye-catching contrast.

CLASSY ALL BLACK Black will always be a refined option and the modern gentleman makes the maximum use of it. Go for a cozy and stylish all-black outfit for a night out. Pair dark jeans with a merino wool V-neck sweater and a double breasted wool coat. Chelsea boots are the appropriate footwear option.

SMART BOOTS FOR SMART GUYS The key to a successful office wardrobe lays in accessories, and a good pair of shoes has the power to change the entire outfit. Complete your autumn outfits with some smart and stylish shoes and boots. Pairs of well-built brogues, derby shoes and Chelsea boots are your smart choices. Add them on your shoe rack so you have an option for every clothing combo. Matte black leather, rich tan or chocolate brown are this fall favorite colors. TRENDS by Adina Buzatu’s fall wardrobe for the modern business man is built on a solid foundation of fabrics, colors and cuts. Pure wool in black, dark blue, brown and burgundy treated with sartorial excellence are meant to add a refined touch to your office attire.

We are waiting for you in our TRENDS by Adina Buzatu shop in Baneasa Shopping City, Road Bucharest-Ploiesti no. 42 D, ground floor and on www.adinabuzatu.ro

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JEEP'S NEW MODELS LIVE UP TO THEIR OFF-ROAD PEDIGREE 54http://www.business-arena.ro

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Business Arena was invited to Jeep Adventure Day to put to the test the American carmaker's model lineup. The event, hosted by TCS Racing Park at Ciolpani, was open to journalists and customers alike, and included an obstacle track that allowed guests to have a taste of Jeep's off-road prowess.

For our colleagues, Paul Madrio and Cosmin Stangaciu, it was a truly fantastic experience that involved tackling 30-degree climbing gradients, 35degree descends and 25-degree lateral inclines, water crossings, and balancing on two wheels. Our hosts provided several models in various trim levels and engine sizes, including the Renegade, the Compass, and the Wrangler, and each and every one of them showed excellent off-roading abilities, handling beautifully everything that was thrown at them.

Despite their lower ground clearance when compared to the Wrangler, the Renegade and Compass proved very capable at dealing with the intense hurdles they were put through. In turn, the short-base Wrangler was a Sahara-trim model using road tires. Even so, both the short- and the long-base Wrangler models displayed an impressive performance.

At the end of an exciting day, our colleagues declared themselves absolutely thrilled with their experience on the off-road track.

AUTO

FERRARI 812 GTS

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Exactly 50 years on from the debut of the last spider in the Ferrari range to sport a front-mounted V12, the Ferrari 812 GTS hails a triumphant return for a model type that has played a pivotal role in the marque's history since its foundation.

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The Ferrari V12 spider story features many iconic models and began in 1948 with the 166 MM, an authentic thoroughbred competition GT that won the two most prestigious endurance races in the world in 1949: the Mille Miglia and the 24 Hours of Le Mans.

The last in that long lineage was the 1969 365 GTS4, also known as the Daytona Spider because of Ferrari's legendary victory in the 1967 24 Hours of Daytona when two works 330 P4s and the NART-entered 412 P took the chequered flag side-by-side to occupy the top three places.

The front-mounted V12 architecture has not been used in a Ferrari series-production spider since the 365 GTS4. That said, four special series limited editions have been launched: the 550 Barchetta Pininfarina in 2000, the Superamerica in 2005, the SA Aperta in 2010 and, most recently, the F60 America of which just 10 were built to celebrate Ferrari's 60th year on the American market in 2014.

Like its historic predecessors, the 812 GTS sets a new benchmark in terms of performance and exclusivity. Sporting Ferrari's majestic 800 cv V12, it is not merely the most powerful production spider on the market, but also the most versatile, thanks to its retractable hard top, a unique feature in this segment which also guarantees a larger boot capacity.

The retractable hard top (RHT), which opens in just 14 seconds at speeds of up to 45 km/h,

does not impinge upon the interior dimensions, thus maintaining the donor car's roomy cockpit. The electric rear screen, which acts as a wind-stop, makes the car truly useable with the top down while, with the top up, it can be left open to allow occupants to continue to luxuriate in the naturally-aspirated V12's unique soundtrack.

ENGINE The Ferrari 812 GTS is the spider version of the 812 Superfast, from which it takes both its specifications and performance, most notably the power unit which, thanks to its ability to unleash a massive 800 cv at 8500 rpm, is the most powerful engine in its class. 718 Nm of torque guarantees impressive acceleration virtually on a par with that of the 812 Superfast while the heady 8900 rpm rev limit means that sporty driving is undiminished.

As on the 812 Superfast, these performance levels were achieved in part by optimising the engine design and in part by innovations, such as the use of a 350 bar direct injection system, and the control system for the variable geometry inlet tracts, developed on naturally-aspirated F1 engines. These systems allowed the increase in displacement from 6.2 to 6.5 litres to be exploited to maximise power output whilst retaining

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excellent pick-up even at low revs. The high pressure injection system also improves nebulisation of the injected fuel thus dramatically reducing the amount of particulates emitted when the catalytic converter is warming up, and the fitment of a Gasoline Particulate Filter (GPF) together with the Stop&Start On the Move strategy, which cuts and restart the engine while the car is on the move, ensures the engine complies with all emissions regulations.

Particular attention was also paid to calibrating the Manettino settings to enhance the engine's potential and the sensation of extreme power delivered by the car. That said, the driver will always be able to easily and confidently dose the massive torque available with the accelerator pedal,

thanks to smooth, progressive power delivery at all engine speeds. The shape of the torque curve reveals that torque distribution was not sacrificed to boost power. A significant 80% of maximum torque is available at just 3500 rpm, improving both flexibility and pick-up at lower revs.

The shape of the power curve, which rises constantly all the way to the maximum revs of 8500 rpm, and the rapidity with which engine speed increases, thanks to low inertia, give occupants the feeling of boundless power and acceleration. The latter sensation comes courtesy of the overall increase in maximum power output and the optimisation of the aforementioned power curve between 6500 and 8900 rpm, which maximises the average horse power exploitable for press-on track driving when engine revs are kept consistently high.

DESIGN Designed by the Ferrari Styling Centre and based on the 812 Superfast, the 812 GTS echoes the formal language and proportions of Ferrari's frontengined V12 without altering either its exterior dimensions or interior space and comfort, so it represents the perfect marriage of sportiness and elegance. From the side view the 812 GTS has a fastback sleekness: a two-box design with a high tail reminiscent of the glorious 365 GTB4 (Daytona) of 1968. The draped design of the flanks visually shortens the tail and is characterised by sharply slanted crease lines and impressively muscular wheelarches that imbue it with the power and aggression warranted by its imposing V12.

On the spider version of the 812 Superfast, the entire rear of the car - roof, tonneau cover and luggage compartment - has been redesigned. The idea was to lend the car a new blend of sleekness and balance, thanks to two buttresses beneath which the roof movement mechanism is stowed. The buttresses were designed to visually embody a sense of forward thrust and lend the side windows a signature look that would set the spider apart from the berlinetta. When the top is dropped, the roof panels disappear beneath the aforementioned tonneau cover. Aerodynamically, the 812 GTS posed two main challenges for the Ferrari designers: how to guarantee the same performance as the coupĂŠ version with the top up and, at the same time, ensure maximum passenger comfort with the roof down.

VEHICLE DYNAMICS The aim in developing the 812 GTS was to retain the exhilarating feeling of speed and power delivered by the berlinetta version in terms of accelerating, response times and agility. The Ferrari 812 GTS is equipped with all of the 812 Superfast's new generation components and control systems and, like it, delivers impressive handling. It sports Electric Power Steering (EPS) which, in line with Ferrari tradition, is used to fully exploit the potential of the car in terms of performance by integrating it with all of the electronic vehicle dynamics controls, including Version 5.0 of Ferrari's patented SSC. Another of the integrated systems is the Virtual Short Wheelbase 2.0 system (PCV), which has been further evolved based on experience gained since its debut on the F12tdf.

AUTO

ŠKODA ADDS FRESH APPEAL WITH NEW TRIM LEVEL

Czech car maker Škoda has been busy working on its model lineup in the run-up to the 2019 Frankfurt Motor Show, and announced the debut of the Monte Carlo sporty, lifestyle-oriented trim level on two of its models, the Kamiq and Scala. There's been more good news for Škoda fans, as the company said the Kamiq scored maximum five stars in the Euro NCAP test.

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City SUV meets rally history

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The Kamiq receives the Monte Carlo trim level in line with tradition, evoking the brand’s successful rally history and also featuring an upgraded level of equipment.

The company points out that the new top trim level for the Kamiq can be combined with all the engines available for the model series, while deliveries will start in the fourth quarter of 2019.

Oliver Stefani, Head of Škoda Design, says: “The new Škoda Kamiq is a typical Škoda SUV that develops its own distinctive personality through design elements like the split headlights.

The black Monte Carlo features emphasize this independent character and make it an even more attractive proposition for a younger target group. What you have here is a perfect combination of a sporty design referencing our successful rally vehicles and the everyday usability of a smart city SUV.” The new Kamiq is the second SUV in the brand’s history to come with a sporty Monte Carlo version, having been preceded by the Yeti.

According to the company, the Monte Carlo name is used to identify the sporty lifestyle versions of Škoda’s compact models. It evokes the splendor and glamour of the Principality of Monaco as well as the storied motor racing history of the Monte Carlo Rally, an event that dates back to 1911 and has seen many Škoda successes over the years. The manufacturer’s first model to bear the Monte Carlo name was a 1936 limited edition of the Škoda Popular.

Black Monte Carlo features communicate sportiness In addition to the characteristic split full-LED headlights, the Kamiq Monte Carlo comes with a glossy black frame surrounding the Škoda grille, for a dynamic and distinctive appearance.

The black detailing also extends to parts of the front bumper, the wing mirror caps, roof rails, side sills and the centrally positioned Škoda

lettering on the tailgate. The trim level features black 17-inch alloy wheels with a Monte Carlo design as standard; 18-inch alloys are available as an option. It also includes SunSet tinted side windows and a panoramic roof. A black rear diffuser, black model designations and full-LED tail lights round off the sporty appearance of the new Kamiq range-topper, which can also be identified by a special badge.

Dynamic interior accents The interior of the Kamiq Monte Carlo welcomes the driver and front passenger with height-adjustable sports seats featuring a specific Monte Carlo design and integrated headrests. The multifunction sports steering wheel is covered in perforated leather bearing the same red decorative seams as the leather finish for the gear selector and handbrake lever.

The LED ambient lighting also comes in red and illuminates the centre console, door storage compartments, door handles and footwells. The Kamiq Monte Carlo also includes LED reading lights. The decorative trims and instrument panel have their own standalone design, with the air vents in the dashboard sporting a chrome look and the pedal trim featuring an aluminum design. Special floor mats, Kamiq lettering on the door sills and a black roof lining complete the interior.

The Kamiq wins top safety rating Apart from a stylish new trim level, the Kamiq has also received a maximum five stars in its test by the independent European New Car Assessment Program (Euro NCAP). This makes the car maker’s first city SUV yet another model to be counted among the safest vehicles in its class. The Kamiq did particularly well in terms of protecting adult occupants and cyclists.

Christian Strube, Škoda Auto Board Member for Technical Development, explains: “The active and passive safety of our vehicles is a top

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priority for Škoda. The fact that the Kamiq, our latest model, has now received another maximum five-star score in the Euro NCAP crash test shows what a high bar we have set ourselves for the safety of our vehicles and provides another demonstration of how successful our engineering work is in this area.”

Škoda Scala Monte Carlo: New trim level for even more dynamic and lifestyle appeal Industry insiders and the general public will also be able to experience the new Škoda Scala Monte Carlo for the first time at the 2019 Frankfurt Motor Show.

Oliver Stefani, Head of Škoda Design, underscores, “With the new Monte Carlo version, we are putting even greater emphasis on the Škoda Scala’s sporty and dynamic character. The black Monte Carlo features, large alloy wheels and the storied name establish a link with our successful rally vehicles and are even more specifically designed for a younger target audience which appreciates sportiness and an emotive, lifestyle-focused design.”

Sporty design and eye-catching black elements Numerous black elements lend the dynamic Scala Monte Carlo an even sportier presence. The frame of the distinctive Škoda grille flanked by full-LED headlights is finished in glossy black, and parts of the redesigned front apron also come in black. The Škoda lettering taking the place of the central Škoda logo on the tailgate - the Scala was the first European Škoda production model to introduce this feature - is another element which comes in black in the Scala Monte Carlo. The model’s side view is defined by black 17inch alloy wheels (18-inch optional) with a special Monte Carlo design, as well as black wing mirror caps and side sills. Standard equipment, which is available with any engine from the model series roster, includes SunSet tinted side windows as well as a panoramic roof and extended rear window complete with a black roof spoiler. A black rear diffuser and black model designations as well as full-LED tail lights round off the sporty appearance of the new Scala range-topper, which can also be identified by a special badge.

Sports seats and leather applications for a sophisticated interior The interior design radiates sporting appeal. The height-adjustable sports seats come with integrated headrests and special Monte Carlo upholstery, and the decorative trims and instrument cluster likewise feature a standalone design. The multifunction sports steering wheel is covered in perforated leather bearing the same red decorative seams as the leather finish for the gear selector and handbrake lever. Another red accent comes in the shape of the LED ambient lighting illuminating the centre console, footwells and door storage compartments and handles. The air vents in the instrument panel impress with a chrome look, and the trim level also includes LED reading lights.

Pedal trim with an aluminum design, special floor mats, Scala lettering on the door sills and a black roof lining round off the sporty interior ambiance.

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