Radio România Internațional

Tag: GDP

  • October 20, 2017 UPDATE

    October 20, 2017 UPDATE

    DEFENCE Romanian Defence Minister, Mihai Fifor said in Krakow on Friday that it was time for Romania and Poland to step up their cooperation including in the field of defence. The Romanian official made the statement during a meeting he had with members of the Romanian community and Polish students who are studying Romanian at the Jagiellonian University. Fifor underlined the old friendship relation between the two countries and their very good cooperation inside the Strategic Partnership. On Thursday, the Romanian Minister participated in the inauguration of the NATO Counterintelligence Center of Excellence together with his counterparts from Poland, Slovakia and Hungary. On this occasion, Fifor said Romania had supported the project of setting up this centre from the very beginning, as this institution is needed for the training of NATO experts in the field. During his visit to Poland, the Romanian official has also met Romanian officers deployed to this country as part of the US-led NATO Battle Group for the period September 2017 — March 2018.




    SUMMIT The European Council president Donald Tusk announced on Friday, the last day of the Brussels summit, the beginning of the interior procedure for the second phase of the Brexit negotiations with Britain’s representatives. Romanian president Klaus Iohannis said after the summit that the message conveyed by the EU leaders was a positive one, as they want to create ‘a better Union closer to the citizen.’ Asked by the journalists what he thought about the fact that British Prime Minister Theresa May had admitted that talks with the EU had reached a deadlock, the Romanian official said that nobody was trying to halt the negotiations, but there was no guarantee that headway would be made until December this year. The Romanian president said that the latest European Council session also included talks on migration, which in his opinion, was the first in a positive and optimistic tone. Iohannis added that this summer saw an increased number of migrants coming via the Black Sea without this being a mass phenomenon. Iohannis announced that Romania had decided together with the countries participating in the summit to back the Nuclear Agreement with Iran. The EU’s digital agenda, security and defence, the EU’s relations with Turkey and North Korea’s nuclear programme were also discussed during the summit.




    MIGRATION 28 citizens from Afghanistan, India, Iran and Iraq have been stopped by border police at Romania’s border with Hungary. The group was made up of nine women, eight men and eleven minors with ages between one and 17 years. All of them were asylum-seekers who said their intention was to cross the border into Hungary in order to make it to countries in Western Europe. The perpetrators are to be investigated for illegal entry and if found guilty legal measures are to be taken against them. Over 1000 migrants have been trying to cross Romania’s border into Hungary since the beginning of the year.



    GROWTH According to a World Bank report Romania’s economy is to register unexpected growth in 2017 and 2018. The country’s GDP will supposedly rise by 5.5% this year thanks to the fiscal incentives and the improved European economy. Increased consumption will also lead to a current account deficit as well as inflation estimated at 2% at the end of this year. The report also says that Romania’s GDP will rise by 4.1% in 2018 and 3.6% in the following year. The World Bank cautions against accumulated fiscal pressure and excessive domestic demand, which could make Romania’s economy vulnerable to shocks also limiting the authorities’ future actions.



  • September 5, 2017

    September 5, 2017

    Economic growth — Romanian’s Gross Domestic Product went up by 5.8% in the first half of the year as against the same period of 2016, Romania’s National Statistic Institute has announced. All economic sectors have contributed to the growth, except for constructions. Industry, trade, transportation, tourism and the IT&C sectors have contributed most to the growth. According to Romanian PM Mihai Tudose, the 5.8% economic growth rate, the biggest in Europe, is the best indicator of how the country’s real economy stands.




    North Korea – The UN Security Council is this week discussing a resolution in response to North Korea’s having conducted a nuclear test at the end of last week, its sixth so far. North Korea said its test of what it described as a hydrogen bomb designed for a long-range missile was “a perfect success.” The UN Security Council strongly condemned North Koreas “outrageous” test, saying is “deliberately undermining regional peace and stability”. US Ambassador to the United Nations Nikki Haley said Monday that North Korean leader Kim Jong Un was “begging for war” as she urged the UN Security Council to adopt the strongest sanctions possible to stop Pyongyangs nuclear program. Speaking at a Security Council emergency meeting, Nikki Haley said North Koreas sixth nuclear test was a clear sign that “the time for half measures” from the UN had to end. The Council will take a decision on Monday.




    Enescu Festival — The “George Enescu” International Festival, one of the most prestigious music events in Europe, continues in Bucharest. The Russian National Orchestra is today holding a concert as part of the Great Orchestras of the World series. Also today, soloist Madalina Pasol is performing alongside Radio Romania’s Chamber Orchestra, under the baton of Tiberiu Oprea. For 3 weeks, 80 concerts and other events will bring more than 3,000 of the best international artists to Bucharest and 7 other major Romanian cities. Radio Romania is the only media institution in the country to broadcast the concerts live, on its channels Radio Romania Music and Radio Romania Culture. First organised in 1958, 3 years after the famed Romanian composer had died, the George Enescu Festival was discontinued in 1971 by the communist regime, and was resumed in 1989. It has been held every 2 years ever since.




    US Open — Romania only has one player left at US Open, the last grand slam of the year. Horia Tecau is today playing in the quarterfinals in both the men’s doubles alongside Jean Julien Rojer and in the mixed doubles alongside the American Coco Vandeweghe. On Monday Romanian Monica Niculescu and Wei Hsieh of Taiwan failed to qualify to the women’s doubles quarterfinals.




    Football –Romania’s national football team was defeated by Montenegro on Monday 1-0 in Podgorica, in Group E of the World Cup qualifiers, losing any chance to qualify to the final tournament in Russia. Romania ranks fourth in the group, after Poland, Denmark and Montenegro. Romania’s next fixture against Kazakhstan will be held on home turf in the town of Ploiesti on October 5th while the one against Denmark will be held on November 8th in Copenhagen. The manager of the Romanian national team, the German Christoph Daum, has been strongly criticised for the team’s poor results.


    (Translated by Elena Enache)

  • Economic Developments in Romania

    Economic Developments in Romania

    The IMF forecasts a 4.2% growth of Romania’s economy for 2017 and encourages the Romanian authorities to keep up the pace of the anti-corruption fight. In its Thursday’s report, the IMF hails the progress made by Romania in reducing economic imbalances after the global financial crisis, but it recommends a reorientation of policies from boosting consumption to supporting investments.



    As regards risks, the IMF underlines that the unitary pay bill, the increase in pensions and the new tax cuts could negatively affect the budget deficit, that could reach this year 3.7% of the GDP to further increase to 3.9% in 2018. In order to prevent the increase in deficits from endangering fiscal stability, the IMF recommends economic consolidation on medium term, supported by reforms that should boost the efficiency of the public sector. Also, a potential relaxation of fiscal prudence might negatively affect market confidence, and this risk, cumulated with an increase in political tensions, might affect consumption and investments, increase loan costs and put pressure on the currency exchange rate.



    On the other hand, upon the presentation of the report on financial stability in 2017, the governor of the National Bank of Romania, Mugur Isărescu, said that a fast economic growth, as has been reported in Romania over the past months, even in a stable macroeconomic context, could equally imply growth risks. The governor explained that the central bank had the duty to pay attention to these risks and make them public, in order to diminish possible negative outcomes and avoid worrying the population.



    Mugur Isărescu: “The fact that risks are reduced should not lead to the conclusion that ‘the national bank was wrong when it communicated a risk potential’. We do not intend to show that we are always right and bad things should happen. It is not our purpose and we don’t intend to scare the people. This is a European practice, because, in a sophisticated world, with sophisticated financial institutions risks are inherent.”



    The vice-governor of the national bank, Liviu Voinea, says that, in comparison with the previous report, financial stability has remained robust in Romania, and risks have diminished in intensity and number, but have nevertheless diversified.



    Liviu Voinea: “We consider that we are facing a potential, high systemic risk which is an external risk, but its evolution is slower than in the previous months. This risk refers to a rapid deterioration of investors’ trust in emerging economies. We have also identified three moderate risks, which are internal risks, namely tensed macroeconomic balances, the risk of maintaining a modest evolution of lending activities in the sector of non-financial companies and the legal framework in the financial and banking field.”



    Liviu Voinea also said that a recently emerged risk, which is low for the moment, is that of an increase in real estate prices.


    (Translated by Lacramioara Simion)

  • Economic Developments in Romania

    Economic Developments in Romania

    The IMF forecasts a 4.2% growth of Romania’s economy for 2017 and encourages the Romanian authorities to keep up the pace of the anti-corruption fight. In its Thursday’s report, the IMF hails the progress made by Romania in reducing economic imbalances after the global financial crisis, but it recommends a reorientation of policies from boosting consumption to supporting investments.



    As regards risks, the IMF underlines that the unitary pay bill, the increase in pensions and the new tax cuts could negatively affect the budget deficit, that could reach this year 3.7% of the GDP to further increase to 3.9% in 2018. In order to prevent the increase in deficits from endangering fiscal stability, the IMF recommends economic consolidation on medium term, supported by reforms that should boost the efficiency of the public sector. Also, a potential relaxation of fiscal prudence might negatively affect market confidence, and this risk, cumulated with an increase in political tensions, might affect consumption and investments, increase loan costs and put pressure on the currency exchange rate.



    On the other hand, upon the presentation of the report on financial stability in 2017, the governor of the National Bank of Romania, Mugur Isărescu, said that a fast economic growth, as has been reported in Romania over the past months, even in a stable macroeconomic context, could equally imply growth risks. The governor explained that the central bank had the duty to pay attention to these risks and make them public, in order to diminish possible negative outcomes and avoid worrying the population.



    Mugur Isărescu: “The fact that risks are reduced should not lead to the conclusion that ‘the national bank was wrong when it communicated a risk potential’. We do not intend to show that we are always right and bad things should happen. It is not our purpose and we don’t intend to scare the people. This is a European practice, because, in a sophisticated world, with sophisticated financial institutions risks are inherent.”



    The vice-governor of the national bank, Liviu Voinea, says that, in comparison with the previous report, financial stability has remained robust in Romania, and risks have diminished in intensity and number, but have nevertheless diversified.



    Liviu Voinea: “We consider that we are facing a potential, high systemic risk which is an external risk, but its evolution is slower than in the previous months. This risk refers to a rapid deterioration of investors’ trust in emerging economies. We have also identified three moderate risks, which are internal risks, namely tensed macroeconomic balances, the risk of maintaining a modest evolution of lending activities in the sector of non-financial companies and the legal framework in the financial and banking field.”



    Liviu Voinea also said that a recently emerged risk, which is low for the moment, is that of an increase in real estate prices.


    (Translated by Lacramioara Simion)

  • Money for the Romanian Army

    Money for the Romanian Army

    The Romanian Army will get half of the 2% of the GDP allocated for the first time this year to defense, which it will use to modernize its equipment. The equipment modernization plan will be finalized within a month, the Romanian Defense Minister Gabriel Leş stated on Radio Romania. According to the Defense Minister, the army will get attack and transport helicopters as well as new armored vehicles, given that the ones the army are using right now are 30 years old.



    Here is Minister Gabriel Leş: “Our intention is to equip the army with attack helicopters, so that when the helicopters that we have now have exhausted their resources, we will be able to use these new helicopters. We are now considering attack helicopters in particular, but also transport helicopters, which will be probably covered by the next stage of the army equipment modernization program.”



    The Romanian Defense Ministry would like to have the national defense industry involved in all the programs aimed at equipping the Romanian Army.



    In another move, Minister Leş has stated on Radio Romania that the NATO multi-national brigade in Craiova, southern Romania, will be rendered operational this month, and the Southeast Division, whose headquarters are based in Bucharest, will become operational next year. In 2017, several large-scale military exercises will be held on Romanian soil. The most important of them will entail the participation of 20,000 soldiers from NATO member countries, Gabriel Leş has also said. Some of the drills will be bilateral, headed by the US, and the others multi-national. They are all aimed at enhancing the interoperability of the allied forces and increasing the quality of military operations under a single command, said minister Leş, who also stressed the fact that all the exercises to be carried out in Romania are purely defensive.



    Romania, a NATO member since 2004, marked NATO Day on the first Sunday in April. Bucharest authorities took the opportunity to highlight the fact that Romania will keep on consolidating its strategic profile within the Alliance and will fully observe its commitments. “NATO’s collective defense means today, more than ever before, being aware of the fact that the security of every state can be more efficiently protected if the members act together, and not separately” Romania’s President Klaus Iohannis said on the occasion.


  • Romania’s budget deficit in the focus of the European Commission

    Romania’s budget deficit in the focus of the European Commission

    The European Commission warns that Romania might report the biggest budget deficit growth within the EU this year, despite the fact that it registered the biggest economic growth rate in Europe in 2016. The head of the European Commission Representation in Romania, Angela Cristea, pointed out, at the launch of the economic report for Romania, that the document signals a number of paradoxes related to Romania’s economic evolution.



    Angela Cristea: “On the one hand, the poverty rate in Romania has dropped, but social inequalities have grown. Also, the document shows the biggest growth of income inequalities within the EU in Romania. And we notice that this is not one single occurrence, there has been a tendency for income inequalities since 2012. Actually, this tendency has also been reported in other EU member states and we believe that it reflects the global effects of a crisis complicated by the effects of globalization.”



    The EC estimates that Romania will end the year with a deficit of 3.6% of the GDP, the biggest in the EU. Finance Minister, Viorel Ştefan, said Romania reported good economic results, adding that the EC’s concerns are carefully followed by the government.



    Viorel Stefan: “Romania has made progress in terms of structural reforms, especially as regards governance, employment and the reduction of poverty, healthcare and public administration. I would like to point out that, in 2016, Romania was included in the category of states without macroeconomic imbalances alongside Austria, Belgium, Estonia, Hungary and Great Britain. The government has reiterated its commitment to maintaining the budget deficit within the limits set under the Stability and Growth Pact and it intends to take further measures to reduce spending, if it notices potential failure to reach the targets set for the first quarter.”



    Viorel Ştefan has also said that the government wants to streamline and improve control actions with a view to increasing the rate of tax collection to the budget. As regards the evolution of the Romanian economy, the chief economist of the national bank, Valentin Lazea, says that in order to have potential growth of the GDP close to 5% annually, which is the necessary level to help Romania bridge the gaps separating it from the European developed countries, we should implement structural reforms in the education and healthcare sectors and also improve demographic conditions. Furthermore, Romania needs to increase the absorption rate for European funds and make public investments efficient.


  • March 7, 2017

    March 7, 2017

    STATISTICS — Romanias GDP in 2016 went up 4.8% against 2015, according to preliminary data published by the National Institute of Statistics. The estimated GDP for 2016 was over 759 billion lei, approximately 169 billion Euro, as compared to 160 billion in 2015. All branches of the economy contributed to the growth in 2016, except for agriculture and construction, which stagnated. The economy was principally driven by consumption. For 2017, the European Commission estimates growth to be 4.4%, with a slowdown to 3.7% in 2018. The IMF expects the GDP in 2017 to be 3.8%, the highest rate of growth expected in Europe. This years national budget is based on an expected growth of 5.2% of the GDP.



    REVIEW — Romanias General Prosecutor, Augustin Lazar, presented the general review of activity for last year, declaring that 2016 was a year with considerable results in judicial activity, considering the legislative instability in the country. In his opinion, the Public Ministry fulfilled its important mission in the institutional architecture of the rule of law. The General Prosecutor said that the institutional approach of his office is based on the National Defense Strategy for 2015-2019, as well as the National Anti-corruption Strategy and the National Strategy for the Reform of the Judiciary 2015-2020. For this year, he said, priorities will be mainly fighting corruption and tax evasion, fighting against environmental violations, especially in forestry, as well as violations regarding the national heritage. The event was attended by President Klaus Iohannis, who said Romania has made significant progress in terms of the justice system, but that it still awaits the final results of investigations into the 1989 Revolution and the miners raids of the early 1990s.



    POLICE — In Bucharest today, police union representatives hold a new round of discussions regarding the Unitary Salary Law, attended by Interior Minister Carmen Dan, and Finance Minister Viorel Stefan. Yesterday, police unions negotiated the law with Labor Minister Lia Olguta Vasilescu, but said they did not reach a conclusion, announcing protests for mid-March. Their main complaint is that incentives are not calculated based on the present minimum wage of around 320 Euro, but on the minimum wage as it stood in December. Interior Minister Vasilescu said that the Unitary Salary Law will be ready in July, as provided by the government platform.



    COUNCIL — Romanian Minister Delegate for European Affairs, Ana Birchall, takes part today in Brussels in the meeting of the General Affairs Council. Under discussion is the draft conclusion of the council regarding the Cooperation and Verification Mechanism report, which acknowledges the major progress made by Romania, and emphasizes support for the Romanian authorities in meeting the demands of the mechanism. The meeting in Brussels is in preparation for the European Council agenda scheduled for March 8 and 9. The ministers will analyze a draft recommendation on Eurozone economic policies supporting economic growth, and will focus on reaching an accord on a European banking insurance system. Another point on the agenda is the update provided by the Maltese presidency of the Council on applying the inter-institutional accord for better legislation, passed in March last year. This accord is supposed to make the EU legislative process easier to monitor and more transparent.



    TENNIS — Several Romanian women tennis players are present at the Premier Mandatory tournament in Indian Wells in the US, with 6.9 million USD in prize money. Patricia Țig, 99th seeded, went to the final qualifiers by defeating Japanese player Shuko Aoyama, 212th seeded, 6-0, 6-2. Țig plays next American Julia Boserup, 97th seeded. Ana Bogdan, ranked 124th, was eliminated by Japanese player Nao Hibino, ranked 81st, 6-4, 2-6, 6-7. Sorana Carstea, 66th seeded, and Monica Niculescu, 45th seeded, plays against each other in the inaugural round, while Simona Halep, 4th in the world, and Irina Begu, ranked 32nd, play in the second round, with adversaries yet to be established.



    FOOTBALL — In Romania, the premiere football league regular season is over, with the play-offs and play-outs starting on March 10. The top six teams will contend for the title, while the last eight will have to fight to stay in the league. Viitorul, Steaua, standing champions Astra, Craiova, CFR Cluj and Dinamo are in the play-offs. Gaz Metan Medias, FC Botosani, FC Voluntari, CSM Poli Iasi, Concordia Chiajna, Pandurii Tg. Jiu, ACS Poli Timisoara and ASA Tg. Mures remain in the play-outs.

  • The law on the national defence industry has been promulgated

    The law on the national defence industry has been promulgated

    Romanian president Klaus Iohannis has
    signed a decree on the promulgation of a law on the national defence industry.
    The law, which was passed by the decision-making Senate last week, is
    regulating the organisation of this sector on strategic domains, in terms of
    streamlining and regrouping of capabilities, boosting investment and
    competitiveness and diversifying products specific to the field as well as
    involvement in the activities of the European defence industry.






    President Klaus Iohannis has said he is
    not concerned about the way in which US president elect Donald Trump refers to
    NATO, and is convinced that Romania’s relation with the United States will
    continue in good terms. Relations will be partly redefined, partly changed,
    but that doesn’t mean they will be worse, they can be better.






    In my opinion, the USA will continue to
    play the same role it has played so far, of being the largest NATO member with
    the most significant involvement in many regions, either with conflicts or not
    Iohannis added referring to Donald Trump’s statements in the election campaign.
    At that time Trump suggested that he would not defend the Baltic countries in
    case of a conflict, but would first assess their contribution to NATO.






    The Romanian president said that it was
    necessary that the member states allotted 2% of the GDP as Trump had also
    required, and that might wake some people up. Iohannis recalled that in
    January 2015, he proposed to parties to raise budget funds for defence to 2% of
    the GDP. Trump has said the same thing, namely that everyone should bring their
    defence spending up to the sum established together.






    At present only five EU countries have
    met this NATO objective and have earmarked 2% of the GDP for defence, whereas
    10 others have established clear roadmaps to meet this objective in the future.
    This means that only half of the members are presently allotting enough funds
    for their troops’ training and equipment. Romania has raised its defence
    spending by half billion dollars this year as compared to 2009, the country
    ranking third among the NATO countries in terms of providing equipment to their
    armed forces, says a report published by the Alliance. At the same time,
    Romania’s spending related to the GDP stay is estimated at 1.48%.




    Romania also comes tenth as troop force
    inside NATO, with 70,000 soldiers. Furthermore, in 2009 the country allotted
    2.2 billion dollars for the defence budget, while the sum envisaged for 2016 is
    500 million higher than seven years ago, placing it ahead countries like the
    Czech Republic, Estonia, Lithuania, Slovakia and Hungary.









  • The Week in Review 31.10 – 06.11

    The Week in Review 31.10 – 06.11

    The strike of the healthcare staff has been declared illegal




    The
    Bucharest Court on Thursday ruled that the strike of the healthcare staff held
    early this week was illegal. The decision can still be appealed, but it is
    binding. The magistrates thus agreed with the Health Ministry officials who
    claimed, among other things, that the trade unionists’ action did not comply
    with the legal conditions for starting a labor conflict. The healthcare staff
    went on strike on October 31, asking for higher salaries and better working
    conditions. On November 1st the protest was suspended, after the
    parliamentary committees approved a pay rise for the healthcare staff and the
    trade unionists received assurances that the amendments would be voted in the
    plenum of Parliament next week. The labour minister, Dragoş Paslaru, has warned that these pay rises could
    affect the country’s economy.





    The government criticizes the pay rises and the
    elimination of charges proposed by Parliament.




    The
    Romanian government believes that the pay rises and the elimination of more than
    100 charges, as proposed by Parliament proposals, will have a negative impact
    on next year’s state budget.


    Dacian
    Cioloş: As
    is customary for Romania’s Parliament before elections, a number of measures
    have been passed in recent months, which raise salaries for various categories
    of public sector employees, without thorough previous calculations. The total
    amount of money stands at around 9 billion lei, that is more than 1% of the
    GDP.


    The budget
    impact of the populist laws voted before the elections amounts to 2 billion
    euros, which will lead to either a deeper budget deficit or to a reduction of
    the funds to be allotted for investments. Moreover, the imbalances between
    several categories of state employees will increase. If the bills are passed in
    the form wanted by Parliament, the Government will challenge the salary law at
    the Constitutional Court. In the run up to the December 11 elections, on
    Tuesday the MPs in the joint budget – finance and labour committees amended the
    order on the salaries of state employees and introduced new categories of staff
    in the education and healthcare systems that will benefit from pay rises or
    bonuses, although salaries in these fields have already been increased in the
    past year by an average 30%. These pay rises were announced shortly after the
    MPs passed a draft law on the elimination of more than 100 non-fiscal taxes,
    including the radio and TV license fees.





    The government sets maximum levels for
    mandatory motor-vehicle liability insurance policies.




    Wednesday’s
    decision by the Romanian Government to impose certain caps, for a period of 6
    months, on the mandatory car liability insurance policies, has triggered
    conflicting reactions depending on the interests of the sides involved. The
    National Union of Insurance and Reinsurance Companies notified the European
    Commission on the 6-month freeze on car liability insurance prices, claiming
    that the measure infringes on the principles of free market and competition as
    stipulated in the Romanian Constitution. On the other hand, road carriers have
    hailed the measures passed by the government. Moreover,
    they call on Parliament to issue a new insurance law in these 6 months, before
    the expiry of the government’s ordinance on capping car liability insurance
    policies. Transporters also ask for the future law to ensure total transparency
    as regards the calculation of tariffs for all categories of vehicles held by
    natural persons and legal entities. The insurance companies that will sell
    insurance policies at prices exceeding the maximum value set by the government
    risk big fines. New regulations in the insurance field were adopted by the
    government after the protests organized by transporters. They have frequently
    contested the very high prices they had to pay especially for trucks and the
    fact that car liability insurances policies are growing by the year.





    Criminal prosecution to expand in case related
    to the 1989 anti-communist revolution.




    Almost 27 years after the fall
    of the Ceausescu regime, army prosecutors have expanded in rem the
    criminal proceedings in the so-called Revolution case to investigate crimes
    against humanity committed after the 22nd of December 1989.
    Prosecutor Marian Lazăr
    explains the reasons of this decision.


    Marian Lazar: It transpires from documents that are part of the case that,
    in order to hold on to power, through their actions and measures, the new
    political and military leadership instated after the 22nd of December
    1989 caused the death, gunshot injury, physical and psychological damage and
    unlawful deprivation of freedom of a large number of persons, actions that fall
    into the scope of crimes against humanity.


    The actions in question point
    to the existence of a plan aiming to create a state of confusion among the
    armed forces and thus enable the new leaders to take over power and acquire
    legitimacy. According to a document from the Military Prosecutor’s Office with
    the High Court of Cassation and Justice, more than 1,200 people were killed in
    the events of December 1989, of whom 800 died after 22nd of
    December, when the regime collapsed. More than 5,000 people were wounded and
    several thousand unlawfully deprived of freedom and subjected to bad treatment.
    The reopening of the Revolution case, which earned Romania a series of
    convictions at the European Court of Human Rights, comes a few months after
    interim prosecutor general Bogdan Licu called for the reopening of the
    inquiries. According to Licu, the ruling to close the case in October 2015 was
    ungrounded and illegal, and the legal classification of the deeds was wrong.





  • IMF mission to Bucharest

    IMF mission to Bucharest

    Is Romania the only or the most successful story of the IMF? The answer would be yes if we believe the Social Democratic PM Victor Ponta, according to whom the Romanian authorities have, to a large extent, acted upon the advice of the IMF, the World Bank and the European Commission, Romania’s international lenders. An IMF delegation led by the head of the IMF mission to Romania, Andrea Schaechter, held talks in Bucharest with top Romanian officials.



    The IMF experts have recently revised upwards the estimates regarding Romania’s economic growth. The GDP is expected to increase by 3.4% in 2015 and by 3.9% in 2016. Given that the latest stand-by agreement concluded with the IMF expired, the Romanian finance minister Eugen Teodorovici says Bucharest could apply for a new loan. But, after the meeting of the IMF delegation with the budget committee members, the Liberal Gheorghe Ialomitianu said, quoting the IMF experts, that a new agreement was not possible:



    “At present Romania cannot conclude an agreement with the IMF because opinions about the credibility of its government are extremely divergent. The Cabinet did not observe what Romania undertook under the agreement that expired. The government says it cannot respect those recommendations made by the IMF and the European Commission, while the IMF cannot endorse what the government is doing, because it does have its responsibilities”.



    Viorel Stefan, a Social Democrat, denies that the IMF made such a blunt statement, but acknowledged that there are certain obstacles.


    “There are talks about a flexible agreement, which does not involve a loan, but only technical assistance provided by the IMF. This would be a gain, because we all know that when the IMF gives you good credentials, you are regarded with more confidence on the capital markets. On the other hand, we must admit that structural reforms still need to be implemented. For 25 years we have been striving to reform state-owned companies”.



    The Romanian government is also blamed for the slow pace of reforms in the administration. The IMF expressed concern related to the fiscal and budget situation for 2016 and 2017, when Romania risks missing the deficit targets set. In a communiqué signed by the head of the IMF mission to Bucharest, the IMF estimates a budget deficit of 3% of the GDP in 2016 and an even higher rate in 2017, because of a combination of measures to massively reduce taxes and fees, on the one hand, and to increase salaries, on the other hand. The IMF recommends a 1.5% budget deficit target for 2016. According to the IMF, Romania’s macro-economic indicators have improved considerably, and protecting them is crucial in the context of global risks, especially in the emerging economies.