The
\nprecautionary agreement with the IMF, which Romania signed in 2013, expired a
\nfew days ago. Although the Romanian economy has registered a significant growth
\nlately, the Romanian Government plans to conclude another precautionary
\nagreement to protect Romania’s finances against market shocks. XX is in the
\nstudio with more, in a commentary by Andrea Bojoi.<\/p>\n
<\/p>\n
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The 2 billion Euro precautionary
\nagreement signed by Romania and the IMF in 2013 expired on Saturday. In reality,
\nthe accord has actually been blocked in the past six years, because of the
\ndisagreements between Bucharest and IMF officials regarding the Romanian
\nGovernment’s fiscal plans. In early 2015, authorities tried to adopt a big
\ntax-reduction package through the new Fiscal Code, but representatives of the
\ninternational financial institutions, just like the Fiscal Council and the
\nNational Bank, criticized the initiative. <\/p>\n
<\/p>\n
One day after the agreement expired,
\nPrime Minister Victor Ponta wrote on a socializing network that in 2015
\nRomania’s economic situation has changed dramatically as compared to 2009, when
\nthe first accords with international lenders were signed, and Romanians’ living
\nstandards and incomes have increased significantly. To make his point, the Premier
\npresented some comparative figures. In 2009 the economic growth stood at minus
\n6,6%, as compared to 3.7% growth rate registered in the second quarter of 2015.
\nThe budget deficit in 2009 was 9% of the GDP, while in 2015 the estimated
\ndeficit stands at 1.45% of the GDP. Ponta also wrote that Romania is as safe
\nand stable economically as any developed member of the EU, quoting an
\ninformation published by the Standard and Poors rating agency. <\/p>\n
<\/p>\n
According to the
\nsame agency, Romania’s risk of defaulting on payments is only 7.8%, as compared
\nto the period between 2009 and 2011, when Romania was among the 10 countries
\nwith the highest risk of defaulting. The IMF has recently confirmed that, if
\nthe trend is maintained, Romania is likely to outrank, from an economic point
\nof view, countries such as Portugal, Greece and the Czech Republic. Although
\nthe current agreement with the IMF has expired and the country’s economic
\nsituation is good, the Finance Minister Eugen Teodorovici has announced that
\nRomania plans to start negotiations with the international lenders for a new
\nprecautionary agreement, which would come into force in 2016. In his opinion,
\nsuch an agreement is necessary to protect Romania’s finances against potential
\nmarket shocks and to facilitate cheaper loans from the world markets. <\/p>\n
<\/p>\n
According
\nto experts, the explanation for such a decision lies with the current context,
\nin which the provisions of the new Fiscal Code and the upcoming salary increase
\nin the budget system are estimated to bring the deficit close to 3% in 2016. In
\ntheir opinion, negotiating a new loan will be more difficult now, given that
\nthe Romanian officials have almost all the time disagreed with the IMF with
\nregard to the latest accord. Still, they are expecting a clear direction in the
\nrelations between the two parties to be established in the coming period. <\/p>\n
\n
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