Interior Minister Says Romania Needs A New IMF Loan Agreement

Romania’s democrat liberal Interior Minister Vasile Blaga told an interview for Pro Tv that he thinks Romania needs to conclude a new agreement with the International Monetary Fund, which implies a new loan, but stressed, however, that the issue hasn’t been discussed by Government members.

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Blaga added that Cabinet members did not discuss the issue, but stressed he is certain that officials with the country's Finance Ministry and central bank have already held talks on the issue.

Blaga underscored that the country's budget deficit would rise to 9.1-9.2% of the gross domestic product at the end of the year if the Government did not take austerity measures.

Asked whether the Government should resign if obliged to increase taxes, Blaga said: "I am certain of that. The Government's measures represent the outcome of analyses conducted by experts in all fields".

Romanian democrat liberal Prime Minister Emil Boc earlier this week sought the lawmakers' confidence vote for the country's austerity plan, which cuts social welfare benefits, pensions and public sector wages. Boc warned that Romania risks payment default unless it cuts budget spending. The austerity plan should help the recession-hit country bring its economy on track and convince the International Monetary Fund, which is leading a EUR20 billion rescue package agreed last year, to disburse further installments of the loan.

Boc is now facing a no-confidence motion, submitted against the two austerity laws by the social democrats. The standing offices of Romania's two chambers of Parliament decided earlier this week that the no-confidence motion will be put to the vote Tuesday, June 15, at 10:00 a.m..

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