Romania Needs Privatization, Private Management To Foil “Wise Guys” - IMF

The government needs to hurry privatizations and the appointment of private management at state-owned companies, to decisively change the system where a privileged few enjoy undeserved profit, says Jeffrey Franks, head of the International Monetary Fund’s delegation to Romania.

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"We need to permanently remove a system where the public and private sector wise guys enjoy undeserved profit, while their employees and the public pay for these inefficient activities," Franks said Monday.

The IMF official added local authorities have shown the determination to hurry privatizations and the appointment of private management at state-owned companies, but more action is required, as well as the completion of legal amendments by the end of the year.

The European Commission is looking at contracts concluded by hydropower producer Hidroelectrica with Arcelor Mittal Galati and Alro Slatina, as well as with other electricity distributors. The investigation stems from the assumption that the deals are a form of state aid, since they might include prices below market levels.

Local media refers to the preferential contract beneficiaries using the term "wise guys," coined by President Traian Basescu.

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