Romania’s 09 GDP Contraction Seen Above 8% In New Scenario - Sources

Romania’s 2009 economic contraction is forecast at 8%-8.5% in a new scenario to modify the macroeconomic frame on which the country’s agreement with the International Monetary Fund was based, according to people involved in negotiations with the IMF.

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“Both the IMF and the Government are now talking on a base scenario that see an economic contraction of 8%-8.5% in 2009, compared with the 4.1% GDP fall estimated when the agreement was signed,” the sources told MEDIAFAX.

An IMF mission arrived last week in Bucharest for the first evaluation of the EUR12.95 billion stand-by arrangement.

Romania’s GDP fell 6.2% on the year in the first quarter, but several officials and analysts said a sharper contraction might be seen in the following quarters.

First estimates on second quarter GDP are to be released August 13 by the country’s Statistics Institute.

The IMF loan is part of a EUR19.95 billion financial package secured by Romania that also includes funds from the European Commission, and other international institutions.

Romanian Prime Minister Emil Boc and the ministers will meet the IMF mission at the Government headquarters, around 17:30 local time, after the weekly Cabinet meeting, government sources told MEDIAFAX.

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