Romanian Public Spending "Infested" By Inefficiency – IMF Official

Romania must continue fiscal consolidation to reduce the budget deficit to under 3% by 2012, especially given its poor absorption of European funds and public spending "infested" by inefficiency, said IMF mission chief Jeffrey Franks.

10 views

Franks said Romania currently uses less than 3% of the EUR19 billion in structural funds at its disposal. These funds are to be directed to the development of infrastructure, the education system and other areas that support economic growth.

Referring to the loan agreement between Romania and the International Monetary Fund, due to end on March 30, Franks said it achieved three major objectives: correcting macroeconomic imbalances, starting the reform process and avoiding a banking crisis.

However, considerable efforts are still required to continue the structural reforms and allow Romania to benefit from its economic growth potential, said Franks.

The IMF's Executive Board on Friday approved the final review of a EUR13 billion stand-by arrangement with Romania, and the terms of a new, precautionary deal that will start on March 31.

If you liked this story, please follow MEDIAFAX.RO on FACEBOOK »

The content of mediafax.ro is for your information only. Republishing or using this content is forbidden without express consent of MEDIAFAX. For this consent, please ask for it by mail at vanzari@mediafax.ro.