IMF recommends that Romania draw up long-term fiscal policies

“The authorities should focus on the 2009 budget instead of that for 2008,” IMF’s Representative for Romania and Bulgaria, Albert Jaeger, said. He added that government projections for this year’s budget are exaggeratedly optimistic.

The government’s projections for 2008 include revenues amounting to 39.3 percent of gross domestic product (GDP), compared to less than 32 percent of GDP in 2007. According to Jaeger, the government’s projections could be 1-1.5 percent of GDP above the level estimated by IMF, of RON 6-8 billion (€1.6-2.2 bln).

Furthermore, Jaeger criticized Romania for making little progress in structural reforms, especially as far as labor market and business environment regulations are concerned, fields which are crucial for sustainable economic growth, according to the IMF official.