The main question is whether consumption or investments will be first to adjust in Romania, considering that the foreign context leaves little space for hesitation, the Governor said last week. He explained that the adjustment of Romania’s economic growth pace will happen “even if we do not want it,” and will follow several years marked by a significant rise in consumption.
Isarescu indicated that time is of the essence, as the effects of the international financial crisis are combined with those of Romania’s foreign deficit. He also explained that rises in salaries cannot be financed due to Romania’s large current account deficit and the economic crisis. In addition, such salary rises, which waste away because of inflation, would affect the growth potential of investments in Romania.
