Wednesday, July 22, 2009

Romania econmin sees '09 budget deficit at 7 pct/GDP

BUCHAREST, July 21 (Reuters) - Romania's consolidated budget deficit may reach 7 percent of gross domestic product at the end of this year, Economy Minister Adriean Videanu said, far above an IMF-agreed 4.6 percent target.

Asked where he predicted the shortfall would be, Videanu told a Monday night television talkshow: "Seven percent in 2009."

The official said his centre-left government would try to renegotiate the year-end target with a visiting mission from the International Monetary Fund which is expected to review Romania's stand-by deal in early August.

But he would not say what the envisaged deficit figure was.

Government officials have said Romania needs a more generous budget to finance badly-needed infrastructure investment this year while its economy undergoes deeper than forecast recession.

Since it secured a 20 billion euro foreign aid package led by the IMF to shield its economy from global crisis, Romania has stayed on course with budget plans as agreed with a group of lenders that also includes the European Union.

But first-quarter data showed a deeper than expected recession at 6.2 percent on the year and a senior central banker had said the second-quarter contraction could be "significant".

No comments: