BUCHAREST -(Dow Jones)- Romania and the International Monetary Fund have reached an agreement on the country's budget for 2010, IMF representative Jeffrey Franks said Tuesday, news agency Mediafax reported.
Speaking after a meeting with Romanian interim Finance Minister Gheorghe Pogea, Franks said the next challenge for the authorities in Bucharest is to send the budget to parliament for approval as soon as possible. Franks said Romania might be able to run a budget deficit of 7.3% of gross domestic product in 2009, in line with the target agreed upon with the IMF.
In November, the IMF said Romania could exceed its budget cap. However, things look better now, Franks said.
Romania, hit hard by the global crisis, relies heavily on a EUR20 million IMF- led loan package obtained in the spring. The country has received so far around EUR7 billion from IMF in two installments, and was scheduled to get another EUR1.5 billion in December. But the IMF said it would delay additional tranches until Romania has a functioning government and a proper budget for 2010, which includes a deficit budget of 5.9% of GDP. Pogea said Monday that Romania might get the third loan tranche from the IMF in January, two months ahead of a new quarterly assessment mission from the Fund.