Wednesday, March 24, 2010

Romanian Government Keeps Euro-Adoption Goal of Jan. 1, 2015

By Irina Savu

March 23 (Bloomberg) -- Romania maintained its target to adopt the euro in January 2015, the government said in a statement on its Web site late yesterday.

The government also kept its economic growth forecast for this year at 1.3 percent and predicted expansion of as much as 3.7 percent in 2012.

“The commitment to adopt the euro as of Jan. 1, 2015 is maintained and represents an important anchor for the budget and structural reforms needed to increase the flexibility of the Romanian economy,” the Bucharest-based government said in the statement. “The strategy aims to strengthen short- and medium- term financial market confidence and the stability of public finances by promoting a mix of coherent measures which will lead to a narrowing of budget deficits.”

The eastern European country, which turned last year to a group led by the International Monetary Fund and the European Commission for a 20 billion euro ($27 billion) bailout package to stay afloat, plans to narrow the deficit to 5.9 percent of gross domestic product this year from 7.3 percent in 2009 and below 3 percent by the end of 2012 to meet euro criteria.

The economy suffered the worst recession in at least 20 years in 2009 as booms in construction and commerce collapsed. The recession wiped out gains made in 2008 when the economy grew 7.1 percent, the fastest pace in the European Union, which the country joined in 2007.

The leu was little changed at 4.0852 per euro after the announcement. The Bucharest Stock Exchange benchmark BET index fell 0.5 percent to 5867.68.

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