Tuesday, December 21, 2010

Romania's government survives no-confidence vote

(AP:BUCHAREST, Romania) Romania's government on Monday survived a no-confidence vote in Parliament, which the prime minister called a victory for "sense and safety" over populism.

The opposition called for the vote following a dispute with the government over the terms of the country's bailout agreement with the International Monetary Fund.

Romania took a 20 billion euro ($26.52 billion) loan from the IMF, the European Union and the World Bank last year, when its economy shrank by 7.1 percent.

The IMF said Romania must pass legislation on public wages, pensions and the 2011 state budget before it could receive the next loan installment.

The opposition filed two no-confidence motions against the government's proposed wage laws. Another no-confidence motion will be debated on Thursday. The laws will be adopted if the no-confidence motions fail.

One law increases public salaries by 15 percent, six months after the government slashed them by one-fourth to keep the budget deficit down during recession. Another wage law _ expected to be adopted if the no-confidence motion fails Thursday _ sets a new pay scale for public workers.

Prime Minister Emil Boc called the result a victory for "sense and safety for 2011 against populism." Earlier he urged lawmakers to vote against the no-confidence motion, to not jeopardize the loan agreement with the International Monetary Fund.

Recently President Traian Basescu said Romania needed to borrow 6 billion euros ($7.96 billion) in 2011 to cover a budget deficit of 4.4 percent. While predicting the economy would grow by 1.5 percent next year, he said Romania still needed to rein in spending.

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