Monday, August 1, 2011

IMF: Romania's Economy Growing Again

BUCHAREST, Romania (AP) — An International Monetary Fund official says Romania can afford to increase public sector wages as the economy rebounds.

Jeffrey Franks, the IMF envoy to Romania, said Monday the government could raise salaries "in the coming months," albeit modestly, and added that he expected the economy to grow by 1.5 percent this year and about 4 percent in 2012.

The government initially slashed wages by a quarter in 2010 and implemented other harsh austerity measures to meet the terms of an IMF-led loan it needed to pay wages and pensions.

In 2009, Romania took a two-year euro20 billion ($28 billion) loan from the IMF, the EU and the World Bank, as its economy shrank by 7.1 percent.

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