Monday, March 23, 2015

Romanian PM nominates himself as interim finance minister

By Radu-Sorin Marinas

BUCHAREST (Reuters) - Romania's prime minister nominated himself to take over the finance ministry portfolio temporarily he said on Friday, after the previous minister became the most senior sitting politician to be investigated in a corruption crackdown.

Victor Ponta would be taking over days before his government is set to approve sweeping tax cuts for 2016-2019 designed to stimulate economic growth, but which analysts have criticized as unsustainable. Ponta has insisted his government's fiscal policy would not be derailed by ongoing corruption probes.

Ponta also faces potentially difficult talks in April with the International Monetary Fund (IMF) to negotiate the terms of an ongoing standby aid deal that expires in September. Talks ended without agreement in February as Bucharest resisted calls to raise gas prices and restructure state-run coal companies.

"I will take responsibility as interim for the finance minister until March 25," Ponta said on his Twitter page. "After fiscal codes are adopted, I will submit a proposal for a new minister to the president."

Former Finance Minister Darius Valcov resigned after anti-corruption prosecutors accused him of taking kickbacks worth about 2 million euros in a previous role as a provincial mayor. Valcov, who has denied wrongdoing, cannot be arrested until parliament votes to allow prosecutors to do so.

Valcov has joined a growing list of senior figures -- from a top judge to the prime minister's father-in-law -- to be investigated for graft in an energetic crackdown by prosecutors that has won praise from Brussels.

Ponta would become the government's fifth finance minister since his government took office in May 2012, and the premier has jokingly referred to the position as a "kamikaze" role.

Three senior officials from his ruling Social Democrat Party told Reuters earlier in the day that Ponta will nominate himself.

"We couldn't yet find a successor to Valcov, not that there aren't willing takers. It's that we have yet to find a suitable person to handle this," another senior ruling party member told Reuters.

Ponta is due to meet President Klaus Iohannis, who must formally approve the appointment.

Romania, one of Europe's poorest states, has emerged from deep recession after a real estate crash to grow 2.9 percent last year while keeping its fiscal deficit under the limits agreed with the IMF and the European Commission.

Once the IMF deal expires, Ponta has said Romania could seek a new type of arrangement such as a flexible credit line, which would come with fewer conditions than the quarterly reviews the country has had to pass to keep its aid deals going since 2009.

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