IMF agrees funding for public sector pay rises in Romania, other economic measures

The International Monetary Fund, currently on a review mission to Romania, has agreed funding to increase public sector pay increases with the Romanian authorities, as well a number of measures to stimulate job creation. Romania's government also committed to privatizing state assets, which the IMF nags about every time a mission is sent.

"I would say that we have successfully concluded negotiations with our international partners - the European Commission, IMF and World Bank," said Romania's Finance Minister Florin Georgescu on Saturday evening (August 11 ). He said that negotiations were necessary to restore the wages cut in June 2010 and the payment of "improperly withheld of pensions". Also the proposed VAT changes were accepted by the international institutions, meaning Romania will be able to applly the reversed VAT measure from 2013. "We also agreed to implement from October a package of measures to stimulate job creation," said Georgescu. The minister said that Romania has committed to privatize Oltchim with a strategic investor by mid-September, "which will highlight the potential of this economic unit and of the closely associated Arpechim." Economy Minister Daniel Chiţoiu said that Electrica Furnizare will have private general manager by the end of September. Also, Romgaz, Transgaz and Transelectrica will have private managers later this year, and Hidroelectrica will have private leadship and will be listed when it gets out of insolvency. The Ministry of Transport will establish privatization terms for Tarom and CFR Marfa during 2012, but an firm date for their sale has not been given. Following discussions with the IMF, the Ministry of Health has postponed the date from which patients will be charged for each visit to the doctor or hospital. The law will first be discussed with patients' associations, said Health Minister Vasile Cepoi. The Ministry of Health launched earlier this month a draft law for co-payment in health care. According to the proposition hospitalization for one day would cost between RON 20 and 60, while a visit to the doctor should have a minimum fee of RON 5. Ioana Toader, ioana.toader@romania-insider.com (photo source: presidency.ro)