Romanian central bank: Tax incentives are not enough for economy to grow

Tax incentives can’t help Romania’s economy maintain a sustainable 5% growth for 10 years, because they represent only short-term measures, said Valentin Lazea, chief economist of Romania’s National Bank (BNR). The only viable solution is continuing structural reforms. These include the privatization or the restructuring of inefficient state companies, increasing the efficiency of state administration and boosting competition and investment on all markets, Lazea added, reports local News.ro. Romania recorded a 4.9% economic growth in the first three quarters of 2016 but this has been achieved by stimulating the demand and consumption, according to BNR governor Mugur Isarescu. This has led to the creation of jobs in other countries, because the higher domestic demand was mostly satisfied through imports, which have been growing at a faster pace than the exports. “We are not against incentives, but it is imperative that they are carefully chosen,” Isarescu said. Romania’s economy grows by 4.8% in the third quarter editor@romania-insider.com