Romanian PM’s adviser sees 5% growth on fiscal measures, analyst disagrees

Cristian Socol, Romanian Prime Minister Victor Ponta’s adviser on macroeconomic issues, thinks that the Government’s fiscal relaxation measures will help stimulate investments and create new jobs. This will lead to an economic growth of 5% in 2016, Socol estimatest. The central bank’s specialists disagree. Fiscal and monetary relaxation measures don’t bring economic growth on the long term, says Valentin Lazea, Romania’s National Bank chief economist. A higher economic growth can’t be achieved through fiscal and monetary relaxation measures, Lazea added. Measures like the VAT cut on food, the cut on tax for dividends, as well as the wage increases in public sector have raised the fear that the fiscal deficit could exceed 3% of the GDP. The country's indebtedness over the current threshold of 40% would bring an increase in interest expenses, according to Lazea. editor@romania-insider.com