Romanian President: Romania’s 2012 deficit must drop to 2.3 - 2.4%

Romanian President Traian Basescu recently said, during a TV show at TVR, that the deficit agreed with the Government and the Central Bank is 2.3 -2.4 percent of the GDP in 2012. Thus, Romania will borrow less money next year, and the country’s budget for 2012 will be created based on a growth forecast of 1.5 to 2 percent. The President said that Romania may reach a “disaster” as in the case of Greece, if the country fails to escape the vicious circle of debt and create a budgetary surplus. The Romanian President said earlier this week thatRomania’s 2012 budget must be extremely cautious, especially since financing the deficit would be extremely expensive, due to the EU and the regional situation, primarily influenced by Greece. Traian Basescu added that the country’s deficit target has to be revised due to the financing costs. “The 2012 deficit should be lower than 3 percent. The Government must find solutions to reduce the need for loans,” he said. Moreover, the president promised that pensions and salaries will not be cut in Romania next year. Irina Popescu, irina.popescu@romania-insider.com