Wall Street Journal joins international chorus of disapproval of Romanian government's actions

Another day and another international news story on Romania's political situation. This time it's the Wall Street Journal's (WSJ) turn to take take a pop at Ponta. The WSJ article's spin is the potential economic fall out from the ongoing political row. Highlighting the Romanian leu's recent exchange rate losses, the WSJ suggests that this may prove to be “the tip of the iceberg” when it comes to economic damage. Worryingly, the WSJ considers that there is a “big danger” of Romania losing the EU/IMF standby agreement precautionary funds, which value around EUR 5 billion. Romania is yet to tap into these funds, having continued to treat them as 'emergency only' funds. But, points out the WSJ, with the threats to funding lines to subsidiary banks coupled with the Romanian banking system's 80 percent foreign ownership, such an emergency situation could soon arise. The temptation to back out of austerity agreements for popular support is also underlined and the current Romanian government's position is variously described as risky and reckless. Foreign investors could also be scared off by the apparent threats to the rule of law, according to the WSJ. Foreign investment in 2012 in Romania is already well down on last year, without adding the repercussions of political bickering. The full story here. Liam Lever, liam@romania-insider.com