BNR: Crisis will last many years in Romania if we talk about 30-pc pay rises

Romania will be in a crisis for many years if we talk about 30-percent pay rises, Governor of the National Bank of Romania (BNR) Mugur Isarescu said on Thursday.

‘If we talk about improved living conditions or pay increases of 30 percent a year, I believe we will be in a crisis for many years. No serious country can talk about pay rises of 30 percent, with all the large gap between Romania and other European countries,’ said Isarescu, adding that BNR is advising ‘prudence, some patience and reasonable steps.’

Isarescu also warned that the real connection is not between income and wishes, but between income and productivity.

‘If living standards could improve in this real world as we wish, then all the countries would be rich. But things are not so.
Living conditions do not improve under decrees or laws, even when they are issued by the most advanced parliament, and they certainly do not improve through wishes, but through productivity.

This is hard to realise and accept, because when it comes to understanding it, we do understand,’ said Isarescu.

He admitted that the correlation is complicated, because there is no easy calculation for productivity, and incomes are different, much as there are several social categories.

‘There are social grievances all over the world,’ Isarescu concluded.

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