The ECOFIN Council, which brings together finance ministers of EU states, on Tuesday approved the revised decision to grant the loan to Romania to support balance of payments on a medium-term, says a release of the Ministry of Public Finance (MFP). Moreover, the ministers endorsed also the Council’s recommendation to correct the excessive deficit of Romania.
The Stability and Growth Pact provides that, if the recommendations for an EU member state have been observed, but the economic situation has deteriorated significantly, the Council may review the recommendations and the deadline for correction. ‘Romania has taken the steps to reduce costs of goods and services, and also to cut spending with the personnel in the public sector.
The country also made good progress in fiscal consolidation by adopting the law on public sector wage and submitting to Parliament the legislation on pension system reform and fiscal responsibility. Observing the 2009 budget target for further proved the commitment of Romanian authorities. Taking into account the measures actually taken, the European Commission recommended deadline for correcting the excessive deficit to be extended by one year to 2012, says the release.
Romania has obtained a loan of five billion euros from the European Commission, through a program of medium-term financial assistance. So far, Romania received 1.5 billion euros from the EC.