2023-10-04 15:49:00
Prime Minister Marcel Ciolacu declared on Wednesday following the meeting with the IMF experts that there will be no need for new taxes and new measures, if the plan of fiscal measures assumed in the Parliament goes ahead. He claims that the greatest danger, namely that of paying a fine of 0.5% of GDP if Romania does not respect the 4.4% deficit target, was completely overcome following the technical discussions held with the European Executive and the President of the Commission European.
Marcel Ciolacu and IMF expertsPhoto: Government of Romania
- “If we stick to the started plan, I don’t think any other measures will be needed. The excitement of the war has passed, there are already a lot of direct investments and I am firmly convinced that Romania will once once more have the second economic growth in Europe, something that will be cemented even better macroeconomically.
- I want to speed up the digitization of ANAF, we will also have discussions next week, I will also present it to the Romanian president, as it is a strategic objective for Romania and there will be no need for new taxes.
- September is not a fantastic month for collecting. We have announced the apocalypse enough, to announce it further, because it has not come. At this moment if we stick to what we promised and we will continue with the reorganization in the ministries, as we promised, things become sustainable”, Prime Minister Marcel Ciolacu said on Wednesday, when asked regarding the talks with the IMF.
Asked if there is a danger of losing European funds for not reaching the assumed deficit target for this year, of 4.4% of GDP, Ciolacu claimed that the greatest danger has been completely overcome.
- “The biggest danger was first of all paying a fine of 0.5% of GDP because there was a possibility that we would not respect the agreement assumed by the state of 4.4% of GDP in terms of the deficit.
- This is completely overcome following the discussions with the European Commission and with the technician and with the president (not the president of the European Commission). So from my point of view we are moving towards a normality. I know very well, and following the meeting with the IMF and with the technician from the Commission and with the president of the Commission and with the Minister of Finance and with the experts from the BNR, what I have to do following the law is promulgated”, he said.
Head of the IMF mission in Romania: Many other programs are needed to increase efficiency, revenues in general / The deficit of 3% of GDP will not be reached in 2024
The Government’s package of fiscal measures is intended to reduce the budget deficit, however, many other programs are needed to increase efficiency and revenues, in general, the head of the IMF mission for Romania, Jan Kees Martijn, said on Wednesday.
- “Turnover taxes on banks and large businesses place an unfair burden on low-margin companies and can reduce financial intermediation.
- The fiscal package is good but needs to be improved.
- The new fiscal package will improve the situation for 2024 in terms of controlling the budget deficit to be maintained at 3% of GDP. The target will not be reached in 2024.”, he declared.
The IMF expects the budget deficit to fall from 6% this year to 5% in 2024. The IMF forecasts economic growth of 2.4% this year and 3.7% in 2024, according to its latest report the institution. It should be noted that the revision was made downward: in October it anticipated 3.1% for 2023.
As for inflation, he also sees it at double digits, namely 10.5% (this is the annual average) and 5.8% in 2024.
For the end of this year, an inflation of 7.5% is expected.
The projected current account deficit is 7.9% for 2023 and 7.7% for 2024.
The National Strategy and Forecast Commission expects economic growth of 2.8% this year.
The World Bank, in its January report, expected 4.6% in 2022 and 2.6% in 2023.
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