| THE NATIONAL BANK OF ROMANIA AND THE WORLD CRISIS 10/09/2009 |
| (2009-09-10) |
| Last updated: 2009-09-11 16:17 EET |
According to the estimates made by the National Bank governor, the sum allocated to Romania by the Union in 2009 alone stands at 9 billion euros. Isarescu also said, however, that the absorption of community funds was below minimum expectations for this year and many funding applications face bureaucratic problems. Governor Isarescu pointed out that undeveloped states need foreign financing, which leads to a deeper current account deficit:
“If a country invests more than it can save, this can only be achieved with foreign savings, in other words, through a current account deficit. If a state has a lower development level, it needs its savings.”
According to Isarescu, salaries went up in Romania faster than work productivity, which deepened the current account deficit. On the other hand, Isarescu believes commercial banks are excessively cautious towards their clients, which slows down the attraction of European funds. In the opinion of the National Bank governor, public investment, which may become an engine for development, is a solution which Romania can use only to a certain extent.
Isarescu also believes that Romania’s entry into the eurozone in 2014 is achievable, but it would imply a shift in focus from inflation and interest rate to the issue of public deficit. He says Romania’s situation is very similar with that of Hungary, a country which has seen excessive public deficit. Isarescu concluded that the Romanian anti-crisis programmes are sufficient, but difficult to implement.
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2025-04-03
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