Government projects, "negotiated with the IMF"

Talks begin Wednesday at Bucharest between the Government representatives with those of the International Monetary Fund, arrived in a new assessment mission of the precautionary stand-by agreement.

Experts from the international financial institutions will examine with Romanian officials the way they have complied with the previously targets have agreed.

Prime Minister Victor Ponta said on Tuesday that he is optimistic about the results of the discussions about government projects, among them the reducing VAT on basic products from 24 percent to 9.

"It is very important to show our seriousness and determination in keeping our word, because I am convinced that this will be reflected both in the atmosphere on the financial market and banking with regard to the business environment, as well.

"The things that we want and we have announced that we can support them in discussions with our international partners, the project on VAT, the project concerning employment of the unemployed and exemption from social insurance contributions, declaring VAT as eligible on European projects, to be presented very clear with implications for emphatic support of our international partners," said Victor Ponta.

Former IMF representative of Romania, Mihai Tănăsescu, says, however, that a VAT of 9 per cent on basic foodstuffs could lead to a reduction of tax evasion, but not at lower prices.

He said that the biggest risk is a dramatic fall in revenues to the budget.

On Wednesday , Mihai Tănăsescu will take over the post of Vice-President of the European Investment Bank, Romania was represented for the first time at this level.

As IMF representative will be dealt with by the director of operations of the National Bank, Şerban Matei.


Translated by
Denisse-Meda Bucura
MTTLC, Bucharest University