Fin Min: Romania Needs To Cut Curr Acct Def For Higher RatingsPublish date: 02-12-2008
Romania needs prudent revenue, monetary and fiscal policies to permit a gradual and predictable cut of the current account deficit to a level that can be sustained by direct capital investments, in order to regain rating agencies' confidence, according to a Finance Ministry document.
The document reveals that, given the deepening of the international financial crisis, a prudent fiscal policy is compulsory to also reduce the budget deficit and improve the budget revenues collection.
"Romania has to unroll policies that will permit the gradual and predictable reduction of the current account deficit (…). The efforts will be aimed for a gradual correction of the current account deficit, through a balanced monetary, revenue and fiscal policy mix, and the acceleration of structural reforms that will lead to an increased labor productivity," the ministry document, obtained by Mediafax, said.
An improvement of the business environment is compulsory to attract more foreign investments. It will also lead to an inflation decrease, while maintaining a high economic growth.
"In Central and Eastern Europe, the economic growth is still solid, but there are signs that it can be affected by the financial crisis, as it depends on attracting foreign capital," the document said.
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