Analysts - not optimistic on economic indicators' evolutions in 2009

The budgetary deficit most realistically to be negotiated with IMF is 7-7.5 per cent and the measure to downsize civil servants by 20 per cent is an appropriate and necessary one, as Bogdan Baltazar, financial adviser, said yesterday, cited by Agerpres.

"From among the budgetary deficit figures circulated lately in Bucharest, as for the budgetary deficit considered until end of 2009, 9 per cent is out of question. It is too much. Negotiating with International Monetary Fund (IMF) a new level for the budgetary deficit has to result in a figure that it is stimulating, on one hand, and it is also a constraint for the government. This is why I think that it should be rather self-imposed by the Romanian side, at 7 per cent or maximum 7.5 per cent.

Regarding the decrease of expenditures by downsizing civil servants number by 20 per cent, I believe this is necessary. The unemployment allowance that the Romanian State should pay in case they dismiss 20 per cent of the civil servants would be an amount lower than salaries and bonuses they have to pay now," Baltazar explained.

In his turn, Mihai Tanasescu, senior adviser with the IMF, said that the evolution of the Romanian economy, within the context of the global and regional economy, will lead to a reshaping, over the next quarters, of the targets agreed with IMF in March.

"Regarding the budgetary deficit, one has to consider that this is an outcome. It results depending on the economic situation. Hence, in this, one has to start from the size expected in the contraction of the Romanian economy this year, from the figure by which Romania's GDP is expected to decrease. There are several scenarios, but the most likely economic contraction is around 8 per cent. This will result in raising the budgetary deficit. But this raise of the budgetary deficit can be offset by the measures which the government considers in the remaining time period of 2009 and by the covering, in the next period of time, of the balance of the budgetary deficit up to 3 per cent asked by the European Commission," Tanasescu said.

On the other side, the leader of Businessmen Association (AOAR), Florin Pogonaru, estimates that the economic decline by 7-8 per cent expected this year and forecast by the government is "a big catastrophe" and it will result in many companies going bankrupt and in the reorganization of economic sub-sectors.

"For the business environment, a decline from plus 7-8 per cent to minus 7-8 per cent means a big catastrophe, it mainly means bankruptcies and reorganization of certain economic sub-sectors. The government should not waste the ammunition represented by the funds received from the EU and from other international institutions to rescue large and small companies facing difficulties," according to Pogonaru.

He indicated that businessmen asked, during the meeting they had on Friday with the Government, for reducing bureaucracy in administration and for the participation of investors in drafting the new fiscal code.

Nine o'clock