Romania keeps its target : euro starting January 2015Updated: 10-03-2010 | Financial and Banking

The convergence programme of Romania for 2009 - 2012 updated in February this year focuses on the reduction of the budgetary deficit under 3% of GDP and keeps the commitment to adopt the euro starting January 2015. The reduction of the budgetary deficit under the level of 3% of GDP in a sustainable way and Romania accession to the euro zone are the main commitments assumed by the government in the latest edition of the convergence programme.

The fourth edition of the convergence programme shows Romania's intention to bring the structural deficit at lower than 1% of GDP by 2014, such having a sufficient margin for avoiding the overcoming of 3% limit of GDP for the budgetary deficit. The commitment to adopt the euro on January 2015 is kept and is the important anchor in promoting the budgetary and structural reforms necessary to the increase of the Romanian economy flexibility the introduction to the programme says. In view to adopting the euro Romania has to meet the convergence criteria included in the Maastricht treaty, among which is the budgetary deficit under 3% of GDP.

The budgetary deficit of Romania was 7.4% of GDP in 2009, at the value of the gross domestic product published by INS of 491.27 billion lei.

The new provisions in the financing agreement signed with IMF impose Romania a budgetary deficit of maximum 5.9% of GDP oblige the Romanian authorities to reduce state expenditure with the budgetary salaries by 0.2%through redundancies and another 0.2% through reductions.

The essential budgetary objectives in the convergence programme aim at limiting the cyclicity of the economy, the reduction of inflationist pressure and the limit to foreign deficit.

One of the assumed challenges of fiscal policy during the estimated period is the reconciliation of the objective regarding the meeting of the nominal criterion of budgetary convergence in a sustainable way, with necessary measures to limit the effects of the economic and financial crisis on the Romanian economy. In this way, the budgetary objectives are aimed at limiting the cyclicity of the economy, the reduction of inflationist pressure and the reduction of foreign deficit the programme shows.
To update the convergence programme, the ministry of public finances took into consideration the latest evolution and projections of the economic domestic and foreign environment, as well as the legislative frame under effect, including the budget for 2010.