President Traian Basescu: Romania is currently deeply affected by situation in euro areaPublish date: 07-12-2011
Romania is deeply affected by the situation in the euro area at the moment said President Traian Basescu on Wednesday night in a statement issued at Cotroceni Palace.
"Romania is currently severely affected by the situation in the euro area ... Our credit default swap (CDS) was somewhere in June around 200 points on ten-year loans, and below 100 points at one-year loans. This is the first insurance for loans and our CDS at ten-year loans exceeded 450 points and is going up, due to the mistrust generated by the delays for Greece, by the situation in Italy. Therefore we are affected. Romania pays a heavy bill for the procrastinated firm decisions in the euro area," said Traian Basescu.
He said Romania "forced" for a 1.9 percent deficit as a solution for the effects of the situation in the euro area.
"I can tell you what we did. Seeing what goes on around us, we forced a 1,9 percent deficit instead of a 3 percent one, with the precise idea to borrow less, because any 7 percent interest rate is already too high. We borrowed at 5.2 or 5.3 percent in June and the interest rates reached now 7 or 8 or even above 8 now. We have the same CDS as Italy now," said Basescu.
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