IMF Board OKs Romania’s Request For New Waiver On Govt Arrears

The International Monetary Fund Board approved Romania’s request for a new waiver of non-observance in the government arrears sector for end-December, the IMF said in a press release.

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Data regarding budget deficit, state guarantees and inflation target performance criteria for end-December were not available and could not be analyzed by the IMF delegation. The IMF Board also agreed to grant Romania a waiver from data availability requirements.

Romania's Finance Minister Gheorghe Ialomitianu told MEDIAFAX recently that the Government met arrears prerequisite. "According to the additional letter of intent signed with the IMF, arrears should not be higher than EUR250 million at the end of November. The Government achieved this target as arrears were of EUR248 million end-November," Ialomitianu said.

The IMF Board approved Friday the release of the seventh disbursement of a stand-by loan to Romania, worth EUR900 million, and the money is to enter the Romanian central bank's accounts most likely on Monday.

The IMF was initially set to discuss this EUR900 million disbursement mid-December but the Board meeting was postponed because Romania had failed to adopt the state budget, public sector wage laws and the pension reform in due time.

A joint review mission of the IMF and the European Commission was in Romania at the end of October to asses progress under a EUR20 billion IMF-led bailout loan agreed in spring 2009. Romania has so far received EUR15.2 billion of the loan.

In May 2009, Romania agreed with the IMF on a EUR13 billion stand-by arrangement, part of a EUR20 billion financial support that includes funds from the European Union, the World Bank and other international lenders.

An IMF delegation is expected in Bucharest on January 25 to review the current arrangement and hold talks with Romanian authorities on a new, one-year precautionary deal worth EUR3.6 billion.

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