Prima pagină » English » WB: Romania Vulnerable To Sovereign Debt Crisis

WB: Romania Vulnerable To Sovereign Debt Crisis

Romania is among countries that are vulnerable to the sovereign debt crisis in Europe, because its financial sector is closely linked to highly indebted states in the continent, a report from the World Bank showed Thursday.
WB: Romania Vulnerable To Sovereign Debt Crisis
10 iun. 2010, 13:13, English

Though the delicate situation in the eurozone area is likely to see a gradual and „smooth” resolution, the World Bank doesn’t rule out a „disorderly” adjustment, which could have serious impact on both high-income and developing countries.

„Also at risk are countries whose financial sectors are closely linked to these highly indebted countries. Albania, Bulgaria, Romania, and Serbia are economies that have benefitted in the past from heavy capital inflows from Greek financial institutions,” the World Bank said in its summer 2010 Global Economic Prospects report.

The institution warns that a default or a major restructuring of the five most indebted high-income states in the EU (Greece, Spain, Portugal, Ireland and Italy) could have grave consequences for the global economy, both because the full-fledged recession these countries would be plunged into and because of the potential knock-on effects on crediting institutions elsewhere in the world.