Romania Engages To Raise Tariffs Of 10 Largest Loss-Making Public Cos

„The government remains committed to improving the performance of public enterprises. The 10 largest loss-making public enterprises met the indicative target for operating losses in the second quarter,” says the letter of intent to the stand-by agreement signed by Romania with the International Monetary Fund, obtained by MEDIAFAX.

However, the authorities said that these 10 companies’ arrears continued to increase, suggesting that further measures will be needed to comply with the European Union conditionality on a quarterly reduction of arrears.

„The government plans to implement measures to improve the revenues of these companies (via higher tariffs), as well as cost reductions via staff cuts and restructuring,” the document reads.

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The ten state-run companies under monitoring are: railway company CFR SA, passenger rail company CFR Calatori, bituminous coal mining company CNH, electricity producer Termoelectrica, national company of motorways and national roads CNADNR, subway company Metrorex, rail freight company CFR Marfa, power producer Electrocentrale Bucuresti ELCEN, rail electrification company Societatea Comerciala Electrificare CFR and the national administration of land improvement ANIF.

Romania and the IMF last year signed a EUR13 billion loan agreement, part of a larger EUR20 billion aid package that includes funds from the EU and other international lenders.

Joint teams from IMF and the EU arrived in Bucharest July 26 for the fifth review of Romania’s agreement.

Following the mission, the IMF will decide whether to disburse another EUR914 million to Romania.