EU To Assess Romania’s Budget Deficit Corrective Measures

In 2010, Romania pledged to bring the budget deficit down to 5.9% of GDP, from a gap estimated at 7.3% of GDP in the last year.

The Commission might extend until 2012 the deadline by which the states running a high budget deficit must bring down the gap to below 3% of the gross domestic product, European Commission’s representative Fabienne Ilzkovitz said Wednesday in Bucharest.

EU’s executive arm assessed the action taken by Malta, Lithuania, Latvia and Hungary in respect to the correction of their respective budget deficits and concluded they took effective actions in that respect, the Commission said in a statement.

It recommends an extension by one year to 2011 for Malta and 2012 for Lithuania.

As to Hungary and Latvia, the EU concluded that they complied with the Council recommendations but they need to continue their efforts to bring the deficits below 3% by the agreed deadlines of 2011 and 2012, respectively.

The EC’s proposals and recommendations as regards the excessive deficit procedures will be forwarded the EU’s Council.

The Commission proposed to open the excessive deficit procedure for a number of 20 EU-member states and recommended deficits correction by 2010, 2011 and 2012, respectively, for complying with the EU limits.

End June, the EU finance ministers asked Romania to take corrective measures and bring the budget gap to below 3% of the GDP by 2011.

Last spring, Romania has inked an agreement with the IMF, the EU and other international lenders for a EUR20 billion financial package, supported by a EUR13 billion stand-by loan from the fund.