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Opposition Leaders Criticize 2019 State Budget Project, Say Growth Projection Is Unfeasible

Leaders of Romanian opposition parties heavily criticized the Government’s proposed state budget project for 2019 on Friday, with the main point of discontent revolving around the economic predictions on which the budget is based.
Opposition Leaders Criticize 2019 State Budget Project, Say Growth Projection Is Unfeasible
Ionut Preda
01 feb. 2019, 14:17, English

Liberal Party leader Ludovic Orban and USR Chairman Dan Barna criticized the Government for basing the budget on a 5.5% economic growth rate and 2.8% inflation rate, which they say cannot be attained.

“This budget is science-fiction because it bases its phases on fictions, respectively an inflation rate of 2.8. Let’s remember that the annual inflation rate, which was nearly zero at the moment PSD-ALDE took the Government, reached an extremely high level, of 5.4 annualized rate, and currently is at 4.6 annualized rate,” said Orban.

The liberal leader also pointed out that the draft budget quotes a 4.67 RON to EUR exchange rate, with the effective rate currently set at 4.76. Orban also criticized the Government for ignoring projections made by international institutions regarding the country’s economic growth for 2019.

“How can you commit to this level of economic growth, of 5.5%, when all projections made by prestigious international institutions indicate a maximum economic growth of 4% and, most probably, this economic growth will not surpass 3.5%?” the Liberal Party chairman rhetorically asked following a Friday meeting of foreign affairs ministers within the European People’s Party.

USR leader Dan Barna also criticized the budget’s projected growth rate, stating that the chances to reach the figure were “practically inexistent”.

“The income it is based on is preposterous, we are talking about a 5.5% growth, but last year we had 4%, while Europe is in stagnation and all economic growth at European level is declining. We are practically speaking of income which cannot even be accomplished theoretically,” said the opposition leader.

Romania’s government targets a deficit of 2.55% of gross domestic product and expects economic growth of 5.5%, according to the 2019 state budget plan published late on Thursday.

It sees inflation at 2.8% this year, close to the central bank’s projection of 2.9%.

Consolidated budget revenues are projected at RON341.4 billion, or 33.4% of GDP, and expenses are seen at RON367.5 billion, or 35.9% of GDP.