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Govt Ordinance On Additional Letter Of Intent With IMF Published In Official Gazette

The Government Emergency Ordinance on approving the additional letter of intent to the EUR12.95 billion stand-by loan signed by Romanian and the International Monetary Fund was published Wednesday in the Official Gazette, thus enabling IMF to grant the second tranche of the loan.
Govt Ordinance On Additional Letter Of Intent With IMF Published In Official Gazette
23 sept. 2009, 10:21, English

The agreement with IMF confirms the data previously published by MEDIAFAX as regards the terms of the additional letter of intent.

Romania agreed in spring with the IMF on a EUR12.95 billion loan as part of a financial package totaling EUR19.95 billion, which includes funds from the European Commission and other international institutions.

In August, after the first review of the program, Romania and the IMF agreed to adjust some targets, such as allowing a higher budget deficit cap, from 4.6% of the gross domestic product to 7.3% of the GDP, due to a deeper-than-expected economic contraction. Romania’s GDP is currently estimated to fall 8%-8.5% in 2009.

Also, the government pledged to further slash public spending.

IMF’s Board Monday granted Romania access to EUR1.85 billion of its loan, bringing the total disbursements to EUR6.85 billion so far.

Romania will use half of the EUR1.85 billion to finance the budget deficit, according to Prime Minister Emil Boc.

The third tranche of the loan, worth of EUR1.5 billion, should be released in December, after the second quarterly review of the loan arrangement.