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Romania Govt Proceeds To Accept IMF 2nd Installment

The Romanian Government will meet Tuesday, at 4 p.m. local time, to approve the second tranche of the loan granted by the International Monetary Fund and the supplementary letter of intent to the stand-by agreement.
Romania Govt Proceeds To Accept IMF 2nd Installment
22 sept. 2009, 12:38, English

„According to the procedures, the second tranche should be approved in a government meeting, after the fund’s consent,” official sources told MEDIAFAX Tuesday.

The sources added the Cabinet would approve by an emergency ordinance the supplementary letter of intent.

Romania has sent the IMF a supplementary letter of intent to the stand-by agreement, after the review of the countr’s progress under the program supported by the IMF loan.

The IMF’s Executive Board Monday granted Romania access to the second tranche, worth EUR1.85 billion, from the EUR12.95 billion two-year stand-by loan.

Romanian 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.

After the first review of the arrangement, 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.