Econ Min: Romanian ’07 Budget Def 1.4% Of GDP

"Through a severe control of spending in November and December we have managed (…) to achieve half the budget deficit limit we had established in this year’s budget law,” Vosganian said in a press conference.

Vosganian also said the ministry tried to coordinate the ministry’s fiscal policies with the central bank’s inflation targeting policy. In 2007, inflation is seen at around 6%, one percentage point above the central bank’s upper limit of 5%.

The Romanian Parliament approved on Thursday next year’s budget which sees a deficit of 2.7%.

Earlier this year, the European Union has warned newcomer Romania that it may face disciplinary action as its 2007 deficit is likely to exceed the E.U. limit of 3% of GDP. According to E.U. accounting methods, Romania’s budget deficit will total 3.2% of GDP this year.

In 2006, Romania’s budget deficit, according to the European System of Accounts, stood at 1.9% of GDP, compared with the 1.7% of GDP calculated by the Romanian authorities.