Romania Eyes Guaranteeing Loans Of Pvt Cos For Co-Financing Of EU-Funded Projects

The Romanian Government plans to also guarantee the loans contracted by private companies for the co-financing of several projects backed from European Union funds, people close to the matter told MEDIAFAX Wednesday.

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They said Prime Minister Emil Boc on Wednesday asked competent bodies to seek legal ways to ensure these state guarantees will not be considered state aid.

The Government discussed the issue in its weekly meeting Wednesday.

In February this year, the Romanian Government decided to guarantee the loans contracted by local authorities for the co-financing of EU-banked projects, within the ceiling of 2.6 billion lei (EUR1=RON4.1751).

Boc said at the time that the Government plans to use state guarantees to increase the absorption rate of EU funds.

In September last year, the IMF agreed to increase the ceiling on public guarantees to RON7.7 billion in 2009 and to RON8.6 billion in 2010, from RON6 billion initially allowed.

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