Romania, IMF Agree On 2010 Draft Budget

Speaking after a meeting with Romanian interim Finance Minister Gheorghe Pogea, Franks said the next challenge for the authorities in Bucharest is to send the budget to parliament for approval shortly.

Franks added Romania might be able to run a budget deficit of 7.3% of the gross domestic product in 2009, in line with the target agreed upon with the IMF.

In November, the IMF said Romania could exceed the 7.3% of GDP cap. However, things look better now, Franks said.

Romania, hit hard by the global crisis, relies heavily on a EUR20 million IMF-led loan package obtained in the spring.

The country has received so far around EUR7 billion from IMF in two installments, and was scheduled to get another EUR1.5 billion in December.

However, both the IMF and the EU had said they would delay new tranches until Romania has a functioning government.

Pogea said Monday that Romania might get the third loan tranche from the IMF in January, two months ahead of a new quarterly assessment mission from the Fund.

However, he said the new government must endorse the 2010 budget - which is a prerequisite to get the installment.

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