Romania, IMF Highlight 10 Public Companies For Monitoring

Romania's Government and the International Monetary Fund drafted a list of ten state-owned companies subject to economic performance monitoring in order to reduce the volume of subsidies, according to the additional letter of intent to the EUR12.95 billion stand-by loan signed with the Fund.

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Some of the state owned companies to be further monitored are railway companies CFR, CFR Marfa and CFR Calatori, pitcoal mining company CNH, electricity producer Termoelectrica, and the public roads authority CNANDR.

Thus, following a first evaluation, the monitoring will focus on these enterprises. During the second review, after the monitoring system of the Finance Ministry has been refined, quarterly indicative targets for 2010 will be established on the operating balance (earnings before interest and tax, or EBIT), net of subsidies, of the 30 largest enterprises by total expenditures (as of 2009).

The document confirms the data previously published by MEDIAFAX as regards the duties of state companies.

Also, the Government undertakes to improve the monitoring system of state companies facing the biggest problems, in order to set half-year performance targets upon IMF's next evaluation.

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.

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

The second IMF mission will come to Romania end-October or early November, for a new review of the stand-by loan.

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