Romania's 7-8% Econ Contraction, A “Disaster” For Business Environment - Assoc

The economy contraction of 7-8% forecasted for 2009 will represent a "big disaster" for business environment and will trigger the bankruptcy of companies and the reorganization of certain economy subsectors, said Florin Pogonaru, head of Romanian Businessmen Association AOAR

6 views

"(…) Whether we like it or not, this is the situation and we have to be ready. The government should not waste its ammunition, namely funds received from EU and the other international institutions, to rescue small and big companies in distress," Pogonaru said.

AOAR head said that businessmen asked government representatives for removing bureaucracy from administration and the participation of investors in drafting the new Fiscal Code.

According to a government releases, businessmen asked government for drafting measures that would lead to more predictability and stability in the economic environment.

According to Cristian Parvan, secretary general of Romanian Businessmen Association, the finance minister has told investors the government would ask the International Monetary Fund to accept a budget deficit of 7% of the gross domestic product for 2009, given an economic contraction estimated at 7%-8%.

Official sources told Mediafax early July that the IMF is working on a new macroeconomic framework that will be based on a GDP contraction between 7% and 8%.

Thursday, Pogea said the GDP may fall 8% for the whole of 2009, adding the forecast contraction of 4.1% agreed with the IMF would be revised.

Romania's first-quarter GDP fell 6.2% on the year, but several analysts estimated a sharper contraction for subsequent quarters.

If you liked this story, please follow MEDIAFAX.RO on FACEBOOK »

The content of mediafax.ro is for your information only. Republishing or using this content is forbidden without express consent of MEDIAFAX. For this consent, please ask for it by mail at vanzari@mediafax.ro.