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IMF: Romania salary expenditure to be cut down to 2005 levels

The salary expenditure in the Romanian public sector will be cut in 2011 down to the 2005 levels of 7.4 percent of gross domestic product, the International Monetary Fund (IMF) representative in Romania Tonny Lybek said at the Palace of Parliament on Tuesday.

He stressed the Romanian economic programme is backed by the IMF, the European Commission, the World Bank and other international financial institutions and expectations show Romania will enact the commitments made.

According to the commitments made by Romania to the international partners, the country's expenditure on pensions and other social aid should drop to 12.8 percent of GDP in 2011 down from 13.4 percent of GDP this year and 13 percent in 2009.

The salary spending in the Romanian public sector has grown year after year since 2005, to 8 percent of GDP in 2006, 8.1 percent of GDP in 2007, 8.9 percent of GDP in 2008 and 9.5 percent of GDP in 2009; such spending is anticipated to go down to 8.2 percent of GDP this year.

The IMF projection for Romania points to an economic growth of 1.5 percent in 2011 and a budget deficit of 4.4 percent of GDP.

Lybek said Romania is on the road to economic recovery as the foreign demand is picking up, after it had faced two shocks during the downturn - namely a lower foreign demand and slowed down capital inflows respectively. The IMF official said this crisis can be an opportunity for reform and stressed that while Bulgaria had recorded budget surplus during its times of economic growth, Romania had had a different behaviour and the budget deficit had gone deeper, although the economic growth had been a record one.

Sursa: http://www.agerpres.ro

Tags: percent romania economic expenditure salary

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