Stiri	Stiri afaceri	Stiri companii	Evenimente de afaceri

Governor Isarescu: Stimulating consumption, bad idea for our economy

Stimulating consumption is a stupid idea, and what is more important is that Romanians work more to boost production, Governor of the National Bank of Romania (BNR) Mugur Isarescu told a debate on Wednesday.

'Consumption should be restricted because domestic production is smaller than the demand. Stimulating consumption now would mean going back to the big deficit of two-three years ago. The idea about stimulating consumption is a stupid one. Any such idea sticks well in public discourse. Consumption will eventually increase; there is no doubt about it, but after an economic recovery,' Isarescu explained.

He added that letting Romanians work for economic recovery is an important solution.'Recession was tougher in Romania and external financing required adjustments,' said Isarescu. He pointed out that there are 5 million pensioners in Romania and only 4 million employees, which should be taken into account when consumption recovery is mentioned.

Isarescu pointed out that Romania needs a sustainable economy that requires three things.'The National Bank has mandated me to tell you strongly that what we need to do now is sustainable economic growth. I believe there are three things we need to do: stimulating work, than stimulating work and once again stimulating work. If we do all these three things there is no way that there will be no economic growth. I do not believe in the catastrophic scenario that says there is no exit for us. Stimulating work can be achieved by attracting investments,' said Isarescu.

Social burden should be alleviated

Romania needs to make its labour market more flexible, because flexibility means increased productivity, Governor of the National Bank of Romania (BNR) Mugur Isarescu said on Wednesday.

'Social burden should be alleviated. We have a problem here. Reducing the social security contributions will be welcomed when sustainable, but reducing the social burden on employers is essential,' said Isarescu.

He added that employers are currently squeezed tight when it comes to social burden and that is why they turn to undeclared labour and thus avoid labour taxes.'Many people do undeclared work. I do not think you can stop undeclared labour in a single decision,' Isarescu told a '2011 Financial and Banking Year' conference on Wednesday that discussed where from economic growth might come and what are the business lines to bet on, organised at the BNR headquarters by the FinMedia media trust in partnership with the Association of Romanian Banks (ARB).

Romania experiences unsteady economic growth for 20 years

Romania has had an unsteady economy for the past twenty years and things will stay the same in the next two decades, Romanian Central Bank (BNR) Governor Mugur Isarescu told a specialist debate.'Whence and how could the economic growth come up in 2011? Out of a hat, by chance, one might say. The economic growth is a combined end product of workforce. Basically, the national income arises from the employed workforce and productivity. Romania has experienced a shaky economic growth for 20 years, low as demand and large as offer. We cannot foresee another type of economic growth for the next 20 years,' Isarescu said.

The Central Bank official highlighted the fact that an economic growth relying solely on loans was not suitable. 'This type of economic growth is not feasible either socially, politically or economically. A country cannot keep borrowing money for ten years and return that money for another ten years, and so on,' Mugur Isarescu warned.

Sursa: http://www.actmedia.eu

Tags: isarescu growth stimulating economic romania consumption economy governor there years bnr bet

Articole similare