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RON 900 mn out of the Reserve Fund, used for the payment of debts in 2010

The Budgetary Reserve Fund benefitted in 2010 from approximately of 2.58 billion lei out of which 900 million lei had as a destination the payment of debts, especially for the Ministry of Transport and Infrastructure (MTI) and the ministry of economy, commerce and business environment (MECMA) says in the annual report of the Fiscal Council.

According to the quoted source, out of the sum last year, 1.9 billion went to the central administration and approximately 660 million lei to the local administration.

Out of the allocations for the central administration, approximately 900 million lei had as destination the payment of debts, especially for MTI and MECMA.

As regards the public debt of Romania, the report of the Fiscal Council shows the fact that its significance has been increased in 2010, the share in the GDP going up to 37.75% from the level of 30% recorded at the end of 2009 as the economic contraction went on and a budgetary deficit of 6.5% out of the GDP.

According to the quoted data, the governmental public debt represents 94.3% of the total, as compared to 92.65% in 2009, while the share of the public debt is 5.9% going down against the level of 7.35% of the previous year.

The state loans have the highest share in the total of the pbulic debt, adding 40.39% of the total, being followed by state bonds by 18.66%, treasury bonds by 17.91% while eurobonds have 5.76% of the public debt financing.

As regards the structure of maturity of the newly issued state bonds, the short-term financing had the main importance.

Thus, the treasury bonds with maturity of over one year have 74.6% of the value of new loans, while long-term financing is relatively reduced, 3 year bonds accumulating only 16% of the value of new loans. Bonds with maturity of 5 to 10 years add 6.15%, 3.28 % respectively out of the total.

The cost of drawing new resources had a positive evolution, the yield of state bonds going under 7% at the end of 2010 against the level of 10% recorded one year before, as the improvement of risk associated to Romania and an excess liquidity in the banking system happened, the report shows.

The Fiscal Council is an independent authority, made up of five members with experience in the domain of macro-economic and budgetary policies, which support the activity of the government and the parliament in the process of drawing up and dealing with fiscal-budgetary policies, in order to ensure the quality of macroeconomic prognosis which underpin the budgetary projections and the fiscal-budgetary policies on a medium and long term.

The members of the fiscal council use their mandate according to the law 69/2010 and according to it they will not require or receive instructions from the public authorites or from any institution or authority.

The chosen chairman of the Fiscal council is the head economist of Raiffeisen Bank, Ionut Dumitru and the vicechairman is Razvan Stanca, the head economist of BNR.

Romania's external debt up 11.8 pct last year

Romania's external debt hit 90.76 billion euros in 2010, up 11.8 pct from 2009, shows the Annual Report published by the Fiscal Council. The official data shows that with 72.019 billion euros at the end of 2010, Romania's medium- and long-term debt accounted for 79.3 pct of the total external debt, by 9.5 pct higher compared with the level registered on December 31, 2009. At the same time, the short-term external debt had a more dynamic evolution, rising 21.6 pct to 18.746 billion euros, ie 20.7 pct of the total external debt.

According to the Fiscal Council, on the background of a downward trend of inflation in the first half of 2010 and of the continued economic decline, the National Bank of Romania (BNR) lowered the key interest rate from 8 pct early last year, to the current 6.25 pct per annum.

The Fiscal Council is an independent authority made up of five members with extensive experience in macroeconomic and budget policies, which is tasked with supporting the Government and Parliament's activity of working out and carrying into effect tax and budget policies, with a view to ensuring a high quality for macroeconomic forecasts underlying budget projections and medium and long term tax and budget policies.

The elected chairman of the Council is Raiffeisen Bank chief economist Ionut Dumitru, and BNR senior economist Razvan Stanca acts as Tax Council deputy chairman.

Sursa: http://www.actmedia.eu

Tags: total public bonds policies external payment according debts budgetary billion council fiscal bnr

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