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Valentin Lazea: Romania’s economy is over-loaded

Foreign deficit is the main imbalance of the Romanian economy.

Romania’s economy is over-heated and the pattern of consumption based economic growth has reached its limits, the National bank of Romania (BNR) chief economist, Valentin Lazea said, cited by HotNews. “The high economic growth in Romania over the past few years was based on a pattern, I would not call it a wrong one, but an unsustainable one”, as he said. Lazea affirms that in other countries such as Hungary, Czech Republic, Slovakia or Poland, economic growth relies less on consumption and more on exports. “An over-heated economy means an economy functioning at its upper limit of capacity and which because of being over-heated, has the trend to register either inflation or foreign deficit, or a combination of both of them”, Lazea said. PNL Deputy, Mircea Ciopraga, affirms that Romania had a solid economic growth over the past eight years. Evidence to this, according to Ciopraga, people’s savings advanced by 50 per cent, and they amounted last year to RON 129 bln. Valentin Lazea said that Romania consumed more than it produced and the Government committed too high expenditures. “The main imbalance of the Romanian economy is its high foreign deficit, which means that imports outnumber exports by much and this gap accounts for 14 per cent of the gross domestic product, compares to 10 per cent one year ago, and compared to 8 per cent two years ago. Hence, an explosive growth of the deficit. This deficit indicated, in fact, another economic aspect, and this is that growth relies in our country too much on consumption and on consumption from import, respectively”, the head economist of BNR said. Reasons of RON depreciation, in an order of importance, included: foreign crisis, governmental policies, money given as salaries at the end of the year, foreign investors conduct, foreign banks conduct. “Briefly, any goods in excess lose in price. RON being in excess in the market and nobody having anything to do with it, it becomes cheaper”, Lazea added. BNR may raise the reference interest Valentin Lazea, chief economist of National Bank of Romania (BNR), declared that “BNR could raise again the interest rate, during the next session”, according to HotNews. Lazea added that the current economic growth was not a sustainable one, being “maintained by consumption only”. “Romanians consume more than they produce, which means that they have stretched more than normal”, Valentin Lazea said. Sursa: http://www.nineoclock.ro

Tags: lazea economy romania growth bnr economic foreign valentin deficit consumption

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