Cabinet is still waiting for the EC’s response with respect to postponing the Diesel fuel excise tax, Ponta told a banking conference.
The central bank is prepared to reduce mandatory minimum reserve levels (MRL) for leu and foreign currency-denominated liabilities next year, but at the moment the market’s liquidity surplus is EUR 2 billion, Mugur Isarescu, governor of BNR, told a seminar entitled ‘Romania of Investments, mediafax reports. Romania of Development’ organized at the central bank. The event was also attended by PM Victor Ponta and cabinet ministers Dan Sova, Liviu Voinea, Daniel Constantin, and Eurgen Orlando Teodorovici.
The governor started his speech with a remark on the public’s mass-media influenced opinion that the only thing missing from the economy is money, an idea which he disproved by way of market liquidity figures. He argued the central bank introduced MRLs for foreign currency-denominated liabilities between 2006 and 2008 in order to discourage the “crazy increase” in currency loans, particularly where unsecured loans to natural persons were concerned, which reported an 80 percent dynamic.
Since the crisis set in, BNR has reduced the RMLs in euros from 40 percent to 20 percent. “We are prepared to keep lowering it next year. The leu-denominated MRLs are at 15 percent and we would like to reduce this figure, but we also have a market liquidity surplus of eight billion lei. We wish to reduce leu-denominated RMOs next year, currently at RON 16 billion, the equivalent of EUR 4 billion,” Isarescu concluded. He also underlined that Romania needs to double its current 2 percent economic growth, so as to make up for discrepancies compared to the EU. However, this should be achieved without “ruining” the 2 percent budget deficit or the current account and inflation deficit.
In his turn, Prime Minister Victor Ponta stated he is still waiting for the European Commission’s opinion towards postponing the introduction of the 7 eurocents excise tax on Diesel fuel. After the Commission’s response, he added, he will discuss the matter with President Traian Basescu and suggest the promulgation of the state budget.
Ponta said he expects the response by Wednesday. The two major aspects that jeopardize Romania’s growth are the inclusion of major investment projects in political battles, on the one hand, and the inability to undertake long-term projects, on the other, he said. He also suggested a “Snagov-type” reunion for 2015, concerning Romania’s economic development.