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June 23, 2021

EUR adopted in 2015, analysts sceptical

The government has approved the Convergence Programme 2012 that stipulates that Romania will adopt the EUR in less than three years’ time. Until then, Romania will have to meet drastic accession criteria, adevarul.ro points out. Our economy would basically have to become an exemplary business environment, with almost perfectly stable prices, extremely small deficits and a relatively easy to cover external debt. All of that in less than three years’ time, namely by January 1, 2015. The main goal included in the government document is lowering the structural deficit below 0.7 per cent of GDP by 2014. “The macroeconomic framework forecast is based on a GDP growth of 3.1 to 3.9 per cent, approximately one percentage point above the potential, considering the positive contribution brought about by investments and especially by the absorption of European funds. Internal demand will represent the main economic growth engine in 2012, improved employment and a lower inflation rate will support revenue growth and will contribute to reinvigorating private consumption. This year the inflation rate is expected to remain at a low level, around 3.5 per cent at the end of the year, within the National Bank’s target range,” government spokesperson Dan Suciu stated at the end of the government meeting on Wednesday. “In what concerns public finances, the specific goal of budgetary policies consists of continuing to adjust the budget deficit, the planned target being: 2.3 per cent of GDP in 2012, 1.5 per cent in 2013, 1.2 per cent in 2014, 0.9 per cent in 2015; the figures are calculated on the basis of ESA methodology,” the official added. The proper moment for Romania’s accession to the Euro Area would be 2020, when there will be a real convergence, economic analyst Florin Citu stated. “Romania has chances to meet the nominal convergence criteria by 2015, but it’s impossible to register significant progress in the real convergence process by that time. In order to avoid a fate similar to that of Greece or Portugal, Romania has to lower the difference in productivity,” Citu explained. The report shows that it is impossible for Romania to reduce the lag between it and Euro Area states in what concerns competitiveness, and adopting the Euro “will jeopardize the economy in competition with the other Euro Area countries.”

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