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April 11, 2021

European Commission disapproves of Fiscal Code * IMF mission to Bucharest cancelled

The European Commission has not reached an agreement on the Fiscal Code with the Romanian authorities but will decide during the Ecofin meeting on July 14 what is the stage of its agreement with Romania. At the same time, the International Monetary Fund will no longer conduct its evaluation visit next month because it will already have the conclusions of the European Commission’s mission, Finance Minister Eugen Teodorovici (photo) stated on Thursday.

“We failed to agree on a single point: the Fiscal Code. There will be the Ecofin meeting on July 14, the meeting of the Finance Ministers, and the International Monetary Fund will obviously not come (in July – editor’s note) because it already has the conclusions from the European Commission. (…) This technical mission to Bucharest will prepare a report for Ecofin and next week we will know its contents ahead of the Finance Ministers’ meeting and we will come up with a point of view,” Eugen Teodorovici pointed out at the end of the talks with the representatives of the European Commission’s mission.

He pointed out that the European Commission’s concern refers to the budget impact that the Fiscal Code will have starting next year. According to the aforementioned source, the budget deficit target assumed will be temporarily surpassed, the estimated level being of 2.9 per cent of GDP in 2016. Teodorovici however claims that the deficit could drop from 2.9 to 2.5 per cent of GDP during the substantiation of the 2016 budget.

The Finance Minister underscored the fact that many EU member states register excessive deficits, far above 3 per cent of GDP, and Romania finds herself in the situation of having to adopt such measures in order to consolidate its economy even more.



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