Romania’s 2008 government deficit might be below 2.7 percent
BUCHAREST – Romania may aim for a budget deficit of 2.5-2.7 percent of gross domestic product next year, according to EU methodology, and could undershoot the goal if revenue growth remains strong, a Finance Ministry official said yesterday. The ministry’s head of the macroeconomic department also reiterated expectations this year’s deficit will amount to roughly 2 percent of GDP, according to EU accounting rules, or some 1.5-1.6 percent according to Romanian calculations. Romania has targeted a 2007 budget deficit of 2.8 percent of GDP, which the EU said could bring its shortfall above the bloc’s ceiling according to its calculations. «(A deficit of) 2.5-2.7 percent is a feasible target… I am a hundred percent sure that it will be slightly lower… at 2-2.5 percent,» Dorin Mantescu told Reuters in an interview. Mantescu also said the recent depreciation of the leu currency was temporarily, arguing the currency should appreciate by 6-7 percent in real terms in the medium to long term. He forecast GDP growth of 5.9-6 percent this year, despite some growth slowdown in the second quarter due to drought. He also said he expected Romania’s growing current account deficit to stabilize by 2009-2010.
