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Fiscal Council’s Daianu: Romania could end 2022 with budget deficit of under 6%

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Romania could end 2022 with a budget deficit of less than 6%, depending on the budget revision in November, Daniel Daianu, the president of the Fiscal Council, said in a video message at the third edition of the Banking Forum event, organized by Financial Intelligence, according to Agerpres.

„Also in Romania, although the National Bank of Romania (BNR) did not practice QE, it intervened in the market. It was noticed that, at certain moments, the functioning of the financial market here, of the secondary market, required certain interventions from the BNR, as happened everywhere. And the most recent case, in the UK, when the Bank of England was forced by budget policy errors to intervene because they were having big difficulties with pension funds. And there is a lesson here. Don’t play with budget policy, continue to be cautious, do not experiment! An experiment was tried there, but it was wrong. The markets penalized it and it led to the change of the finance minister. Why do I make this observation? Because Romania is in the excessive deficit procedure. We have a start of budgetary consolidation that will be visible this year. I think we will have a budget deficit that, if the impact of the compensation scheme is not be very large in terms of the relationship between expenses and revenues could be around 6%, and even drop below 6%, depending on the budget revision that will be carried out in November, as is traditional, and we will see then what the draft budget will be,” said Daniel Daianu.

He explained during the intervention that there are fractures in the global economy, which were caused during the pandemic on all levels. All these fractures were detectable even before the onset of the pandemic. They are intensifying, production and supply chains that become regional, including under the impact of geopolitics and the great global confrontation that has started for some time between the United States, the Western world and China, mainly, which is increasingly an economic and technological rival of the United States of America.

Agerpres is a media partner of the event organized by Financial Intelligence on Friday.

Agerpres

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