Ionut Dumitru ( Fiscal Council) the governmental debt does not drop, and the leu does not go up
The last data made public by the finances show a drop of the governmental public debt this year, and the average exchange rate leu-euro will be 4.42 lei. Ionut Dumitru, the chairman of the Fiscal Council stated that both prognoses are non-realistic.
The service of governmental public debt will drop this year at 8.1 billion euro from 13.7 billion in 2016.This will go up to 9.344 billion euro in 2018 and will go down at 8.319 billion lei in 2019.These are the latest data made public by the ministry of finances.
On the other hand, the finances show an average exchange rate leu-euro for this year of 4.42 lei, the national currency getting stronger in 2018 the rate being 4.4 lei for the euro.
‘On a more realistic projection,the necessary for financing is somewhere similar to that of last year as the budgetary deficit will be over 3%. The Fiscal Council has a projection of deficit for 2017 od 3.6% for European Standards and not under 3% as the government says. And the potential of appreciation of the rate is very limited, even non-existent. We hope we will have a stable exchange rate, somewhere 4.45 - 4.5 lei for 2017and 2018’ stated Ionut Dumitru, the chairman of the Fiscal Council.
Cristian Parvan, the general secretary of the Association of Business People of Romania (AOAR) said that the elements are optimistically estimated, and all calculations connected to the volume of the foreign debt, as all figures connected are conditioned by the growth prognosis of GDP according to the debts made public by the National Prognosis Commission.
He says that all data are optimistically estimated, together with economic growth supported until 2019. Similarly, the budgetary deficit will not be over 3% hoping, optimistically that the financing will be made at the present costs of international financing.
‘The hypothesis can suffer negative alterations, connected to the stoppig of the policy of ‘ quantitative relaxation’ promoted by the Central European Bank (BCE), following the increase of interest practiced in agreement with loans There are conditions for this change of policy at the level of BCE, the inflation reaching, after seven years of crisis, the level of 2% at the level of the euro zone. Similarly, we are talking about the policy of growth of the interests practiced by the Federal Reserve of the US’ considers Cristian Parvan.
He shows that the solution proposed by AOAR is a programme for the passage in stages from practically 100% foreign refinancing or through banks in Romania to the increase of the debt to the Romanian citizens, to which they are required the bonds, with maturities of 10-15 years, traded through the BVB, bonds with stimulating interests (2-3%).
Parvan considers that another threat, which could affect significantly the refinancing costs, may be the alteration, justified or not, of the country rating by all international agencies. And in this case it is possible to increase the costs for refinancing of the public debt.
As regards the estimated exchange rate, this could not be argued, at most favoured by a policy of change of the Romanian economic structure to get from industries and low tech services, to products and high tech services, namely intelligent investments and the increase of the number of work places which require superior competences’the AOAR secretary general said.