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FinMin Citu: the economy goes through a difficult period in Q2


The minister of public finances Florin Citu considers that in Q2 the economy will pass ‘ through a difficult period’ but he states that ‘ rebounding in Q3 is almost a certainty and rebounding in Q4 is a basic scenario for this moment’ . He says that the measures taken by the executive, such as the IMMInvest program,the support of technical unemployment or the postponement of the installments to banks, ‘ everything proved to have results and it is obvious now’.

 ‘But the most important is that trust indicators for May show a coming back of the Romanian economy over other states in the region, and if you take this indicator – it is about the one published by the European Commission – you will see that Romania is the country where trust increases. It is the trust coming from the economic agents, trust which we have to support with efforts from the budget and you know well that there follows an investment economic plan’ the minister of finances said.

He also made a balance of expenses made by the executive in May. Citu showed that every month the government has to borrow ‘ as we have expenses and many of these bills come from the past’.

According to the minister, the expenses for May were 8.9 billion lei spent on personnel, as in 2017 the same expenses were 5.6 biliion lei.

Expenses with goods and services were in May this year one billion lei, while expenses for pensions are 6.4 billion lei against 4.5 billion lei in 2017.

There were also COVID-19 expenses. Thus there were paid 2.3 billion lei – technical unemployment, 454 million lei – aid for other professions, 59 million lei for quarantine expenses and 9 million lei aid for parents who stayed home to supervise children, plus medical leaves 637 million lei.

Citu announced that the three billion lei  for the medical leaves which were not paid at the level of November last year were  paid, as well as the bills not paid from PNDL and VAT reimbursements. He explained that the former government spent at most one hundrd million monthly for these medical leaves that is why the sum to pay was three billion lei.

The minister of finances said that last month the expenses with investments made by the government were 13.1 billion lei, being the biggest sum for investments over the last decade. ‘ In May 2020 we got with the expenses for investment,s in global economic crisis, in a difficult moment for all economies in the world, we got to the sum of 13.1 billion lei. Why this sum is important? It is the biggest sum over the last ten years. As a comparison, in 2017, there were spent 4.3 billion lei and the economy was in full swing then, you know very well what they were telling us. So, we got it, we also paid the increased pensions, the increased salaries, Covid expenses, to spend 13,1 billion lei for investments, the biggest sum offered to investments in ten years – and this is the secret which led to the economic growth of Q1. We allocated money for investments, as we said at the beginning of the year and we will allocate money to investments as through investments you can grow and pay the other expenses. Moreover, expenses with investments got in May at the level of monthly expenses with pensions and salaries. We want to go further, to surpass  the expenses with pensions and salaries with expenses with investments. This is the only way to grow ‘ Citu said.