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PM Ponta: By commitments made to EC, IMF we propose transparent manner of stability, development


The Government, by the commitments it made to the European Commission (EC) and the International Monetary Fund (IMF) proposes a transparent manner before the voters' legitimate representatives - the lawmakers - by which Romania should secure the stability and predictability absolutely necessary for it to continue the economic growth and the development it very much needs, Prime Minister Victor Ponta said in an address to a plenary sitting of Parliament on Tuesday.

He underscored each minister had negotiated for their own sector and, in his viewpoint, they had well negotiated the things Romania can pledge and the decisions for which they have support.

'I want to reiterate that all the Government's important decisions, in my viewpoint (...), must be showed to the Parliament of Romania and ratified by it, be they foreign policy decisions or important economic decisions. The Government manages the country, but the decision rests with the Romanians', Ponta underlined.

He explained that under the new deal, that will be backed by Parliament and ratified by the international partners of Romania, co-funding for the European Union funds will benefit from a drop to 5 percent from 15 percent, which at the current absorption rate amounts to more than one billion lei (some 223 million euros) in annual savings.

The prime minister said that, according to the letter, there is no intention of hiking the taxation, with the 16 percent flat tax rate to be maintained.

As regards the privatization programme, Ponta explained there are no major privatizations set.

'It is about the (Bucharest Stock Exchange) listing of 10 percent of (nuclear power producer) Nuclearelectrica, 15 percent of (natural gas company) Romgaz, 15 percent of Oltenia Energy Company and 10 percent of (hydro-electric power producer) Hidroelectrica. It is about involving the private capital in the energy companies in which the state keeps being a stakeholder, but we can, by such private capital, also have better management and resources to invest in upgrading', he said.

Ponta added the deal sets no obligation whatsoever for the Romanian Government or Romania to tax the authorized individuals or the copyright.

Ponta: I wish in two years we can say Romania no longer needs any agreement

Prime Minister Victor Ponta on Tuesday told the Parliament plenum that he wished that in two years' time Romania should no longer need any kind of agreement with the international financial institutions.

'The effects of the decisions adopted last year within the agreement signed by the former Government and concluded by the Government I run: the public employees' salaries were restored in 2012, through a 15 percent increase, the health contribution retained from pensioners with pensions over 740 lei was refunded within the limit endured by the budget, the minimum salary was enhanced from 700 to 800 lei, the minimum guaranteed income, by 8.4 percent in July 2013, the family support allowance, by 30 percent on the average starting July 1. We managed, through a Government-Parliament joint effort, to come out of the excessive deficit procedure in 2012 and we reduced the deficit calculated based on the ESA European system, we reduced this deficit from 5.7 to 2.9 and we are still going to have a reduction, so Romania should not depend on loans as much as until present,' the Prime Minister told the Parliament plenum.

The Premier pointed out that this was the third consecutive agreement concluded with the European Commission and the IMF and that within the first agreement Romania used a 20-billion-euro loan from the financial institutions.

'The policies implemented within the international agreements have led to the significant reduction in the funding costs. Romania's Government last week issued securities with the lowest interest rate over the past 23 years, 4.76 percent, thus having saved about 175 million euros in cumulated interests. I wish this is the last agreement that Romania concludes with the international financial institutions,' the Prime Minister underscored.

Precautionary agreement with IMF, a sign of stability, certified by international institutions, for investors

Our country needs a new precautionary agreement with the international financial institutions, Prime Minister Victor Ponta said on Tuesday, underscoring that Romania's big issue was the lack of loaning.
According to him, following the document signing, the state would borrow cheaper, at much lower interest rates.

'In Romania, let me say we are not going through a good period - it is in a way like a patient having come out of surgery and intensive care, who is now in his hospital room beginning to feel better. But we are far from reaching performance and, if you wish, the biggest challenge to Romania and to the Government I lead is that of coming out of this circle. (...) We are in a better period, but it does not necessarily mean that everything is going well and in this context we need to show a type of stability that, as much as we voice it, investors do not believe unless it is certified by international institutions. (...) This way, we borrow much cheaper. (...) Through this agreement, I want the large projects to be funded from the World Bank, from the European Bank for Reconstruction and Development, from the international institutions, and the money of the commercial banks in Romania to be left for the private companies of Romania. It is, if you wish, to me, who I do not run in the elections next year, also an ally against some populism outbreaks,' Prime Minister Victor Ponta told a video interview granted to AGERPRES.