€900m set for Romania as spending cuts satisfies IMF

ROMANIA IS poised to receive the next €900 million tranche of a €20 billion loan after the International Monetary Fund gave a positive assessment of government efforts to slash its budget deficit.

The IMF’s praise for Romania’s painful austerity measures, which have prompted large demonstrations, stood in contrast to its decision last month to halt funding talks with neighbouring Hungary after its government resisted IMF promptings to reduce its deficit target and scrap a controversial bank tax. Jeffrey Franks, head of the IMF mission to Romania said: “Once the Romanian authorities have fulfilled the preconditions, the board will . . . give its go-ahead to the disbursement of a new instalment.” The precondition is that the government pay €470 million in arrears to private companies.