Romanian PM Tariceanu: We cannot afford electoral charity

Marţi, 5 februarie 2008, 14:15 English | Business

Romanian PM Calin Popescu Tariceanu, Finance minister Varujan Vosganian and National Bank (BNR) Governor Mugur Isarescu met Tuesday to discuss inflationary trends in Romania. The head of government said in a press conference following the meeting that maintaining economic growth was the only solution to improve wealth for the citizens of the country and underlined that 2008 would be a year of deep thinking and less electoral charity, despite parliamentary and local elections being scheduled this year.

As a consequence, salary growth would not exceed 11% this year, he said.

PM Tariceanu said Romania needed careful policies to keep the pace of growth reported over the past three years.

He said that authorities needed to keep into consideration the evolution of inflation and a balance between inflation and salary growth. He warned that unless a cautious salary policy was applied inflation was bound to grow.

He said he noted a frenzy of spending at local administration level at a time when the government tries to prevent higher budget spending despite potential higher incomes. He said the budget deficit must fall in line with the Maastricht criteria and not exceed 3%.

For his part, BNR Governor Mugur Isarescu said an economic growth of 6% was targeted for 2008. He warned that salary growth should not exceed labor productivity growth because that would reflect on the national currency value.