The government approved on Saturday the planned budgetary modifications, Romanian Finance ministry Gheorghe Pogea announced. As a direct consequence, Romania's GDP might drop by 8 to 8.5% late this year, Pogea said. The deficit will register, by the end of the year 7.3% of GDP, compared to 4.6%, as initially estimated. The inflation target is 4.3%.

Here are some of the most important declarations:

the budgetary modification amounts to 5.25 billion lei

  • VAT revenue dropped by 4 billion lei due to a drop of economic activities
  • the state will insure necessary financial resources for pensions
  • we decided to allocate another 900 million lei for infrastructure works
  • Consolidated budget revenues dropped this year by 17.4 billion lei (representing 3.5% of GDP) compared to initial estimates
  • after the modifications, revenues amount to 31.6% of GDP and spending to 38.9% of GDP

Ministries will have to cut spending according to the following list:

  • Development Ministry by 347 million lei
  • Education Ministry by 154 million lei
  • Finance Ministry by 205 million lei
  • Health Ministry by 113 million lei
  • Environment Ministry by 108 million lei
  • Youth Ministry by 78 million lei
  • Communications Ministry by 43 million lei
  • Tourism Ministry by 30 million lei