IMF board approves release of EUR 505 mln to Romania

The International Monetary Fund (IMF) expert mission will recommend its board approve the next EUR 505 million tranche from the stand-by accord, after it judged Romania was meeting its targets under the bailout agreement and had agreed the next steps with the authorities, said the IMF delegation chief, Jeffrey Franks.

March 2012 - From the Print Edition

“The experts have agreed. All quantitative targets were met and we reached an agreement on future policy. We expect a board meeting in late March,” said Franks. In March of last year, the Bucharest authorities decided to extend the agreement with the IMF concluded in 2009 to secure a EUR 3.5 billion bailout.
The agreement with IMF includes EUR 1.4 billion of preventive support from the European Union and a EUR 400 million loan from the World Bank, money that was not part of the previous accord. The World Bank granted the loan in December last year.
The IMF approved in December the third assessment report of the implementation of the economic and fiscal program agreed with Romania and made available a new sum, equivalent to 430 million Special Drawing Rights (EUR 507 million). The total amount available to Romania thus rose to 1.35 billion Special Drawing Rights (the equivalent of EUR 1.6 billion).
Mugur Isarescu, the BNR governor, said Romania should not conclude a new agreement with the IMF after the completion of the current one, scheduled for 2013, because it would not give a good signal regarding the markets, and the EU could plug the gap.
The BNR official said that new anchors can and should be agreements at EU level, like the Fiscal Stability Pact.