EC: Fiscal adjustment to continue in Romania also in 2015
The Romanian authorities intend to continue fiscal adjustment in 2015, in order to reach Romania's medium-term budgetary objective of a structural deficit of 1 percent of GDP, while also accommodating expected further increases in co-financing of projects supported by the EU, reads a European Commission release published at the end of the visit to Bucharest of a team of IMF and EC experts.
A subsequent delay in the implementation of excise taxes on fuel products will be compensated with freezes on the expenditure side, reads the cited document.
The European Commission also notes that progress on reducing state-owned enterprise arrears has stalled, but stresses that corrective actions are being launched, including budgetary transfers and restructuring measures.
An action plan to sustainably lower arrears over the medium term will be also defined, the release shows further.
As regards the completion of the IPOs for the three state-owned enterprises Hidroelectrica, Electrica and the Oltenia Energy Complex, the Commission considers that, building also on the success of the Romgaz IPO, their progress toward completion remains broadly on schedule.
Regulatory reforms in the energy and transport sectors are set to continue, as well as the deregulation of the gas and electricity prices, in line with the earlier agreed roadmaps, the Commission further notes.
According to the schedules agreed upon by the Government and the IMF in 2012, the electricity market was fully liberalized on January 1, 2014 for industrial consumers, whereas for households the liberalization process will be completed on December 31, 2017.
For gas, the initial timetable provided the market′s complete liberalization for industrial consumers by December 31, 2014 but the deadline has been meanwhile moved forward to July 1, 2014. For households, the prices will be fully liberalized on December 31, 2018.
Teams from the International Monetary Fund and the European Commission visited Bucharest between January 21-February 4 for talks on the combined first and second reviews under the IMF Stand-By Agreement (SBA) and on the status of Romania′s precautionary balance of payments program with the European Union, the newswire ActMedia reported.