Eugen Rădulescu, advisor to the governor of BNR, warned that the breaking of the governing coalition by PSD, at a time of economic vulnerability, could lead Romania into economic chaos with long-term effects. Although the price of oil has dropped below 100 dollars, the political instability in Bucharest will lead to higher credit costs.
Rădulescu criticizes the Ciolacu government for the irresponsibility with which it has increased the deficit to alarming levels. Continuing tough reforms, including restructuring the budget apparatus, is essential to achieve the deficit target of 6.2%. Additionally, breaking the coalition jeopardizes accessing 10 billion euros from PNRR, essential funds for the Romanian economy. Rădulescu concludes that the moment chosen by PSD to leave the majority is disastrous, wasting recent economic progress.
"I don't understand politics. I don't want to speculate on the calculations that PSD might have made when it decided to leave the governmental majority. And in fact, I am not interested. But:
1. The international situation remains on a knife's edge, even though the price of oil has temporarily dropped below 100 dollars per barrel. This situation alone is likely to strain financial markets, which translates into higher credit costs, especially for the most vulnerable countries.
2. The country's budget deficit is still huge, even though it has decreased from the level of 9.3% of GDP, where it was brought by the extreme irresponsibility of the Ciolacu government. Continuing reforms is imperative, even if they lead to staff reductions in the public sector and the restructuring of loss-making state enterprises.
3. We have only a few months left for the Romanian state to adopt the measures that will unlock the 10 billion euros remaining from PNRR. Money for which our country should not have to pay ANYTHING.
I have no idea what party calculations PSD might have made. What I know is that they could hardly have found a more unfortunate moment to risk chaos of proportions in the country's economy. '' , wrote the advisor to the governor of BNR in an article on the platform Republica.ro.
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