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Romania Parliament Approves 2012 Budget With 1.9% of GDP Gap

17. December, 2011

The Romanian Parliament approved the government’s 2012 budget, which narrows the fiscal gap to 1.9 percent of GDP in 2012 from a target of 4.4 percent in 2011, in order to meet pledges to the EU and the IMF.
The budget outlines public-spending cuts through wage and pension freezes, through cutting the number of its public jobs to 1.1 million by the end of next year from 1.4 million in 2010 and by restructuring money-losing state companies before a general election late next year.
The budget is based on economic growth of 2.1 percent, less than the previous forecast of 3.5 percent, and inflation at 3.5 percent at the end of next year. The government expects the economy to grow 1.5 percent to 2 percent this year.
According to Mr. Gherghina, the Deputy Finance Minister, Romania plans to borrow about 13 bil. Euro in 2012 and 2.4 bil. Euro to finance its budget deficit and pay for maturing debt.