Government presents budget draft

The Finance Ministry has presented the budget draft and the main economic indicators. This draft may be modified following negotiations with the IMF. There are differences between the two parties’ stances regarding the calculation of some macro-economic indicators, such as economic growth, VAT and budgetary deficit.

This year’s budget draft stipulates that expenditures for pensions, welfare, transports, infrastructure, defence and industry, as well as investments, will increase, Finance minister Mihai Tanasescu announced on Tuesday. Premier Adrian Nastase stated that a correct balance of payrolls and investments is also necessary.

“Now, when we see the clashes from the Balkans, the political unrest from the East, the evolutions from the Republic of Moldova, which cannot be completely forecast, wise governing is essential for next years’ evolution,” Nastase specified.

GDP is estimated to stand at 1,083,900.0 billion lei this year, against a predicted exchange rate of 28,500 lei per dollar.

Pension and welfare expenditures will increase from 9.7% of GDP last year to 10.6% this year, while expenses for supporting railway transport, house building and public utilities will increase to 4.8% of GDP, up 0.2% against last year.

Education will be granted 4% of GDP, healthcare will receive 3.7% of GDP, while agriculture will get 1% of GDP. The industry, including expenses for Cernavoda Unit II finalisation works, subsidies for mining and pits closing, will be allotted 0.9% of GDP, 0.1% higher than in 2000.

The Public Order Ministry will receive 1.9%, while the Defence Ministry will be allotted 1.5% of GDP. The Finance minister stated that the Defence Ministry would be allotted 1 billion dollars this year, also supplied by foreign sources.

Personnel expenses will decrease from 5.5% last year to 5.3% this year, material expenditures will go down to 6.8% this year from 7% last year, while investment expenses will increase to 3.4%, 0.6% higher than last year.