The current account of Romania’s balance of payments posted 1,386 million-euro deficit in seven months, up 30.3% from the year-ago period.
According to data released by the National Bank of Romania (NBR), the current transfers posted a positive balance worth 873 million euros, 5 million euros more than the surplus logged in the first seven months of last year.
As for the international trade, it saw the most rapid increase of the negative balance, amounting to 1.83 billion euros, up 17.2% from the year-ago period.
Moreover, services reported a deficit worth 10 million euros, although there had been a surplus of 5 million euros at the end of July 2002.
Medium and long-term foreign debt went up 2.9% as compared with December 2002 and amounted to 15.04 billion euros at the end of July.
The public and publicly-guaranteed foreign debt totalled 9.72 billion euros, whereas the private foreign debt has dropped 2.2% since December 2002, down to 5.31 billion euros. The foreign debt service went up to 1.63 billion euros at the end of July, out of which 424 million euros accounted for the public debt, 544 million euros – publicly-guaranteed debt and 669 million euros – private debt. According to the IMF agreement, the upper limit for the current account deficit should not exceed 4.5% of the Gross Domestic Product (GDP) by yearend.
However, following the latest agreement revision in July, the IMF officials and the Romanian authorities showed the deficit could climb to 5% of GDP. The IMF estimates the current account deficit will amount to 6% of GDP next year, if the growth pace maintains, with the fiscal deficit cut the only safe way to control it. According to IMF chief negotiator Neven Mates, the Fund is mainly concerned with losses in the energy sector, the non-governmental lending increase and the wage raises, which have outpaced the economic productivity. miruna.lebedencu@zf.ro