IMF: Better, but not enough. See you before Easter

Salary payments made by the state-run companies early in the year seem to have exceeded a level that can be economically justified; the poor financial discipline makes state-run loss-generating companies keep using the insufficient country resources; the need to speed up the privatisation programme.
These are the big problems found by the International Monetary Fund (IMF) delegation that was in Romania last week for the third evaluation of the stand-by agreement.
The Government pledged by a new supplementary economic and financial policy memorandum – the third from the signing of the agreement, to take a series of steps agreed upon with the IMF representatives in order to address some of the issues in question. Depending on the actual enforcement of these measures, the Board of the Fund could debate the third assessment of Romania’s performance as early as the second half of April, to give the Romanian authorities time to comply.
At any rate, the new supplementary memorandum stipulates extending the stand-by agreement by four and a half months, that is until mid September 2003, unless further extensions are needed.
The new commitments taken by the authorities are divided into three categories: fiscal policy, energy sector reform and privatisation.
The fiscal policy commitments are: allocating additional funds for heating aids and emergency aids; allocating supplementary budgetary funds to add up to the incomes of those to be laid off from a series of loss-making state-run companies in order to lessen the social impact of the restructuring process and prepare those companies for privatisation. They also include allocation of additional governmental guarantees in view of completing investments in Cernavoda Unit 2, as well as for railroad rehabilitation; speeding up fiscal administration reform.
Commitments for the energy sector reform include: continuing the privatisation preparations for the electrical power and natural gas distribution, as well as for the oil sector; maintaining 2003’s electrical power and thermal power prices in USD at the 2002 level.
The privatisation commitments are speeding up privatisation of companies employing more than 1,000 people; moving on with BCR’s privatisation, to include EBRD and IFC.