Old warnings for new government

The IMF has requested that Calin Popescu Tariceanu, the new prime minister, take steps against the major debtors to the state budget, the same thing it has been asking of the Romanian authorities for some years. Yesterday, Tariceanu held an informative meeting with IMF resident representative in Bucharest Graeme Justice. The IMF expects commitments on the adoption of harsh legislation to punish financial indiscipline and tax evasion to be honoured. The government press office said the IMF official had explicitly mentioned the RAFO Onesti case, in which the decision taken by the former cabinet to transfer all of the state’s receivables to the State Asset Resolution Authority (AVAS) contradicted the commitments in the Stand-by Arrangement signed early in July 2004. A press release issued after the talks between Tariceanu and Justice shows that the IMF official mentioned a number of “slippages” from important provisions of the Economic Policies Memorandum seen during the term of the last government, such as the pay rises awarded before the elections which could affect the 9% inflation target, the unrealistic budgetary policies that led to the accumulation of arrears in the economy and energy sector policies. ZF