State to borrow up to 4.3bn euros

The state and its entities will be able to contract foreign credits amounting to a maximum 4.3 billion-euro limit this year, that is two billions more than in 2005, according to the foreign public debt ceiling set by the Ministry of Finance. The initial ceiling for last year had been set at 3.5 billion euros. Out of this amount, 600 million euros were to be raised through an eurobond issue that the ministry later dropped due to low needs to finance budget deficit, so the ceiling stayed at 2.9 billion euros. By the end of 2005, Romania had contracted a foreign public debt worth 23.4 billion euros, which accounted for 28.9% of the preliminary GDP standing at 78 billion euros. According to World Bank methodology, foreign public debt should not exceed 50% of GDP. Forecasts say the GDP is to reach almost 91 billion euros in 2006, with the currency exchange rate being estimated at 3.55 RON/EUR. ZF