IMF’s main demand is to give up state aid, Economy Minister says

In the talks with the government, the IMF delegation has as “primary demand”, i.e. giving up state aid, said on Thursday the Minister of Economy and Tourism, Mihai Tudose, adding that another big problem is the cancelling of arrears for large state companies.

Minister of Economy and Tourism, Mihai Tudose, while at Buzau for a meeting with businessmen in the county, was asked by journalists about the IMF demands in negotiations with the government; he replied that he can not disclose details as long as talks are not completed.

“We are still in negotiations with the IMF and we cannot talk during the game. However, one of the main demands was for the state to give up aid, to end the lack of will to confirm some state companies’ debts. When a public company does not pay debts to another state firm which in turn does not pay another state company, this circuit is also a state aid because the state is an actor who feels good in this situation and may compete at some time with a private company without fair play. There are also problems with deleting arrears and with the governance, with the management of large companies,” said the Minister of Economy.

Finance Minister Darius Vâlcov said on Wednesday that the government will have the most important meeting with the IMF on Friday, one to be attended by all ministers, to “try to reach an agreement” with the Fund’s experts. Then will it be known “if there will be or not an agreement further on”.

Also Wednesday, the BNR governor said the central bank is prepared for the eventuality that Romania will stop the agreement with the IMF, while saying that the negotiations were going well and that he will not make any more comments before the IMF press conference, scheduled for Monday.

The IMF started is on a visit to Romania during January 27 to February 10, for consultation and the third review of the stand-by arrangement with Romania, agreement which would conclude in September this year.

Romania has an ongoing EUR 2 billion agreement with the IMF, due in September. The aim is to protect the domestic economy from potential shocks on the financial markets and to help reduce financing costs.