The resumption of economic growth this year will create theconditions for an accelerated fiscal consolidation, according tothe updated convergence programme, which features the strategy toexit the excessive deficit procedure and to reduce the budgetdeficit to under 3% of the GDP by 2012.
"In the long run, the Government intends to continue efforts forfiscal consolidation in order to reach a balanced budget over theduration of the economic cycle, which would entail a sufficientlyhigh safety margin in order for deficit not to exceed 3% of GDP incase of a potential renewed slowdown of the economic growth," readsthe convergence programme for 2009-2012.
The Government is firm in its commitment to continue until 2013the austerity measures initiated in 2009. The major challenge at atime when the Romanian economy is in recession is the applicationof urgent austerity measures, including cuts on personnel spendingby means of pay freezes and by cutting state benefits.
The firm targets committed to by the Government are set toresult in a reduction of the budget deficit by 1.7% of the GDP in2010, 1.9% in 2011, and 1.4% in 2012, which means an overall fivepercent cut between 2009 and 2012.
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