"Reforms" was the word most often used at a three-day seminarorganised by the NBR (National Bank of Romania) and the RomanianBanking Association for economic journalists.
Facing the prospects of a third consecutive year of economicdecline in 2011, Romania is still working on adjusting its deficits- both the budget deficit and the current account deficit - but hasdone next to nothing to make its economy more "competitive".
As far as the National Bank is concerned, the ball is now in theGovernment's court, with the monetary policy now confined tomaintaining exchange rate stability and a working bankingsector.
Governor Mugur Isărescu analysed the economic situation in athree-hour presentation before an audience of around 30journalists, with the main identified problem being the state'sinability to pay its debts on time.
"Arrears are one reason for which there is recession and highinflation. Anyway, they are a major problem for Romania becausethey are not like a plague, but similar to a contagious disease. Itspreads around and affects the core of the market, which ismonetary, fiscal, discipline, payments on time. This generates achain of late payments that can be even worse than high deficits,"Isărescu said.
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