Romanian central bank governor: 30,000 more unemployed would not be a problem, but the figure may be bigger

A rise of the number of Romanian unemployed by 30,000, or 0,5% of the Romanian work force, would not be a major problem in terms of unemployment at national level, but the figure may rise beyond current estimations, Romanian Central Bank (BNR) governor Mugur Isarescu said on Thursday night.

He said at a Gala celebrating ten years since major business newspaper Ziarul Financiar was launched that the figures would be a problem for everybody who is left without a job. But a 30,000 rise in the number of unemployed people would only mean 0,5% of the total workforce which, combined with the current unemployment rate of 3-4% at national level, would hardly make it a macro-level problem, he said, quoted by news agency Newsin.

But he warned that this would not erase the risks of unemployment as the numbers may be higher than those currently expected.

Speaking of the Romanian GDP, Isarescu said the level forecast for 2008, of 140 billion euro, puts the level of GDP per capita at 6,500 euro. The current buget is higher than the whole GDP for the past ten years, he said.

He also said the decision of Standard&Poor’s and Fitch to downgrade Romania was unfounded and explained that for the moment he had a feeling of deja vu as the rating agencies have treated Romania with lot of caution years ago, when the talk was about halting foreign payments.

Isarescu said the S&P report did not mention the level of Romania’s foreign debt and its foreign currency reserves.

On the other hand, he said that other countries who received better treatment from rating agencies have been turning to austerity measures given the difficult international situation.