Romanian President Traian Basescu: IMF will not impose a VAT increase

Nobody fears the IMF, not even politicians or trade unions, Romania’s President Traian Basescu declared, on Wednesday in a radio talk show. He added that the temptation to have a counter position than the President made others take this stand.

Here are some of the most important declarations:

• EU conditions any loan to an IMF agreement

• Romania is in this situation because resources were wasted

• Romania will not be sanctioned by the EU on the budgetary deficit, but the EC will critique its previous waste of resources

• Everybody attacked my stand two days ago: the President has every right to address the Parliament in times of crisis and propose solutions

• Romania will take up a 2 year loan with a low interest rate but let’s not forget that some billions of euro are involved

• If we reject the idea of austerity, we will have to face serious consequences in two years’ time

• If we respect anti crisis measures, we will take up a lower loan

• No responsible expert in Romania will declare that the country can overcome the crisis without a loan

• No private society will receive money from the state from this loan, or budget money

• IMF money will cover the Central Bank reserves which will allow banks to use a part of their reserves at the central bank to finance the economy

• The loan needs to also cover the current account deficit and the state budget deficit

• let’s not undermine the capacity of Romanian negotiators to deal with the IMF

• I do not think that the IMF will request a VAT increase or compel Romania to give up its fixed tax. There are other solutions.