IMF, EU mission in Romania discusses budget

(BUCHAREST) - A mission from the International Monetary Fund and the European Union is expected in Romania on Monday to discuss the draft 2010 budget, crucial to new loan disbursements, IMF representative Tonny Lybeck said.

"During December 14 to 16, a small technical team from the IMF and the European Commission (EC) will visit Bucharest (...) and continue the technical work on the 2010 budget with experts of the Ministry of Public Finance," Lybeck said in a press release.

"The review mission could return in January, once a new cabinet has been formed and has elaborated its program," he added.

In November, the IMF, the EU and the World Bank had decided to delay the next instalments of their 20-billion-euro package to Romania, dealing a new blow to the heavily recession-hit economy.

Romania was expecting to draw 1.5 billion euros (2.24 billion dollars) from the IMF and 1.0 billion euros (1.5 billion dollars) from the EU of its 20-billion-euro loan in December. The loan was agreed earlier this year as Romania's finances plunged into a steep economic crisis.

But the political crisis in this ex-communist European Union member has dragged on since the fall, early October, of the centre-right government, delaying several reforms expected by financial institutions.

One of the principal conditions Romania must observe in order to get the next instalments is adoption of a draft 2010 budget based on a deficit of 5.9-percent of output.

This however cannot be done until a new government is sworn in.