EU funds to support Romania's economic growth of 2.5 percent in 2013, says President Basescu

EU funds to support Romania’s economic growth of 2.5 percent in 2013, says President Basescu

Newsroom 31/10/2012 | 14:03

Romanian President Traian Basescu said during an official meeting with the President of the European Parliament, Martin Schulz, the domestic economy may grow next year by 2.5 percent of GDP, based on the absorption of EU funds.

President Martin Schulz also spoke on Wednesday in the Parliament, as part of his first official visit in Romania.

For this year, the government revised down the economic output to 1 percent of GDP, while the EBRD put it at 0.5 percent in its latest estimate. Economists at BCR, the largest bank in Romania, said the economy will grow by 0.7 percent due to a poor agricultural harvest and the Euro zone woes.

“I have to tell you that during my talks with President Schulz, Romania was appreciated as one of the countries with a stabilized macroeconomic situation. I informed the president this was due to the huge sacrifices made by the Romanian people, but these are sacrifices that will be rewarded because Romania has better economic growth conditions. And the key to economic growth on the macroeconomic stabilization is the absorption of EU funds,” said President Basescu quoted by Mediafax newswire.

Romania pinned its economic growth expectations on the EU funds, but the management flaws in three programs forced the EU to take drastic measures. The European Commission last week pre-suspended the largest part of the Transport, Regional and Economic competitiveness growth programs. Romania should solve issues on public acquisitions, financial management and fraud prevention by year end, to unlock payments.

The Commission previously pre-suspended the Human Resources Development program (POSDRU). Payments on the Transport and Competitiveness programs were blocked in July.

The absorption rate of structural and cohesion funds reached 9.7 percent by September. Payments from the EC stood at EUR 1.8 billion in the same period, according to data from the Ministry of European Affairs.