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The IMF recommends fiscal restraint and tighter monetary policies, highlighting the importance and necessity of public investment, as well as the correlation between wage growth and productivity, shows the IMF's mission to Romania for a visit to the country. economic evaluation, according to Mediafax.
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Jaewoo Lee, head of the International Monetary Fund mission in Romania, said that if economic growth could remain in Romania at around 4%, the current account deficit would exceed 5% of GDP. "While people's incomes have risen rapidly to a level close to that of the advanced countries of the European Union, consumer-led economic growth has created macroeconomic imbalances." Inflationary pressures have returned to the surface, disproportionately affecting the real income of the poor and harming competitiveness, "said Jaewoo Lee at a press conference Friday.
IMF officials say the current and current account deficit has widened and public and private investment has declined in recent years, affecting growth prospects. Jaewoo Lee estimates that deficits have risen sharply compared to neighbors in the region, which is not normal in times of prosperity and economic growth. "There is a need to change government policies to reduce the possibility of a recession scenario, and a downward trend will affect people with low incomes and living standards more severely," said an IMF official.
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