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© 2002 International Monetary Fund

September 2002

IMF Country Report No. 02/194

Romania: First and Second Reviews Under the Stand-By Arrangement, Request for Waivers, and Modification of Performance Criterion—Staff Report; Staff Statement; News Brief on the Executive Board Discussion; and Statement by the Executive Director for Romania

In the context of the first and second reviews under the Stand-By Arrangement, Request for Waivers, and Modification of Performance Criterion with Romania, the following documents have been released and are included in this package:

  • the staff report for the first and second reviews under the Stand-By Arrangement, Request for Waivers, and Modification of Performance Criterion, prepared by a staff team of the IMF, following discussions that ended on July 17, 2002 with the officials of Romania on economic developments and policies. Based on information available at the time of these discussions, the staff report was completed on August 13, 2002. The views expressed in the staff report are those of the staff team and do not necessarily reflect the views of the Executive Board of the IMF.

  • a staff statement of August 28, 2002 updating information on recent developments.

  • a News Brief summarizing the views of the Executive Board as expressed during its August 28, 2002 discussion of the staff report that completed the review.

  • a statement by the Executive Director for Romania.

The documents listed below have been or will be separately released:

  • Letter of Intent by the authorities of Romania*

  • Supplementary Memorandum on Economic and Financial Policies by the authorities of Romania*

  • Technical Memorandum of Understanding*

*May also be included in Staff Report.

The policy of publication of staff reports and other documents by the IMF allows for the deletion of market-sensitive information.

To assist the IMF in evaluating the publication policy, reader comments are invited and may be sent by e-mail to Publicationpolicy@imf.org.

Copies of this report are available to the public from

International Monetary Fund • Publication Services

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Price: $15.00 a copy

International Monetary Fund

Washington, D.C.

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INTERNATIONAL MONETARY FUND

ROMANIA

First and Second Reviews Under the Stand-By Arrangement, Request for Waivers, and Modification of Performance Criterion

Prepared by the European I and the Policy Development and Review Departments

(In consultation with other departments)

Approved by Michael Deppler and Liam P. Ebrill

August 13, 2002

Contents

  • I. Introduction

  • II. Recent Economic Developments and Performance Under the Program

  • III. Policy Discussions

    • A. Fiscal Policy

    • B. Wage Policy

    • C. Energy Sector Reforms

    • D. Monetary Policy and Banking Reform

    • E. Privatization

  • IV. Medium-Term Outlook, External Vulnerability, and Capacity to Repay the Fund

  • V. Program Monitoring

  • VI. Staff Appraisal

  • Text Boxes

  • 1. Request for Waivers

  • 2. Structural Conditionality

  • Text Tables

  • 1. Main Economic Indicators, 2001–03

  • 2. Export Performance of Romania and Neighboring Countries (2000–01)

  • 3. General Government Deficit and Quasi-Fiscal Deficit in the Energy Sector

  • Figures

  • 1. Consumer Price Index (CPI) and Net Wages, 2000–02

  • 2. Real Effective Exchange Rate, 1996–2002

  • 3. Exports, Imports, and Trade Balance, 1993–2002

  • 4. Reserves, Exchange Rates, and Bond Spreads, 2000–02

  • 5. Nominal Interest Rates, 2000–02

  • 6. T-Bill Yield Curve, 2001–02

  • 7. Net Wages, 12-Month Real Growth Rate, 2000–02

  • Tables

  • 1. Main Economic Indicators, 1999–2003

  • 2. Balance of Payments, 2000–02

  • 3. Summary of Consolidated General Government, 1999–2003

  • 4. Monetary Survey, 2000–02

  • 5. The Quasi-Fiscal Deficit in the Energy Sector, 2000–03

  • 6. Medium-Term Balance of Payments Outlook, 2000–06

  • 7. External Financing Requirements and Sources, 1999–2002

  • 8. Indicators of External Vulnerability, 1997–2002

  • 9. Indicators of Fund Credit, 2000–06

  • 10. Medium-Term Projections, 2000–06

  • 11. Schedule of Purchases Under the Stand-By Arrangement

  • Appendices

  • I. Fund Relations

  • II. World Bank Relations

  • III Statistical Issues

  • IV. Letter of Intent and Supplementary Memorandum on Economic and Financial Policies

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August 28, 2002

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News Brief No. 02/91

FOR IMMEDIATE RELEASE

August 28, 2002

International Monetary Fund

700 19th Street, NW

Washington, D. C. 20431 USA

EXTERNAL RELATIONS DEPARTMENT

Telephone 202-623-7100

Fax 202-623-6772

www.imf.org

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August 28, 2002