The International Monetary Fund criticized Romania on Friday for plans to raise pensions sharply, saying the move is likely to stoke inflationary pressures and give a new boost to the current account deficit, Reuters reported.
The Romanian parliament cleared a draft law on Thursday nearly doubling state pensions in the next two years. The government also plans to lower social security contributions by 6 percentage points in 2008. “While we understand pensions are low, fiscal decisions need to recognize there is a budget constraint and should not be taken in isolation of the macroeconomic environment,” the IMF's senior regional representative Juan Jose Fernandez-Ansola told Reuters in written comments. (mediafax.ro)