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On December 2, Romanian President Traian Băsescu informed the International Monetary Fund (IMF) that he would refuse to endorse a 7-cent per litre tax increase on fuel demanded by the international body.
According to Băsescu, the tax hike, which is one of the conditions for an IMF loan to fund a standby arrangement in 2013-2015 would push up consumer prices and have an "explosive" and negative impact on the country. Romania has already benefited from two such loans in the last five years: in 2009 and in 2011.
This will pave the way for “an inevitable end to our agreement with the IMF,” argues Jurnalul Naţional. The daily, which is opposed to the president, fears ”an immediate decline in the exchange rate and a rise in the cost of external borrowing. The president has made the country a greater risk.”
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