ECONOMICS - In Brief

According to Hans Timmer, a main World Bank economist, the vulnerabilities of Romanian economy are greater than those of other developing countries. One reason for it, he argued, is the high current account deficit.

The WB official developed upon it during the release of the "2008 Global Economic Prospects" and he related it to the US financial crisis. Timmer pointed that the current account deficit might deteriorate even more. He argued the increase of the current account deficit had effects right after the crisis had burst out in the US. The exchange rate underwent a powerful increase in Romania, whereas national currency appreciated in other states Still he commented it was no reason to panic, but he described the situation as unsustainable.

The WB economist argued Romania's fiscal policy should grow more cautious. As for other flaws, he mentioned the increase of consume expenses and the approach to the finance for the current account deficit.

The WB report also analyzes the way technology is spreading at international level and the impact of it on developing countries. He warned 50 points was the average for this group of states in terms of technological development, whereas Romania got only 45. (...) (F.B.)

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