Bucharest, May 10, 2010. From April 27 – May 9, 2010, a World Bank team headed by Swati Ghosh, a lead economist in Europe and Central Asia region, visited Romania, together with the IMF and the European Commission missions, to discuss progress and future steps regarding the medium term structural measures to support the Romanian government’s reform agenda. The visit is part of the support provided by the Bank as part of the multilateral package for Romania’s reform program. The Bank team had meetings with the Romanian authorities and stakeholders, and discussed the economic reform program supported by the World Bank in the context of the second Development Policy Loan (DPL2) in three key areas: improving public sector efficiency, protecting the poor and vulnerable, and strengthening the way the financial sector functions.
The reform agenda supported by the DPL is progressing well. The new Pension Law is already under debate in the Parliament, while the Fiscal Responsibility Law has been promulgated. Deep reforms are underway in health and in education. The implementation of a new unitary pay system has advanced and a representative sample of public sector jobs has already been evaluated under the supervision of the bi-partite Pay Commission. This will provide the basis for the drafting of the implementing legislation of the Unitary Pay Law, which is expected to be submitted to Parliament by September. The Bank is also working with the Ministry of Labor to ensure that the needed social assistance programs for the poor and vulnerable are consolidated, rationalized, well-targeted and have the appropriate coverage, while at the same time public resources are not wasted and the existing leakages from the social protection programs are reduced.
Significant progress has been made and the World Bank team commends the efforts of the Romanian Government towards achieving the agreed reform agenda.
The Development Policy Loans (DPL) program, amounting Euro 1 billion, focuses on public financial management, the social sectors and the financial sector. The first Development Policy Loan, totaling Euro 300 million was approved by the Board of the World Bank on July 16, 2009, signed on September 1, 2009, and disbursed on October 20, 2009. The DPL reform agenda supports policy measures and structural reforms to achieve fiscal sustainability in Romania and uphold the recovery process, and closely complements programs supported by the IMF and the EU.