December 16 (SeeNews) - Romania's finance ministry said on Friday it has contracted a 500 million euro ($522.5 million) loan from the World Bank to improve public finance and boost economic growth.
The loan should be repaid in a single instalment in 2036, the finance ministry said in a press release.
"Approval of this loan is evidence of the World Bank's recognition of Romania's macroeconomic stability, of the recent progress in implementing structural reforms and also of the measures we took to alleviate poverty and prevent social exclusion," finance minister Anca Dragu said.
After the approval of the loan by the World Bank's board of executive directors, Romania and the bank will signing of the loan agreement and the parliament will have to ratify it. The closing date is December 31, 2017, the finance ministry said.
The World Bank said in November that Romania's economy will grow by 5.1% growth in 2016 and by 3.8% in 2017. "Growth is expected to remain solid in 2017 as additional fiscal relaxation measures will be implemented, including a further VAT cut to 19%, the elimination of the special construction tax and a reduction of the excise rate for fuel,” the World Bank’s latest Europe and Central Asia reads.
The financial institution‘s previous estimates released in June predicted a 4% growth of Romania's economy in 2016 and 3.7% in 2017.
($=0.9569 euro)