At the beginning of January, the leu reached the lowest rate in history in relation to the EUR. The current level of RON 4.6764 exceeds the previous record of RON 4.6695, set on 21 June 2018. This negative record will inevitably generate a wave of price rises on all products from the European Union and on payments and rents in euros for Romanians. Romania recorded the highest levels of current account deficit and budget deficit among the EU’s Member States in 2018. Moreover, the fiscal-budgetary measures at the end of 2018 and the absence of a draft budget for 2019 contributed to the intensification of risk perceptions on the development of the budget deficit in 2019.
When Romania joined the European Union, our country committed to join the single euro currency within a timeframe which depended, of course, on the degree of economic integration with the euro area. We are currently witnessing unwise fiscal measures which create more pronounced economic instability and a concerning depreciation of the leu. Under these conditions, inflation will continue to rise, imports will become more expensive and Romanian citizens’ quality of life will decrease.
What are the Commission’s recommendations for the Romanian authorities regarding Romania’s accession to the euro area?