BUCHAREST: Romania's prime minister rejected on Thursday a European Commission forecast that the country's fiscal deficit would swell to 3.5 percent of economic output next year, saying his government would meet its targets.
Victor Ponta has rolled out proposals for sweeping tax cuts between June and 2019, including a sharp reduction in value added tax for food products, in an effort to fight tax evasion and spur economic growth and private consumption.
But the proposals have been questioned by Romania's fiscal watchdog as well as the International Monetary Fund and the Commission, which have warned the government not to endanger recent years of deficit cuts.
"That was a wrong prediction because it was based on uneconomic calculations," Ponta told foreign media.
"I am sure that as we have respected all targets until now, we will respect it next year." Romania recorded a deficit of 1.5 percent of GDP last year, under European accounting standards, and has forecast a similar figure for 2015. It recently told Brussels the figure would come in at up to 1.2 percent from 2016 through to 2018.
Ponta said preliminary data showed the budget ran a surplus of 0.7 percent of gross domestic product between January and April, and that 2015 economic growth would be around 3 percent.
He also said Romania planned to build a 850-km (528-mile) gas pipeline from the Black Sea, through Romania and up to Hungary and beyond. He added that half of the 1 billion euros needed for the project could come from the European Union.
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