Dominique Strauss-Kahn, IMF Managing Director answers questions posed by HotNews.ro readers before his visit to Romania. It is for the first time when the IMF chief interacts with readers of a publication in Romania. Strauss-Kahn talked about the origins of the economic crisis, the measures Romanian took or about the speculations on weak currencies.

1. You previously said that the probability of a future crisis is high. What kind of crisis will it be? Here, we talk about a debt crisis or one regarding inflation and unemployment. How can a state protect itself from a future crisis? (By I.B.)

We all know that the global financial crisis had its roots in excess risk taking and leverage in the financial sector. It is very important to address this problem and go ahead with reforms to make the financial sector safer. Another aspect of the crisis has been the sharply rising public debt among advanced economies. If nothing is done to rein in debt, the next crisis could well be fiscal. What countries need to do now is to communicate fiscal consolidation strategies, and to start implementing them.

This global financial crisis has shown that countries with sufficient fiscal cushions were able to use that room effectively to stimulate and counteract the negative impact of the crisis on economic growth. So it is key for countries to create this fiscal space when they can in preparation for severe economic downturns.

Particularly in Central and Eastern Europe, countries have weathered the crisis very differently. Many—like Romania—suffered severe downturns. We have seen that what makes a difference in terms of a country’s response to the crisis has been the quality of its economic policies and institutions. In the case of Romania, the government very wisely sought the support of the international community before the full e