President Traian Băsescu yesterday confirmed what Ziarul Financiar had written: a new loan agreement with the IMF. Despite promises from the Government and the NBR that there was enough money to repay the huge 20 billion euro loan sealed in March 2009, the already existing debt cannot be repaid without taking on more debt.

Romania's President Traian Băsescu yesterday announced at the beginning of a discussion with Jeffrey Franks, head of the IMF mission in Romania that the continuation of the arrangement with the IMF would be discussed in October.

The type of the new agreement is yet unknown, i.e. whether we continue to take money from the Fund or it is just a precautionary agreement, an agreement that does not entail drawing funds but just a guarantee that the state can borrow if needed. Anyway, this means the Romanian state is getting into a spiral of repaying debt by taking on more debt, which is the easiest way for a state to become reliant on foreign debt and no longer find its way towards development. The situation is much worse than presented by the Government and the National Bank in March 2009, when they announced a 20 billion-euro loan overnight, the biggest in the entire history of Romania and half of the country's budget and reveals the failure of the finance and foreign currency reserve management.

"This time you're in Romania only to celebrate the anniversary of the National Bank of Romania. I am glad to see you again. I am looking forward to the visit in October, when we won't have a celebration but an assessment of the difficulties we're having," Băsescu said at the beginning of the meeting with Jeffrey Franks.

President Traian Băsescu yesterday confirmed what Ziarul Financiar had written: a new loan agreement with the IMF. Despite promises from the Government and the NBR that there was enough money to repay the