Romania has won a 20 billion euro loan from the International Monetary Fund, to help it tackle the growing financial crisis. The package is expected to provide stability and ease pressure on the the leu, which is trading at near-record lows against the euro.
Romania is the third European Union nation to be bailed out after Hungary and Latvia, as the global turmoil devastates weaker economies built on cheap credit. The loan is a lifeline for Prime Minister Emil Boc and his coalition of former political foes. He took power three months ago inheriting an overheating economy and an electorate wary of deep budget cuts. However, Bucharest has a patchy record with the IMF, reneging on several crucial reforms. Romania has gone from being an attractive destination for foreign investment with fast rates of growth, to an economy plagued by ballooning debt and gloomy prospects. The government now stands accused of making campaign spending promises it can no longer afford.