- Category: Economy
- Published on Monday, 30 March 2015 12:38
Prime Minister Victor Ponta has appointed a new finance minister to replace Darius Valcov, who recently resigned amid a graft probe.
President Klaus Iohannis on Monday is to approve the nomination of Eugen Teodorovici for the post of Finance Minister.
Teodorovici, 43, is an MP who has been Minister of European Funds since 2012 when Ponta set up the ministry.
He is to become the sixth finance minister since Ponta took office in May 2012. The premier has jokingly referred to the position as a "kamikaze" role.
Teodorovici is facing difficult talks in April with the International Monetary Fund and the European Commission, during which he will seek backing for Romania's plans to cut taxes in order to boost disposable income and get people spending more.
VAT is to be cut from 24 to 20 per cent, while taxes on meat, fish, vegetables and fruit are to be reduced to nine per cent from next January. The changes are part of the new fiscal code, which is now undergoing public debate.
On Friday, the IMF said the planned tax cuts threatened to undermine five years of fiscal consolidation and urged the cabinet to reconsider their size and timing.
Valcov stepped down early this month after prosecutors opened an investigation into him over alleged corruption during his previous role as the mayor of Slatina.
Prosecutors accused Valcov of having favoured a firm for a public works contract in exchange for about two million euro. They subsequently accused him of unlawful gains after they discovered cash, gold bars and 100 paintings, some by Pablo Picasso and French Impressionists, in his safe.
Parliament voted last week to allow prosecutors to arrest Valcov.
Romania has drawn repeated criticism from the European Commission for its failure to tackle the country's corruption problem.
But in recent years, the number of high-ranking officials convicted of graft has increased significantly. In 2014 alone, among those sentenced for graft and graft-related offences were 24 mayors, five parliamentarians, two former ministers and one ex-prime minister.
Bucharest is hoping that the signs of progress noted by the European Commission will assist Romania's bid to join the EU's borderless Schengen zone.