Romania’s power struggle between the country’s ruling coalition and suspended President Traian Basescu and the impeachment vote later this month have increased market concerns about the country’s fiscal tightening and are “credit negative,” Moody’s Investors Service said.
“Political uncertainty may persist until, and even beyond, national elections scheduled in the last quarter of 2012 and will likely hinder structural reforms in Romania’s vast state enterprise sector,” Moody’s analysts Atsi Sheth and Andrew Schneider wrote in the rating company’s Weekly Credit Outlook published today.
International criticism of the political process “has added to market concerns and, if it not adequately addressed, it could impair relations between Romania and the EU, which has been an important source of institutional and financial support for Romania,” the two analysts said.
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