And out of this, loans taken by foreign-based banks operating in Romania from their parent undertakings abroad account for the largest share. We have started to address this issue by taking measures aimed at discouraging foreign currency-denominated loans. If that risk materialised and parent banks diminished their flows to Romania, the effect would be rather beneficial as it would remove the base for an unsustainable expansion of foreign currency-denominated credit which has been a headache for so many years. Therefore, I do not consider these arguments that solid to place Romania in a group of countries with high likelihood of witnessing hard landing. Do you think, therefore, that high economic growth in Romania will go on? I believe that Romania will see further economic growth in the coming years. A growth much closer to the potential which our experts had estimated at around 6 percent annually. It is true that, with weakening economic activity worldwide, especially in the EU which is our main trade partner, economic growth might be a bit slower than 6 percent. No doubt that economic growth will be affected by several factors next year, placing it over or below 6 percent: the oil price, the farming year, heightened efforts to develop the infrastructure and also to create conditions to boost labour productivity, the level of foreign investments, and so on. In any case, a 6 percent annual economic growth in the present context is a remarkable achievement.
Mugur Isărescu: Hard landing unlikely for Romania Interview with Dr Mugur Isărescu, Governor of the National Bank of Romania, by Mediafax news agency, Bucharest, 8 September 2008. *  *  *  Mr. Governor, foreign analysts have placed Romania along with four other states – Lithuania, Latvia, Estonia and Bulgaria – in a group of countries heading to a hard landing. In fact the economies of Estonia and Latvia have contracted sharply, with growth plunging from levels of around 10 percent into negative territory; inflation has reached two-digit levels and the external deficit exceeded 15 percent of gross domestic product. Is it possible for Romania to witness similar negative growth dynamics? Is it fair to include Romania in that group? Reading what those foreign analysts said, I have hardly found a solid rationale that would justify Romania's being placed within the hard-landing risk zone. On the contrary. Turning now to comments, I will underline that there are some similarities among the countries in this group: GDP per capita is below the EU average, they all have registered high growth rates in the catching-up process. However, there are also fundamental differences, among which the most important in my view is the monetary policy mechanism. Three of the four countries mentioned in the group have currency boards in place, and the fourth, i.e. Latvia, has a mechanism close to a currency board. Of course, currency board has its clear benefits.