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IMF official in Romania criticized for attending a party denies any wrongdoing

By Associated Press, Published: February 5


BUCHAREST, Romania — The head of the International Monetary Fund’s mission in Romania on Sunday criticized politicians and media for accusing him of misconduct for having attended a party held by government officials at a time of harsh austerity measures.

A video of the party that Jeffrey Franks attended last week at a restaurant in a Romanian mountain resort has been shown by TV stations nationwide.






( Vadim Ghirda / Associated Press ) - International Monetary Fund envoy to Romania Jeffrey Franks gestures during a news conference in Bucharest, Romania, Sunday, Feb. 5, 2012.
On Sunday, the American held a news conference in Bucharest to discuss Romania’s economic problems and the austerity measures it has imposed to receive an IMF-led loan.

When asked about critics who have said Franks should not have attended the party, which included drinking and dancing, Franks denied misconduct.

Franks said he was invited “to a lunch that was sponsored by the Ministry of Finance and the National Bank of Romania, which included traditional Romanian food and music in a well-known restaurant.

“I’m afraid to say ... I think that they picked the wrong person to accuse of misconduct here,” he said. I’m a deeply religious person. I’m a Mormon. In my religion, we don’t drink alcohol, we don’t smoke ... and we don’t engage in any behavior that calls into question our moral character. My conscience is clear.”

But opposition politicians and journalists have said that Franks should not have been seen socializing and enjoying himself with government officials, especially because the IMF conditioned its 2009 loan on austerity measures which led to a wave of recent street protests in January.

In May, Franks hit the headlines after he was seen wearing shoes with a hole to visit President Traian Basescu, eclipsing his remarks about more serious issues of public spending, layoffs or inflation in Romania.

At Sunday’s news conference, Franks urged the government to continue reforms, especially in the health and energy sectors, adding however, that he understood Romanians are unhappy with austerity cuts. Recent protests all around Romania were against higher taxes and slashed wages in the public sector.

Franks said that Romania and the IMF had reached an agreement to unlock about €505 million ($664 million) in funds from its standby loan. In 2009, Romania signed up for a €20 billion ($26 billion) loan with the IMF, European Union and World Bank to help pay salaries and pensions as the economy shrank by more than 7 percent.

Franks said the IMF had lowered its economic growth forecast for Romania this year to between 1.5 percent to 2 percent from a previous outlook of between 1.8 percent and 2.3 percent because of a drop in exports to Western Europe, the country’s major trading partner. The economy grew by 2.5 percent in 2011, partly because of a bumper harvest.

Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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