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In the 1980s, severe austerity measures were imposed in the Socialist Republic of Romania by President Nicolae Ceaușescu in order to pay off the external debt incurred by the state in the 1970s. Beginning in 1981, the austerity led to economic stagnation that continued all throughout the 1980s, a " sui generis shock therapy " which lowered the ...
In 1981, in order to pay its due debts, Romania requested the International Monetary Fund a line of credit [1] and adopted a policy to pay back all its debt. [3] The decision to repay the debt has been considered irrational, as other developing countries that were hit by the same problem were able to obtain debt rescheduling or "haircuts".
Afghanistan (1978–1989) Albania ... Ceaușescu. Romania." Before austerity, Romania had made considerable progress in many areas. Between 1950 and 1973, Romania ...
Ceaușescu with Jimmy Carter during a visit in Washington, D.C. in 1978. Also, the Socialist Republic of Romania was the first of the Eastern bloc nations to have official relations with the Western bloc and the European Community: an agreement including Romania in the Community's Generalised System of Preferences was signed in 1974 and an ...
The economy of the Socialist Republic of Romania was centrally planned, similar to the one of the Soviet Union. Most of the means of production (including all large and medium enterprises) were owned by the state , which established production plans as part of the Five-Year Plans .
In order to be granted the loan, Romania agreed to raise food and gasoline prices and reduce spending (see 1980s austerity policy in Romania) and to provide additional information about its economy to the fund. [6] [7] It also agreed to reduce the pace of industrialization and to increase investment in agriculture. [8]
Europe's deteriorating economic situation continues to dominate the financial headlines. Fortunately, much of the news this month has been positive. Greece managed to default in an orderly manner ...
In 1981, Ceaușescu began an austerity programme designed to enable Romania to liquidate its entire national debt (US$10,000,000,000). To achieve this, many basic goods—including gas, heating and food—were rationed, which reduced the standard of living and increased malnutrition.