WB: Romania Is Vulnerable to European States Debt Crisis

According to a World Bank report released today, Romania finds itself among states that are vulnerable to the debt crisis in Europe, because its financial sector is closely linked to those highly indebted states (Greece, Spain, Portugal, Ireland and Italy).

 

 

"Also at risk are countries whose financial sectors are closely linked to these highly indebted countries. Albania, Bulgaria, Romania, and Serbia are economies that have benefitted in the past from heavy capital inflows from Greek financial institutions," the World Bank said in its summer 2010 Global Economic Prospects report.

 

 

A default or a major restructuring of the most indebted high-income states in the EU could have major consequences for the global economy, because the full-fledged recession these countries would be plunged into, but also because of the potential knock-on effects on crediting institutions elsewhere in the world, WB noted.