IMF Approves New EUR1.98 Billion Precautionary Credit Line for Romania

    WASHINGTON--The International Monetary Fund approved a 1.98 billion-euro credit line for Romania on Friday to help the country ward off shocks to its fragile economy.

    Romania will treat the credit line as a precautionary reserve and will only tap it in emergencies. The government has also requested a EUR2 billion line from the European Union. The financing should help assure investors that authorities have ample resources to handle potential crises.

    The IMF said that while the Romanian economy had cut its trade and budget deficits, and made progress toward bolstering the economy, growth is still weak.

    "The economy is still vulnerable to shocks, including volatile capital flows, and the reform agenda remains unfinished," said Nemat Shafik, an IMF first deputy managing director.

    Write to Ian Talley at