In addition, the authorities intend to Increase the transparency of the structure of our public finances, start the public administration reform, including by increasing the transparency of public employment and remuneration, complete the privatization of infrastructure enterprises on national and municipal level, strengthen financial sector regulation and move cautiously toward consolidating financial sector supervision under one independent authority, and continue the reform of the public health care system. These efforts are needed to further improve productivity and maintain export competitiveness. Maintaining competitiveness The appreciation of the real exchange rate is the reflection of real convergence and, thus, should not indicate the loss in competitiveness per se. Indeed, nominal convergence caused by real convergence may not decrease competitiveness, provided that macroeconomic stability is maintained. Thus, care should be taken to avoid excessive real exchange rate appreciation as a result of to optimistic expectations, expansionary official or private foreign borrowing or rapid inflows of short-term capital.
Macroeconomic stability is the sine qua non for maintaining the competitiveness of the economy.
Special emphasis must be put on fiscal credibility and maintaining the sustainability of current account deficit and its financing. The principle of balanced budget over the business cycle is also consistent with the harmonization of fiscal policy with EU requirements under the Growth and Stability Pact. Equally important is further restructuring and privatization. In particular, the latter will increase the transparency, efficiency and competition in sheltered sector of the economy, thereby promoting more flexible price formation of infrastructure and other essential services. The competitiveness was and will be based on the transfer of technology connected to FDI inflows.