The financial rating agency Moody's Ratings confirmed on Friday Romania's rating at "Baa3" but changed the outlook associated with the rating to "negative" from "stable," according to a press release from Moody's.The decision to change the outlook to negative reflects the risk that, in the absence of additional fiscal consolidation measures, Romania's fiscal strength could significantly weaken in the coming years, the rating agency said.According to Moody's baseline scenario, Romania's fiscal deficit will remain at a high level in 2025, at 7.7% of GDP, and will improve only gradually thereafter, which will increase the government debt burden to 68.5% of GDP by 2028. In the absence of significant improvement in the fiscal outlook, there is a risk that Romania's credit profile could deteriorate significantly compared to that of other countries with a "Baa3" rating.According to the rating agency, the confirmation of the "Baa3" rating for Romania reflects the size and moderate growth potential of the economy. On the other hand, Romania's credit profile is constrained by its high vulnerability to a risk event, given its increased exposure to geopolitical risks due to its proximity to the war in Ukraine.Based on the policies announced so far by the government, Moody's forecasts that the fiscal deficit will decrease from the 8.7% of GDP level reached in 2024 but will remain high at 7.7% of GDP in 2025 and will improve only gradually thereafter. Combined with a downward revision of Romania's growth forecasts, this will quickly push up the government debt burden to 59.3% of GDP by the end of 2025, and to 62.7% of GDP by the end of 2026, up from 48.9% of GDP at the end of 2023.The rating agency specifies that the rating outlook could be returned to "stable" if the indicators related to the government debt burden and debt affordability deteriorate significantly less than the current estimates. However, most likely, this would require the adoption of additional fiscal consolidation measures and improvement in spending discipline.
Romania has reached a purchasing power per capita of EUR 11,105, approximately 45% below the European average – a figure that places the country in 31st place in the European top, according to the "NIQ Purchasing Power Europe 2025" study. Compared to 2024, Romania moved up one position in the NIQ ranking. Comparatively, at a […]
Ionuț Costea, former head of EximBank, and Sebastian Vlădescu, former finance minister, were released on November 5 following an extraordinary prescription procedure, according to a statement from Romania's High Court of Cassation and Justice (ICCJ). The two had been sentenced in 2023 to six and seven years in prison, respectively, for taking a EUR 5.5 […]
Prime minister Ilie Bolojan, who also serves as president of the Liberal Party (PNL), stated on November 4 that, at the meeting of the party's National Political Bureau the same day, support was renewed for resolving the issue related to special (magistrates') pensions this month, but also for the reform in public administration, according to
Knauf Insulation Romania, the local subsidiary of a division of the German group Knauf, has officially inaugurated its new glass mineral wool factory in Târnăveni, Mureș County, after an investment of EUR 140 million, for which the company also received EUR 18 million in state aid. "Our factory in Târnăveni, equipped with state-of-the-art technology, has […]
Corden BioChem, an expert in industrial biotechnology, could resume production at the bioethanol factory it took over from Swiss Clariant in southern Romania (or "Lesser Wallachia" as indicated by the company) at Podari, after the Competition Council authorised the takeover of the steam and electricity supplier. The company announced on its website that the Podari […]
Romania’s general government budget deficit can drop below 6.5% of GDP next year, possibly approaching 6% of GDP, to further drop below 5% of GDP if the tax evasion and tax avoidance are addressed, the head of the Fiscal Council, Daniel Daianu, said, speaking in a conference organised by Curs de Guvernare, as reported by […]
