The 2025-2026 budget correction package can avoid the downgrading of Romania's sovereign risk and there is no alternative to a severe correction, says the Fiscal Council, which published an Opinion on the package of fiscal measures for which the Government assumed responsibility."The 2025-2026 budget correction package can avoid the downgrading of Romania's sovereign risk. There is no alternative to a severe correction. The optimality of the package of correction measures examined is difficult to assess, especially since distributional aspects (including equity) and second-round effects come into play. The budget correction, which means a reduction in internal absorption (affecting personal income, corporate revenues), is the price we must pay to ensure the sustainability of public debt and avoid an even more severe correction," argues the Fiscal Council.According to the same document, the substantial fiscal adjustment package will have an important effect in terms of narrowing the external imbalance.In the context, the Fiscal Council showed that the analysis of the budget execution for the first 5 months of 2025 is likely to worsen the Fiscal Council's adoption of the draft budget, which saw a cash deficit of around 7.7% of the GDP. Thus, in the absence of the adoption of measures to correct the budget deficit, the dynamics of the main categories of income and expenditure in the first part of 2025 appear compatible with a cash budget deficit of more than 8.5% of the GDP, the same source estimates."The Fiscal Council estimates that the adoption of a consistent package of measures to correct the budget imbalance represents an absolute emergency. In the absence of a credible, firm package of measures, the risk of blocking access to financing and refinancing becomes imminent," the Opinion also states.The Government assumed responsibility, in Parliament, on Monday, for the first package of fiscal measures to reduce the budget deficit.
The government has reportedly been sued for failing to organize the election for Bucharest mayor within the legal deadline of 90 days from the vacancy of the post, according to Antena3.ro. The authors of the complaint are not disclosed, but the reformist...
Romania's isolationist party AUR consolidated its leading position in two polls carried out by Avangarde and CURS, although the scores and the advance versus the primary challenger – the Social Democratic Party (PSD) – differ significantly between the two estimates. The isolationists' leading position, still not challenging the combined score of the four parties in […]
Romania's public debt surged by RON 21.5 billion in May alone and by RON 70.7 billion year to date, reaching RON 1.035 billion (EUR 204.1 billion) or 57.8% of GDP at the end of May, according to data published by the Finance Ministry. Romania's public debt rose by RON 70.8 billion (EUR 14 billion) […]
The giant Procter & Gamble recently started a production line in Romania, at the Urlați factory in Prahova County, according to Revistaprogresiv.ro. The company will produce Lenor scented pearls here, one of the company's latest innovations in fabric care. Four years ago, the company inaugurated...
The CFA Romania Association's Macroeconomic Confidence Indicator increased by 2.3 points in August, to a still very modest level of 37.2 points, with both components (current conditions and expectations) in the recessionary side of the 0-100 point scale. The indicator bottomed out in July after the newly formed government pushed the first package of budgetary […]
The first package of budgetary measures legislated in July will have an impact of 3% of GDP on the next year's general government's budget, bringing it down to 6% of GDP, prime minister's adviser Ionut Dumitru, Raiffeisen Bank chief economist and former Fiscal Council head, told
