Fitch Ratings on Friday affirmed Romania's Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'BBB-' with a Stable Outlook, the agency reported on Friday."Romania's 'BBB-' rating is supported by EU membership and related capital inflows that support income convergence, external finances, and macro stability. GDP per capita, governance and human development indicators are above 'BBB' category peers. These are balanced against large twin budget and current account deficits (CAD) relative to peers, a weak record of fiscal consolidation, high budget rigidities, and a fairly high net external debtor position."The budget deficit (ESA terms) in 2023 is estimated at 6.1% of GDP, practically unchanged since 2022 and well above the initial government target of 4.4% of GDP. Fitch revised up the deficit path over the medium term in light of the less favourable starting position and the significant legislated pension increases in January and September 2024 with an estimated impact of 1.8% of GDP fiscal easing in 2025.Fitch projects general government deficits of 6% of GDP in 2024 and 6.4% in 2025."We expect meaningful fiscal consolidation over the medium term, helped by the re-introduction of EU fiscal rules, although there are significant downside risks, given current uncertainties around post-election fiscal plans and recent fiscal slippage has negatively affected policy credibility. "Fitch forecasts 3% growth in 2024 and 2025, as the growth momentum of the Romanian economy slowed in 2023 similar to the pattern in most EU members. The annual average GDP was 2% in 2023 according to preliminary data. "The large inflows of EU funds, including the cohesion funds from the new multiannual (2021-2027) financial framework and the recovery and resilience funds, will remain key drivers of growth and investment over the medium term. Beyond the direct demand stimulus, EU funds should also improve the growth potential of the economy, accelerating the catch-up towards the EU level."Fitch says that failure to consolidate the fiscal accounts over the medium, leading to a significant increase in the public debt to GDP ratio, is a factor that could, individually or collectively, lead to negative rating action/downgrade, whereas sustained reduction of the budget deficit that supports a firm decline in public debt/GDP over the medium term is a factor that could, individually or collectively, lead to positive rating action/upgrade.
Romanian president Nicușor Dan is scheduled to be in the United Kingdom on Tuesday and Wednesday, December 16-17, to meet with representatives of the business environment and the Romanian community. On the first day, the head of state will hold meetings with Romanian representatives from the business environment in the UK, as well as with […]
More than 300,000 older people living in Romania’s urban areas are expected to spend Christmas alone, according to data cited by the NGO Niciodată Singur – Friends of the Elderly, which recently launched its annual holiday campaign aimed at tackling loneliness among seniors. The initiative, titled “Be the Carol That Breaks the Silence,” is based […]
The Romanian Senate adopted a simple motion initiated against environment minister Diana Buzoianu on Monday, December 15. The motion passed after the Social Democratic Party (PSD), the largest party in the governing coalition, joined the far-right opposition party AUR in the initiative. The vote for the simple motion was carried after a no-confidence motion filed […]
Romanian farmers are set to benefit from improved access to financing following a EUR 25 million loan granted by the European Investment Bank (EIB) to Agricover Credit IFN SA, aimed at supporting micro agricultural businesses across the country. The funding will be provided under the InvestEU mandate and is intended to boost productivity and promote […]
Romanians rank among the most satisfied homeowners in Europe, but rising housing-related costs continue to put significant pressure on household budgets, according to the RE/MAX European Housing Trend Report 2025. The study showed that 81% of Romanians are happy with their living situation, above the European average of 77%, while 83% live in owner-occupied properties, […]
The Grand Chamber of the European Court of Human Rights (ECHR) on December 15 ruled in favor of judge Cristi Danileţ in his case against Romania and ruled that the Romanian authorities had violated Article 10 of the European Convention on Human Rights that guarantees freedom of expression, which includes the right to hold opinions […]
