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.
Romania has signed a major contract with France for the acquisition of Mistral portable short-range air defense missile systems. The agreement was concluded on Tuesday, November 25, between Romania’s Ministry of National Defense and France’s Ministry of the Armed Forces and Veterans, through their respective General Directorates for Armaments. The acquisition is valued at EUR […]
The European Parliament called on November 26 for EU-wide rules to strengthen the protection of minors online, recommending a minimum age of sixteen for accessing social networks, video-sharing platforms, and AI chatbots, according to a statement from the institution,
The government of Romania will be empowered to establish, ex officio or upon request, by Government Decision, an extended surveillance regime over local companies strongly affected by economic sanctions imposed by other states, according to the legislative project prepared by the government, given that the situation of the assets held by the Russian giant Lukoil […]
The European Commission (EC) will reportedly give Romania four more months to appoint permanent management under competitive procedures at 48 state-owned enterprises (SOEs) in the energy sector, after the Romanian government agreed to double the fine paid by the country and the penalties charged to those responsible (ministers) if the milestone set under the Resilience […]
The Romanian banks boasted in 2025 virtually the same record aggregated net profit as in 2024, namely RON 11.6 billion (EUR 2.3 billion, -0.6% y/y) in January-September and RON 6.2 billion (EUR 828 million, -0.3% y/y) in Q3 alone, according to data published by the National Bank of Romania. The non-performing loan (NPL) ratio has […]
The Romanian Parliament approved the National Defense Strategy on Wednesday, November 26, with 314 votes in favor, 43 against, and three abstentions, following a joint session attended by president Nicușor Dan. The document will guide national security policy for the 2025-2030 period. During the parliamentary debate, Ana Maria Gavrilă, leader of the opposition party POT, […]
