Fitch Ratings said on Tuesday that the implementation of the latest consolidation package announced by the authorities in Bucharest will reflect in its updated fiscal forecasts at the agency's scheduled sovereign rating review on August 15."How far the announced measures improve prospects for debt stabilisation and begin rebuilding fiscal credibility will also reflect our assessment of their macroeconomic impact and potential implementation risks. As we noted following May's presidential elections, deficit reduction and debt stabilisation are key for the sovereign rating," Fitch said in a release.The package was approved on July 7 by Prime Minister Ilie Bolojan's new pro-EU coalition government. The government estimates that its budgetary impact is 1.1% of GDP this year and 3.5% in 2026. The total impact is evenly balanced between revenue and expenditure measures, with the first wave taking effect on 1 August, followed by additional measures from January 1, 2026, the document notes.According to Fitch Ratings, political risks have eased since the previous government introduced a consolidation package in late 2024 amid heightened tensions triggered by the annulment of November's presidential election. Pro-EU centrist Nicusor Dan won May's rerun presidential election and the four parties in Bolojan's coalition collectively represent about two-thirds of the seats in the Chamber of Deputies and the Senate. Dan and Bolojan have both stressed the need for deficit reduction. Agreeing how to reduce record deficits was part of the coalition negotiations that resulted in ambitious consolidation targets."A significant fiscal consolidation will weigh on economic growth, and implementation risks cannot be discounted. More than half the envisaged additional revenue this year comes from a 2pp increase of the standard VAT rate to 21% and of the current reduced rates of 5% and 9% to a single 11% rate from August. This will generate higher inflation, which will further erode real incomes," the rating agency said.All three major rating agencies (S&P Global Ratings, Moody's and Fitch) have a "negative" outlook on Romania's sovereign rating, which places the country on the verge of a "junk" rating (not recommended for investment).
Former US first lady Michelle Obama, the wife of Barack Obama, was in Bucharest on Thursday, September 18, to serve as the main guest at the second edition of the Impact Bucharest series of conferences. The former first lady spent about an hour in front of a large audience, speaking about her childhood in a […]
Czech president Petr Pavel spent a few days in Romania at the beginning of September while on holiday. According to statement by the Romanian Embassy in Prague, the Czech leader traveled mountain routes by motorcycle and chose modest accommodations. Pavel tried to see as much of what Romania had to offer. He planned his routes, […]
Romania is taking tangible action toward its green transition through sustainable infrastructure projects, public‑private partnerships and green bonds. Experts, government officials and business leaders have gathered today at the CES Bucharest ESG Conference, to present progress and identify solutions through which the public and private sectors can collaborate to build a sustainable and competitive economy. […]
Prime minister Ilie Bolojan announced that he will visit Brussels next week to talk to three European commissioners about deficits, defense, and EU financing. The first meeting will be with the commissioner for economy, Valdis Dombrovskis, as Romania “must adjust the issues related to deficits to be a trustworthy country, so as not to continue […]
A large majority of Romanians, namely 85%, have heard of celebrated composer George Enescu, according to the third edition of the Informat.ro – INSCOP Research Barometer conducted earlier this month. However, the survey shows a slight decline in cultural awareness compared to 2013, particularly among younger generations. The
The volume of trade between Romania and China was almost USD 9.3 billion in 2024, according to official statistics. Trade between the two, however, is not balanced. Romania registered a USD 7.7 billion deficit with China, and a USD 2.1 billion deficit in the first quarter of 2025 as well. The People’s Republic of China […]
