Interim PM Bolojan: Romania must resist populist spending, shift economy from consumption to investment

Interim Prime Minister Ilie Bolojan said Romania urgently needs a government capable of consolidating the progress made so far, continuing the shift in the economic model from consumption towards investment, keeping public spending under control and collecting revenue efficiently so that the economy can grow naturally, on sound foundations, towards genuine prosperity."We are at an important point in Romania's development. We changed direction last year, and the measures taken so far have worked. The deficit has fallen this year as well. (...) In the first seven months of 2026, it was 37% lower than in the same period of 2025. Every percentage point of reduction brings us closer to a balance in which we consume what we produce, not what we borrow," Bolojan wrote on Facebook on Monday.He said government personnel expenditure has fallen, while investment has been maintained with the support of European funds."In the first seven months, public investment reached 76 billion lei, almost 15 billion lei more than last year. This is the right direction: we are reducing expenditure that cannot be sustained and protecting investment that develops Romania," Bolojan said.He acknowledged that the budgetary adjustment has also resulted in an economic contraction and stressed the collective effort made by society."Yes, this correction has also had a contractionary effect on the economy. Consumption has fallen by the part that was financed through debt, with borrowed money. The economy has lost the growth - in fact, illusory growth - generated by this debt-financed consumption. It was a collective effort by society, for which I thank Romanians," he said.Bolojan stressed that the current interim government arrangement should not continue, as the powers available to an interim government are limited."We managed to complete the NRRP, maintain confidence in Romania through two rating assessments and navigate overlapping domestic and external crises. But the instruments available to an interim government are limited. Moreover, political uncertainty and the failure to adopt the public-sector pay law, because of PSD's irresponsibility, are creating doubts about whether spending can remain under control in the years ahead. From this point on, there are two possible paths. Which one we take will depend on the future government. Whoever comes to power will have to answer the question: how can we reduce the budget deficit as a share of GDP in 2027 (5.3%) and in 2028, given that NRRP grants will no longer be available, defence spending will not be able to fall but will instead increase, while wages and pensions will have to be indexed and will not decline as a share of GDP? This comes at a time when interest costs will remain a challenge in the years ahead, after we increased our debt levels too rapidly during the period of large deficits," Bolojan explained.The interim prime minister also warned that the next government will have to continue structural reforms."If it fails to continue the structural reforms or, worse still, gives in to the populist temptation to turn on the taps of money and consumption, we will find ourselves in an even worse situation than before, because no lender will believe that we are capable of changing. Romania must avoid that scenario. We urgently need a government that consolidates what we have achieved so far, continues the shift in the economic model from consumption to investment, keeps public spending under control and collects revenue efficiently, so that the economy can grow naturally, on sound foundations, towards genuine prosperity," Bolojan said.According to the interim prime minister, such a government can only be led by "a responsible prime minister who fully understands the situation, a prime minister willing to make the constant and often unpopular effort to do what is necessary, not what sounds good"."A prime minister willing to work for the country, with his resignation on the table if necessary, and who has a credible governing programme," Bolojan concluded.