Standard&Poor’s and Moody’s reconfirmed Romania’s rating : perspective is stable

The international agency for financial evaluation Standard&Poor’s reconfirmed Romania’s rating for short and long term in foreign currency and in the national currency at BBB minus/A-3, according to a press release of the agency.The rating perspective is stable.In April, this year, S&P improved from negative to stable the rating perspective of Romania.   The evaluation agency keeps its view point according to which the consolidation trend of Romania will ensure that the governmental debt and the external one will be moderate until 2024. ‘ We expect that the fiscal efforts of the government be facilitated by the economic recovery as there seems the economic activity is not affected by the political instability periods’ the S&P press release says.According to the evaluation agency, Romania’s economy registered a strong recovery in 2021 so that the S&P analysts expect this year a growth of GDP of 7% followed by stable evolution in 2022 – 2023 once the recovery of the private consumption and the increase of investments, especialy in the public area.The latter will be stimulated by the investments agenda of the government which, in its turn, is supported by the EU funds allocated to Romania. Even so, the recovery of the economy faces obstacles, taking into consideration that the fourth wave of the pandemics hit Romania strongly, says S&P. ‘ Our economic estimates stay sensitive to the situation still uncertain regarding the pandemics and the new delays in the vaccination campaign taking into consideration the high degree of hesitation with regards to the vaccine. The weak degree of absorption of the EU funds constitutes a risk as well’ the S&P press release says. The Moody’s agency reconfirmed on Friday the sovereign rating for governmental debt of Romania at Baaa3/P-3 for long and short term in local currency and foreign currency debt and improved the negative perspective to stable, informs the ministry of finances.   The confirmation of Romania’s rating to ‘Baaa3’ balances the solid potential of growth of the country and the expectations of gradual improvement of the fiscal indicators as the deficit of current account is high (5% of GDP in 2020) and of the political inconsistancy, resulting from the coalitions of instable governing, says the agency.The rating is supported by the Moody’s expectations that the potential of post-pandemics growth of Romania will say supported by a dynamic private sector, including the presence of foreign companies who have been in the country for a long time and who concentrate on activities with added value, medium to high in the production sector.The confirmation of Romania’s rating at ‘Baaa3’ reflects the solidity of the governance and the moderate institutions of the country.    The risks at the address of the macroeconomic perspective present negative trends : the vaccination rate in Romania still low could affect the economic activity if new restrictions are introduced by the authorities to stop the rapid extension of the pandemics in October 2021, says the agency.Estimated at approximately 3-4% by the European Commission and IMF, the growth potential of Romania is one of the highest in the EU. Already solid, the growth perspective will also benefit from the EU programme ‘ Next Generation’.