Romania’s gross external debt contracted by 6.3% y/y to EUR 94bn at the end of May 2014, further sliding from the EUR 100bn peak level reached in March-April 2013, the central bank reported. Medium and long-term debt contracted by 4.3% y/y to EUR 76.1bn at end-May from its EUR 81bn peak level.

However, after filtering out the loans extended by the IMF to the central bank and paid back last year, the country’s adjusted external debt on medium and long term edged up by 1.4% y/y to EUR 73.4bn – slightly more than 50% of the annual GDP.

Notably, the external public debt keeps rising significantly – by 7% y/y [EUR 1.9bn, more than 1% of GDP] to EUR 29.7bn at the end of May. From the end of 2008 – meaning during the recession period, the external public debt more than tripled, or increased by more than EUR 20bn [14% of GDP] in absolute terms.

The private external debt has not changed dramatically during the recession period moving from EUR 35.5bn at the end of 2008 to EUR 36bn at the end of May 2014. Over the past year, the private external debt contracted by 1.1% y/y [EUR 396mn].

The gross external debt data also reveals the repayment of the IMF loans by the central bank – EUR 4.4bn over the past year. The Fund has also extended loans to the government, along with the EU, under the broad EUR 20bn 2009-2011 financial stabilisation package. But the loans borrowed by the government can be treated as public debt – except for the preferential conditions enjoyed by the government.