Romania’s public debt reaches 48.9% of GDP at end-2023

Romania’s public debt reaches 48.9% of GDP at end-2023
/ bne IntelliNews
By bne IntelliNews March 15, 2024

Romania’s public debt (chart) increased by RON117bn (€23.4) during 2023, which accounts for some 7% of the country’s GDP – not far from the 25.9% advance during the COVID-19 crisis in 2020.

The public debt to GDP ratio edged up, however, by only 1.7 percentage points (pp) to 48.9% remaining safely under the 50% threshold.

Romania’s public indebtedness has remained moderate over the past three years thanks to a combination of inflation (particularly last year) and robust real economic growth. However, as both these factors are diminishing in intensity over the coming years, the fiscal deficit, expected to remain around 6% of GDP for at least 2024-2025, will put pressure on the public debt to GDP ratio, eventually pushing it above 50%. 

Although not at high levels in absolute terms, Romania’s indebtedness may hinder fiscal consolidation efforts if investors turn risk-averse to the region or Romania in particular.

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