Romania's public debt reached RON 498.3 billion (EUR 102.3 bln) at the end of 2020 after it leaped by RON 34.4 bln (over EUR 7 bln) in December alone.

The debt-to-GDP ratio rose to 47.7% of GDP at the end of 2020, after a 3.3pp advance in the last month of the year.

Last year, Romania's public debt increased by RON 125 bln (EUR 25.6 bln), and the debt-to-deficit ratio advanced by 12.4pp from 35.3% at the end of 2019.

Romania's economy decreased last year by 3.9% compared to 2019, a better result than previous estimates, and the budget deficit widened to 9.7% of GDP.

This year's moderate fiscal consolidation is likely to keep the public deficit at an elevated level of above 7% of GDP, which will predictably bring the public debt up to over 50% of GDP.

On the upside, the robust buffer announced by prime minister Florin Citu and the positive GDP growth are cushioning the pressure generated by the large financing needs.

(Photo: MattWatt / Dreamstime)

iulian@romania-insider.com