The Ministry of Finance in Romania revised the gross borrowing requirement from RON 217 billion to RON 235 billion, according to documents consulted by Profit.ro. 

Initially, Romania planned RON 181 billion gross loan borrowing requirements in line with 5%-of-GDP public deficit this year - while the gap is now estimated at some 7.9% of GDP.

The decision to increase the borrowing cap was announced in the context in which the Treasury reached the RON 217 billion limit with the October loans, and the budget deficit indicated in the fiscal-structural plan sent to the European Commission is 7.9% of GDP (in ESA terms), above the level of 6.9% previously targeted. 

The amount of RON 235 billion should be enough to cover the debt that is coming due, as well as the budget deficit of 7.9% of GDP (cash terms). 

However, the cash deficit could exceed even this level, and the current Government could decide to borrow in advance for the following year as well, considering the elections and the change of the executive expected for the second half of December.

iulian@romania-insider.com

(Photo source: Alexandru Marinescu/Dreamstime.com)