Romania’s Public Debt Reaches Historical Level

Romania’s public debt reached EUR 107 billion in April 2021. This is EUR 24 billion more than in April 2020.

This is the first time when Romania’s public debt reaches 50% of the GDP, and the situation doesn’t seem to improve until the end of the year. Even more, specialists estimate that by the end of the year, Romania will exceed the 50% level by far.

Even though the pandemic didn’t hit the economy so hard, as the country had a decrease of only 3,9%, Romania contracted loans summing up to EUR 24.8 billion during the last 12 months, from April 2020 until April 2021 and the Government continues to do so.

Foreign rating agencies, IMF, and even the World Bank estimate a growth of the Romanian economy by 6% in 2021 and in 2022 respectively. Yet, with a public debt above 50% of the GDP, Romania has to also take into consideration the burden of the loans, plus the interests over the next years. In this context, the growth might not be so visible when it comes to public investments or public spending.