A group of international financial investors headed by US bank JP Morgan met Romanian prime minister Ilie Bolojan as part of a regional tour. The visit came as Romania is striving to address major fiscal slippage that prompted equally significant financing requirements.
More precisely, Romania temporarily prevented an imminent sovereign downgrade in July, with a first package of budgetary measures primarily including a VAT rate hike and a promise not to raise public wages and pensions through 2026 after a similarly austere conduct in 2025. A second package of budgetary measures was promoted for enactment by the government recently.
On the budget execution side, the gap risks exceeding 8% of GDP as the expectations deteriorated compared to an optimistic 7.5% of GDP scenario envisaged around the mid-year by the rating agencies Fitch and S&P, among others.
Romania raised EUR 5 billion on July 9 through foreign currency bond sales, marking its return to international markets following a period of fiscal imbalance and political instability. The country had already raised EUR 4 billion in February and EUR 2.75 billion in March with FX bonds denominated in US dollars and euros, out of the total target of EUR 13 billion for the entire year.
The Romanian government has updated the international investors on the reform packages already implemented or under legislative procedures.
“The delegation representatives emphasised that Romania remains a country of interest for financial markets, noting both the growth opportunities and the need for clear fiscal responsibility policies. Another point of interest was internal political stability, considered essential for the continuity of reforms and for maintaining predictability in the economic environment,” the Romanian government announced.
The meeting at Victoria Palace, alongside prime minister Ilie Bolojan, was attended by the head of the prime minister’s chancellery, Mihai Jurca, and the honorary adviser to the prime minister, Ionuț Dumitru – former head of the Fiscal Council.
iulian@romania-insider.com
(Photo source: Gov.ro)
