Romania's public debt down to six-year low: 35.2 pct of GDP in 2017

Romania’s public debt down to six-year low: 35.2 pct of GDP in 2017

Romania’s gross public debt declined last year to 35.2 percent of Gross Domestic Product (GDP), down from 37.6 percent of GDP in 2016, due to the rapid growth of the economy, which outpaced the increase in the debt, Ministry of Finance data show.

The level of public debt, measured as a share of GDP, was a six-year low in 2017. Romania’s public debt increased rapidly after the financial crisis, which hit hard the Romanian economy and generated large fiscal gaps.

The public debt reached a record-level of 39.4 percent of GDP in 2014, but decreased constantly since then.

The amount of public debt increased to RON 301.65 billion (EUR 64.7 billion) in December 2017, according to the Ministry of Finance, up 5.4 percent from December 2016.

But Romania’s GDP surged by 7 percent in real terms (and by 12.3 percent in nominal terms) last year against 2016 to RON 856.35 billion (EUR 187.5 billion), according to National Institute of Statistics (INS) latest data, outpacing public debt’s increase.

In 2016, the GDP was estimated at RON 762.3 billion (EUR 169.8 billion).

Official data show the bulk of the public debt (95.2 percent) is central goverment’s debt and only a small fraction belong to the local authorities in Romania. Almost half (48 percent) of the debt is RON-denominated and 43.4 percent is EUR-denominated.

Romania had the fifth-lowest public debt among the 28 European Union member states in 2016, after Estonia (9.4 percent), Luxembourg (20.8 percent), Bulgaria (29 percent) and Czech Republic (36.8 percent), according to Eurostat series.