Romania\u2019s public debt edged down in June 2024 by RON 2.2 bln to RON 860.1 bln (EUR 172.8 bln) at the end of the month, according to\u00a0data\u00a0published by the Finance Ministry.\u00a0<\/p>\n
The debt-to-GDP ratio edged down to 51.4% from 51.5% at the end of May but remained above the 50% threshold for the fifth month in a row, and further GDP revision will not change this radically.\u00a0<\/p>\n
Although the government was compelled under the Fiscal Responsibility Law to take measures in case the public debt remains above the 50% threshold for six consecutive months (which most likely was the case this year), the Executive suspended the provisions of the Law under an emergency government ordinance (OUG 112\/2024) passed on September 23 and published on September 25, according to G4media.ro<\/a>.<\/p>\n Compared to the end of 2023, Romania\u2019s public debt increased by RON 76.6 bln (EUR 15.4 bln).<\/p>\n Romania\u2019s public debt has increased substantially starting with the Covid-19 crisis in 2020, but the indebtedness ratio remained under the 50% threshold over the four years prior to 2024 thanks to the robust expansion of the nominal GDP (amid a combination of high inflation and strong economic growth in most of the years). However, the slower economic growth this year and lower inflation (GDP deflator) failed to \u201cdilute\u201d the indebtedness ratio that remained above 50% starting with February.\u00a0<\/p>\n The debt-to-GDP ratio rose by 2.6 percentage points during the first half of 2024 (H1) compared to the end of\u00a02023 amid a 4%-of-GDP public deficit. The deficit will further rise by nearly 3% of GDP in H2, predictably keeping the indebtedness ratio above 50%.\u00a0<\/p>\n The government already tapped the international debt market in September with EUR 5 bln FX bonds, and more issues may follow by the end of the year.<\/p>\n Romania\u2019s public debt under the national methodology, which includes the debt owed by the local Treasuries to the central Treasury as well as the government\u2019s commitments, reached RON 1,011 bln at the end of June \u2013 or 59% of GDP.<\/p>\n