Ionuț Dumitru, the advisor to Prime Minister Ilie Bolojan, stated that although the budget deficit was reduced last year, the pressure on public debt remains high. The increase in defense spending and the inefficient use of tax revenues contribute to budgetary tension. Romania has the lowest share of tax revenues in GDP in Europe, at only 28%, which affects the ability to finance social spending.
Dumitru emphasized that nearly 90% of tax revenues are consumed by public sector salaries and social assistance, especially pensions. Additionally, 3% of GDP is allocated to interest payments, which limits fiscal space. Geopolitical pressures and NATO obligations further complicate the situation, imposing additional increases in defense spending, making fiscal consolidation even more difficult.
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