Finance Minister Alexandru Nazare warns that Romania must reduce its deficit and avoid being downgraded to “junk” status

Finance Minister Alexandru Nazare warns that Romania must maintain fiscal discipline in 2027 as public debt has reached approximately 60% of GDP and financing costs are rising. Protecting the sovereign rating and avoiding a downgrade to junk status are, according to the official, essential objectives.

In a message posted on Facebook on Friday, Nazare said the current situation is the result of several years of insufficiently controlled public spending, accumulated debt and postponed reforms. The budget deficit fell from 9.3% of GDP in 2024 to 7.9% in 2025, while in the first eight months of 2026 the cash deficit stood at 2.89% of GDP, compared with 4.51% during the same period last year.

At the end of July, public debt stood at approximately 1,205 billion lei. In the first eight months, the state paid 42.1 billion lei in interest, 26.7% more than in 2025.

The government is targeting a deficit of 6.2% of GDP for 2026, but pressures will continue in 2027, including through the loss of PNRR grants and the persistence of high interest rates. Nazare argues that the future budget must be built on realistic revenues, clear priorities and permanent sources for permanent spending.

The first rating review of 2027 is expected in January from Fitch. The minister advocates reducing spending, improving revenue collection and protecting investment, which increased by 19.9% in the second quarter of 2026.