BNR Advisor: Romania risks an economic crisis due to excessive budgetary spending

Romania is facing an extremely vulnerable economic period, warns BNR advisor Eugen Rădulescu, who emphasizes the waste of resources from the Reserve Fund, essential for managing crises. Rădulescu states that the state has spent resources that should have been preserved for emergencies, leaving the country without tools to react in the context of international tensions.

The budget deficit has reached an alarming level of 9.3% of GDP, and excessive borrowing will generate high costs for the state, estimating that Romania will pay 3% of GDP just in interest. Rădulescu emphasizes that the imprudent budgetary policy of recent years, starting from 2017, has led to a constant increase in spending, without tempering the impact of previous economic crises.

In the medium term, the wave of retirements will reduce the number of taxpayers and increase the number of pension beneficiaries, which further complicates the economic situation. Rădulescu warns that a political crisis could quickly trigger a severe economic crisis, in the context of tensions within the governing coalition.