Alexandru Nazare says that Romania can avoid junk status, but it must reduce the deficit and manage the losses from the NRRP: “We are still walking a tightrope”

Finance Minister Alexandru Nazare said in an interview with Antena 3 that Romania can avoid losing its investment-grade rating amid pressure on the budget, public debt and the risk of not fully receiving funds from the NRRP. The country is at the lowest level of the investment-grade category, while rating agencies have a negative outlook.

Nazare rejected the scenario of an inevitable downgrade to speculative grade, commonly known as “junk”. Romania will be assessed by Fitch in January, Moody’s in February and S&P in March. The minister said that maintaining the rating depends on a realistic budget, execution without deviations and deficit reduction.

The deficit target of 6.2% of GDP for 2026 remains in place, although total financing needs are estimated at 278 billion lei. Of this amount, approximately 130 billion lei represents deficit financing, while 150 billion lei involves rolling over older debt.

A major uncertainty concerns payment requests 5 and 6 under the NRRP. Romania knows it will lose some of the funds, but the exact amount has not yet been established. The minister also mentioned outstanding payments for medical leave, debt related to Pfizer contracts and unpaid invoices for projects run by the Ministry of Development. He said deficit reduction is necessary to limit public debt, which has exceeded 61% of GDP, and estimated economic growth of 1.7%-1.8% in 2027.