Romania's budget deficit decreases by 37% in 2026's first seven months

Romania has made significant strides in reducing its budget deficit, which fell by 37% in the first seven months of 2026. The deficit now stands at 48.08 billion lei, a substantial decrease from the 76.44 billion lei recorded in 2025.

This improvement translates to a reduction of 28.36 billion lei, leading to a decrease in the deficit's share of GDP from 3.99% to 2.34%. This positive shift represents an improvement of 1.65 percentage points in the budget deficit's ratio to GDP.

State revenues have also shown robust growth, rising by 11.2% to reach a total of 412.31 billion lei during the same period. Notably, revenue from salary and income taxes amounted to 38.34 billion lei, with salary tax revenues increasing by 5.2%. Furthermore, dividend taxes experienced a significant rise of 19.5%, and collections related to the Unique Declaration grew by 19.7%.

Despite this positive financial outlook, total expenditures advanced only modestly by 2.9% in the first seven months of 2026. Alexandru Nazare, the interim Minister of Finance, emphasized the importance of maintaining spending discipline and accelerating the absorption of European funds. He noted that the current budget execution results will be critical in discussions with rating agencies like S&P.

Economic consultant Adrian Negrescu remarked that the decline in the budget deficit is a positive sign. However, he warned that Romania faces over 20 billion euros in debts due next year, with more than 10 billion euros needed just for interest payments. He believes the new government must continue its efforts to reduce the budget deficit, targeting 6.2% of GDP for this year and aiming for 5% in 2027.