Romania’s government has announced a raft of spending cuts and tax rises to rein in the country’s huge budget deficit, taking a major political gamble ahead of a bumper election year in 2024. Analysts, however, say the fate of the proposed package is not assured.
Romania is currently in the European Union’s excessive deficit procedure after its budget shortfall hit 4.6 per cent of GDP in 2019.
Having reached 5.7 per cent in 2022, the government of the Social Democratic Party, PSD, and the National Liberal Party, PNL, has set a target of 4.4 per cent for this year. Yet the current budget in May shows a cumulative deficit of 2.32 per cent over the first five months, compared to 1.48 per cent over the same period of 2022.
