Prime Minister Ilie Bolojan has announced that the Ministry of Finance has published the draft2026 national budget, saying that the government intends to approve it by the end of the week and send it to Parliament for approval.
"This year's budget is built in a difficult economic context and must meet several challenges simultaneously. The government must narrow its deficit, keep up a high level of investment, manage the high cost of interest rates, make the public administration more efficient and, at the same time, put the economy on a sounder footing," Bolojan wrote on Wednesday in social media post.
He added that narrowing the budget deficit and strengthening the state's financial balance is one of the main challenges of this year's budget.
"The first big challenge is to narrow the government deficit. Romania must decrease its cash deficit from about 7.7% of GDP, that is RON 146 billion in 2025 to 6.2% of GDP, that is RON 127.3 billion, which translates into an adjustment of approximately RON 18.3 billion. This adjustment is not just an accounting exercise of the government. It is an effort of the entire economy and of the entire society. Narrowing the budget deficit means the approximation between the government's outlays and receipts it collects. In other words, the government must spend more responsibly and size its programs so that the difference between receipts and outlays becomes smaller. That is why narrowing the deficit involves difficult decisions regarding public spending priorities ," added Bolojan.
He said that keeping up a high level of investment is another major challenge.
"At the same time, Romania must keep up a large volume of public investment. Why? We have over 20,000 investment projects at different phases, in all localities of the country, and in the past years projects were over-contracted above the normal financing capacity. In addition, this year marks the end of an important cycle of accessing European funds. The priority is the implementation of investment projects financed under the National Recovery and Resilience Plan (PNRR). The deadline for completing the PNRR absorption is the end of August. Romania still has to draw some over EUR 10 billion under PNRR, to which are added several billion lei of co-financing from the state budget. The investment budget proposed in the draft budget increases to over 160 billion lei, i.e. about 8% of GDP," Bolojan said.
The prime minister also spoke about the high cost of interest, which he described as a significant pressure on the budget.
"Another important pressure on the budget is the raising cost of interest that Romania has to pay on the public debt. Although market interest rates have started to fall, the total level of payments remains high due to the accelerated growth of debt in recent years. In 2026, Romania will pay about RON 60 billion lei in interest, i.e. almost EUR 12 billion, meaning 3% of GDP. By way of a comparison, the amount means the value of the Anghel Saligny investment programme for five years or the cost of the construction of the Bucharest-Pascani highway."
The prime minister explained that another challenge for the budget construction is cutting staff expenses and the efficiency of the administration.
"In order to make room in the budget for public services and to keep up investment, it is necessary to cut staff expenses in the public sector. In the coming months, ministries and public institutions must reorganise their structures and make savings. It will not be an easy process. The draft budget provides for cuts in staff spending and keeping under control the current state expenditures, without affecting the support for vulnerable categories, which remains around RON 250 billion. The goal is to use public money more efficiently, to direct more resources towards investment and development and to create a simpler, more efficient administration that is closer to the citizens."
The prime minister also said that this year's budget must also contribute to building a healthier economy in the long term.
"In addition to budget adjustments, it is important that the economy is put on a more solid footing. That means, among other things, increasing the number of people active on the labour market, stimulating production and exports and supporting private investment. Only in this way can we create more value and well-being for Romanians, ensuring the necessary conditions for a more competitive and resilient economy," Bolojan said.
The way in which these challenges will be met will influence Romania's financial stability and the pace of economic development in the coming years, Bolojan concluded.
Comentează