EC concludes Romania breached fiscal consolidation plan, defers disciplinary steps

The European Commission concluded that Romania failed to comply with the national medium-term fiscal-structural plan agreed upon by both sides on November 21, 2024, and initiated the process that may lead to disciplinary measures such as the suspension of funds under the Cohesion and Resilience Facility on July 8. Technically, Romania must come up with convincing corrective actions by the end of the month in order to prevent disciplinary measures.

Romania's budget deficit heads to 8.6% of GDP this year compared to a 7% of GDP target, the EC stressed. The analysis implies limited corrections are needed on the expenditures side (expected to deviate this year by only 0.1% of GDP compared to the target) but much stronger revenues aimed at achieving at least in part the 1.6% of GDP deficit deviation.