The Japan Credit Rating Agency - JCR on March 27 improved the outlook on Romania’s sovereign debt to stable from negative. The rating was affirmed at BBB for the long-term foreign debt and BBB+ for long-term domestic currency debt - one, respectively two notches above the non-investment grade.

Romania returned to the JPY bond market in October 2024 when it launched three issues with maturities of three, five, and seven years.

The rating agency based its decision on the fiscal consolidation measures taken by the new government that took office in mid-2025. 

For this year, JCR expects 1% economic growth driven by investments funded under the European Union’s Resilience facility (RRF), which will furthermore force the country to implement reforms.

Over the medium term, private consumption is expected to gradually recover as fiscal tightening runs its course, and growth is projected to return to around 2%, supported by inflows from the EU’s Multiannual Financial Framework. 

JCR’s expectations in terms of fiscal consolidation are built on the government’s promise to bring the deficit down to 6.2% of GDP in 2026. Based on the additional fiscal package enforced in January, including higher taxation on dividends and a freeze on public-sector wages and social benefits, the government expects the fiscal deficit to narrow to 6.2% of GDP. 

For medium- to long-term fiscal consolidation, however, JCR said that it will be important to keep the growth of net expenditure, defined as the benchmark for fiscal management, within the level recommended by the EU Council in July 2025. 

Although the government debt-GDP ratio has risen sharply in recent years, reaching 59.6% at the end of 2025 from 49.3% at the end of 2023, it still stays low relative to other countries, JCR pointed out. The rating agency expects the ratio to stabilise “as the fiscal deficit decreases,” but avoided providing any estimate for the level eventually reached.

iulian@romania-insider.com

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