Romania's Govt. plans EUR 8 bln external loans in the next 2 years

Romania’s Government wants to borrow about EUR 8 billion from foreign markets in the next two years to cover the budget deficit, which is now at the maximum level allowed by the EU, and to refinance external debts that will mature. For the operation to be possible, the Government will significantly increase the maximum limit of Romania's indebtedness to foreign markets, from EUR 20 billion to EUR 27 billion, reports local Profit.ro. The current limit is EUR 20 billion, but the state’s external debt has already exceeded EUR 19 million. This doesn’t leave the Government space to borrow EUR 8 billion in the next two years. Romania has recently sent banks calls for proposals for a new Eurobond issue. The state has borrowed EUR 2.75 billion from foreign markets this year. Last year, the state borrowed EUR 3.25 billion through Eurobond sales. The Government estimates the budget deficit for this year at 2.96% of the GDP, close to the 3% limit imposed by the EU. The draft budget for next year also provides a deficit of 3% of the GDP, but the European Commission and several financial institutions have warned that the deficit will surpass this threshold. editor@romania-insider.com