The public deficit increased in the first three months of 2022 (Q1) by 7% compared to the same period in 2021 in nominal terms, to RON 15.7 bln, Romania’s Finance Ministry announced on April 27.

But the deficit-to-GDP ratio decreased by 0.05 percentage points, from 1.24% to 1.19%. Romania’s general government budget deficit was 6.7% of GDP in 2021, and the Government drafted a budget planning envisaging a 5.8%-of-GDP gap this year, assuming 4.3% GDP growth.

The evolution of the deficit-to-GDP ratio in Q1 is explained by the increase of total revenues-to-GDP ratio by 0.66 percentage points to 7.9% of GDP, driven by the stronger VAT revenues (+39.3%) and by the increase of other taxes on goods and services (+4.4 times).

The revenues of the general government budget amounted to RON 104 bln in the first quarter of 2022, 21.3% more compared to the same period last year.

On the other hand, the expenditures-to-GDP ratio increased by 0.61 percentage points to 9.1%. The expenditures, in the amount of  RON 119.75 bln, increased in nominal terms by 19.2% compared to the same period of the previous year. The social protection expenditures (+21%) made the most important contribution.

(Photo: Octav Ganea/ Inquam Photos)

iulian@romania-insider.com