Romania’s public administration consolidated debt increased by 3.6 percent in the first quarter of 2014, to RON 263 billion (EUR 66.2 billion) at the end of March, according to data published by Romania’s National Bank (BNR). The total public debt is now 44 percent of the gross domestic product (GDP).

Since end-March 2008, Romania’s consolidated public debt increased by RON 212 billion (some EUR 48 billion), a 3.6 times growth. This means that Romania borrowed EUR 48 billion in the last six years, or an average of EUR 8 billion a year.

Romania’s public bond issues outstanding reached EUR 37.3 billion at end-March 2014, an increase of EUR 3.1 billion compared to the December 2013. Public long term loans decreased by EUR 785 million to EUR 17.3 billion.

Compared to March 2008, public bonds issues outstanding increased almost eightfold and public loans were up 2.5 times. The largest part of the loans are money taken by Romania from the International Monetary Fund (IMF), the European Commission (CE) and from World Bank, as part of the loan agreement in 2009. The main public bond holders are Romanian pension funds, investment funds, insurance companies and banks, but also foreign investment funds who have increased their Romanian bond purchases since the beginning of 2013.

Public administration financial assets increased by 5.8 percent in the first quarter, to RON 166.5 billion (EUR 37.7 billion), or 25.1 percent of GDP. The state had record liquidities (cash plus deposits) of more than RON 50 billion (EUR 11.5 billion), 38 percent higher than at the end of 2013. Shares held by the state and other public authorities were valued at EUR 15 billion.

Andrei Chirileasa, andrei@romania-insider.com