ASPECTS REGARDING PUBLIC DEBT IN ROMANIA

Abstract

The public debt in Romania has experienced a spectacular increase in the last 2 years. More and more economic analysts sound the alarm and warn the government about the dangerous effects of this phenomenon on the country's economy. It will analyze the evolution and structure of public debt during 2015-June 2021, the causes of this increase and the consequences on the Romanian economy. At the same time we will study the behavior and decisions of the state leadership that led to this evolution. The paper includes 5 chapters. Introduction, in which we will define public debt and the current context related to this aspect. Here too we will refer to the motivation of approaching this analysis. The next chapter is Literature Review, in which we will present recent studies on public debt in general and public debt in Romania. Legal stipulations regarding public debt in Romania is a chapter in which the main normative acts regarding this aspect will be presented. In Database and analysis, the evolution and structure of public debt in the period 2015-2021 will be presented in figures, as well as other aspects related to the cost of public debt and the sovereign rating. The paper is based on data provided by the Ministry of Public Finance and the National Bank of Romania as well as the relevant tax legislation in Romania. Own calculations and correlations were performed based on this information. The conclusions in the last chapter are that the public debt has “exploded” in an impermissible, non-transparent and unsustainable way, without the responsible public entities clearly explaining the phenomenon. The consequences for the economy in the future are not known but can be intuited, given the status of Romania's emerging country.