Romania's total external debt increased by nearly 8 billion euros in the first quarter of 2024, following a 25 billion euro increase in 2023. While borrowing was lower compared to the first quarter of last year, the government is on track to surpass 2023's borrowing pace if the current trend continues.
Key Takeaways
Total external debt reached 177.7 billion euros at the end of March 2024.
Long-term external debt increased by 6% to 129.1 billion euros.
Short-term external debt rose by 0.7% to 48.7 billion euros.
Public administration borrowing was the primary driver of the debt increase.
Debt Breakdown
Long-term debt accounts for 72.6% of total external debt.
Short-term debt represents 27.4% of total external debt.
Public Administration Borrowing
Public administration's external debt increased from 76.9 billion euros at the end of last year to 84.1 billion euros at the end of March 2024. The majority of this increase is attributed to "debt securities," which rose from 61.3 billion euros to 68.2 billion euros during the first three months of the year.
Current Account Deficit
The current account deficit for the first quarter of 2024 is comparable to the same period last year, with a slight depreciation in the trade deficit.
Long-Term Implications
The continued increase in external debt raises concerns about long-term sustainability and potential vulnerabilities to economic shocks. The government should carefully manage its borrowing needs and implement policies to promote economic growth and reduce reliance on external financing.
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Source: Ziare.com
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