Debt and deficit on the rise

The current account deficit in May exceeded the level seen in April by almost 800 million euros to reach 2.1bn euros, 71.5% higher than in the first five months of last year, according to provisional data from the National Bank of Romania. However, the rate at which the deficit is growing has fallen from 85% in the first quarter to 77% after four months into the year and 71.5% at the end of May. Trade (in FOB/FOB prices) witnessed a five-month deficit of 2.538bn euros, 934 million euros (58.2%) more than for the same period of 2004. The revenue chapter (money officially derived from those working abroad) witnessed a deficit of 624 million euros, 91 million euros higher than for the corresponding period last year. At the same time, the value of current transfers progressed by only 117 million euros since 2004 to a total of 984 million euros, but was still unable to compensate for the deficits of the other two components. NBR statistics also show that long and medium-term foreign debt reached 21.116bn euros at the end of May, an increase of 16.4% since December 31 2004. Of this, public and publicly secured foreign debt accounted for 51.5% or 10.87bn euros. The remaining 9.3bn euros account for private non-publicly secured debt. ZF