Private sector funding deepens foreign debt

Credits taken out by companies from abroad and placements by non-residents on the Romanian market have deepened Romania’s medium and long-term foreign debt by 5.4 billion euros, since the beginning of the year alone. Eight months into the year, medium and long term debt reached 33.87 billion euros, i.e. a 19% increase against December last year. The increase was fuelled exclusively by the private sector, while the state managed to diminish its foreign debt. Data from the NBR (National Bank of Romania) shows that direct public debt declined slightly in the first eight months of the year, to 6.93 billion euros, given that the state did not resort to foreign funding during this period. In the first eight months of the year, the NBR paid 680 million euros of the direct public debt. Publicly guaranteed debt saw a significant decline (9%) and fell to 3.4 billion euros in August, compared with 3.7 billion euros in December last year. Under the circumstances, the weight of the medium and long-term public and publicly guaranteed debt fell 30%, from 37% at the end of last year.