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Country Risk Service Romania Updater Product Image

Country Risk Service Romania Updater

  • Published: June 2014
  • Region: Romania
  • 23 Pages
  • The Economist Intelligence Unit

Public debt has risen since the crisis, but remains low at an estimated 38.4% of GDP (ESA 95 definition) at end-2013, and is not expected to rise much above 40% by 2015. Romania has exited the EU's excessive-deficit procedure (EDP) and The Economist Intelligence Unit forecasts further fiscal consolidation in 2014.

The leu may be subject to volatility as a result of political instability, tapering by the Federal Reserve (the US central bank) and a move away from emerging-market assets. Pressure on the currency may also arise from continuing euro zone turbulence or an escalation of the Ukraine-Russia crisis. Satisfactory pro-gress with the IMF stand-by programme will help to mitigate investor concern. We expect economic recovery to cause the leu to strengthen in the longer term.

A central bank probe into reporting of bad debt caused a sharp rise in the ratio of non-performing loans (NPLs) at end-2013, and this will remain high in 2014. Romania has significant exposure to Greek banks, whose liquidity and capital adequacy are high, but deleveraging is still a concern.

Country Risk Service Romania Updater

Risk assessment
Sovereign risk
Currency risk
Banking sector risk
Political risk
Economic structure risk

Definitions
Sovereign risk
Currency risk
Banking sector risk
Political risk
Economic structure risk
Overall country risk

Central scenario for 2014-18: Political stability

Central scenario for 2014-18: Election watch

Central scenario for 2014-18: International relations

Central scenario for 2014-18: Policy trends

Central scenario for 2014-18: Fiscal policy

Central scenario for 2014-18: Monetary policy

Central scenario for 2014-18: Economic growth

Central scenario for 2014-18: Inflation

Central scenario for 2014-18: Exchange rates

Central scenario for 2014-18: External sector

Key risk indicators

Ratings summary

Quarterly indicators

International assumptions summary

Economic structure

Public finances

Exchange rates, interest rates and prices

Financial sector

Current account

International liquidity

Foreign payment and liquidity indicators

External trade

External financing requirement

External debt stock

External debt service

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