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Romania’s Macroeconomic Steering in 2015 - between Enthusiasm and Recession Risk

Author

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  • Cristian - Marian Barbu
  • Sorinel Capusneanu

Abstract

This article reveals that, despite having a solid macro-economic state and a significant economic growth as starting points, those who conceive the fiscalbudgetary macroeconomic policies in Romania apply more enthusiasm than principles of responsibility, prudence and sustainability. While economic growth in Romania is over 3% of the GDP, public debt of a little over 40% of the GDP, budget revenues with 7.8% bigger than during the first 9 months of the previous year, and budgetary surplus of almost 1% of the GDP after the first 8 months, the 2016 budget prospects look good. Well, they are actually not. If the Government implements the budgetary expenditure announced, the budget deficit may explode which may lead, in 2018, to exceeding the maximal critical threshold of public debt, and in this case, according to the Romanian National Bank, the recession risk will be over 50%.

Suggested Citation

  • Cristian - Marian Barbu & Sorinel Capusneanu, 2015. "Romania’s Macroeconomic Steering in 2015 - between Enthusiasm and Recession Risk," Academic Journal of Economic Studies, Faculty of Finance, Banking and Accountancy Bucharest,"Dimitrie Cantemir" Christian University Bucharest, vol. 1(4), pages 20-36, December.
    • Handle: RePEc:khe:scajes:v:1:y:2015:i:4:p:20-36
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    More about this item

    Keywords

    Macroeconomic policy; public debt; budget deficit; accountability; prudence; recession risk;
    All these keywords.

    JEL classification:

    • E60 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General

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