Fiscal Sustainability In Romania: Empirical Evidence From A Simple Debt Dynamics Model

This paper examines fiscal sustainability in Romania by combining the recent institutional context with a replicable annual regression based on public data. The descriptive section shows that Romania entered 2024-2025 with the widest budget deficit in the European Union and with a rapidly rising debt burden, while medium-term consolidation remains politically and economically demanding. The empirical section estimates a simple debtdynamics equation for annual data, where the public debt ratio is explained by its own lag and by real GDP growth. Using annual observations for 1999-2022, the model indicates strong debt persistence and a statistically significant negative association between real growth and the debt ratio. The results are consistent with the recent literature on Romania, which argues that debt sustainability depends not only on current borrowing levels but also on growth resilience, fiscal credibility, and the implementation of multiannual correction plans. The article contributes a journalstyle version of the case study by adding a real Excel-based dataset, a transparent regression output table, and a set of references that are verifiable and suitable for academic use.