Romania’s external debt at end-January falls to lowest level in 5 years

Romania’s external debt, which includes both state’s loans from abroad and debts of private entities, decreased in the first month of this year with EUR 1.2 billion, or 1.3 percent, compared with end-2015, up to EUR 89.7 billion, the minimum level of the last five years and three months, National Bank of Romania (BNR) informs on Tuesday. Late last year, Romania’s total external debt was EUR 90.9 billion.

Short-term external debt at end-January amounted to EUR 19,766 million (22 percent of total external debt), down 0.4 percent against end-2015.

Long-term external debt at end-January 2016 stood at EUR 69,944 million (78 percent of total external debt), down 1.6 percent from end-2015.

In the period under review, total external debt declined by EUR 1,186 million, of which public debt by EUR 328 million, the monetary authority’s debt by EUR 311 million and non-publicly guaranteed debt by EUR 547 million.

Long-term external debt service ratio ran at 41.1 percent in January 2016 against 35.4 percent in 2015. At end-January 2016, goods and services import cover stood at 7.5 months, as compared with 6.4 months at end-2015.

At end-January, the ratio BNR’s foreign exchange reserves to short-term external debt by remaining maturity came in at 97.8 percent, as compared with 98 percent at end-2015.

A so low level of Romania’s foreign debt has no longer been registered since October 2010 when the level was EUR 89.4 billion. Since then, the debt grew strongly until March 2013 when Romania has registered the historic high level of external debt of EUR 101.1 billion. Then, Romania’s external debt came back on a downward slope and decreased by almost EUR 11 billion in the last three years, according central bank data.

At the same time, in January 2016, the balance-of-payments current account posted a surplus of EUR 168 million, as compared with EUR 311 million in January 2015.

The secondary income balance and the services balance recorded higher surpluses (by EUR 173 million and EUR 57 million, respectively), while the goods balance registered an increase of the deficit by EUR 196 million and the primary income balance saw its surplus turning to a deficit.

Non-residents’ direct investment in Romania (estimates) totalled EUR 286 million, of which equity (including estimated net reinvestment of earnings) amounted to EUR 151 million and intercompany lending to EUR 135 million.