Page 148 - SE Outlook Regions 2023

The planning for 2023 and the medium-term strategy for the period
2024-2025 envisage fiscal consolidation “through a sustainable and
balanced effort, which does not impair the government’s capacity to
support the economy and promote investments”, including moderate
growth of the current expenditure on the one hand and relentless efforts
to improve revenue collection on the other, the document reads.

The volume of public investments is planned at 7.22% of GDP in 2023,
to reach 7.7% of GDP in 2026 compared to around 5% of GDP in
2020-2021 and an estimated value of 6.24% this year.

Romania’s public debt, measured based on the EU’s methodology
(Maastricht debt), rose to RON651bn (€132.6bn) at the end of October
and the ytd rise in the stock of public debt reached €15.1bn or €15.9bn
including the effects of the exchange rate variation.

Net borrowing in the first ten months of the year thus exceeded the
figure for the whole of 2021 (€14bn including the effects of the
exchange rate variation, €15.6bn not including the XR effects).

And yet, the debt-to-GDP ratio eased to 48% at the end of October,
compared to 48.8% at the end of 2021.

International rating agency S&P, maintaining Romania’s BBB-
sovereign rating as well as its stable outlook in its October country
update, estimated that the country’s public debt-to-GDP ratio will
remain under 50%: from 48.8% at the end of 2021 to 47.5% at the end
of 2022 and 46.1% at the end of the forecast cycle in 2025.

4.10 Budget and debt - Serbia

The Serbian government adopted the state budget for 2023 in
November, planning to raise revenues by about 8%.

The draft budget has both austerity and development components, and
is based on three pillars: increasing pensions and wages, more funds
for investments as well as allocation of funds for the energy sector.

The budget foresees total revenues and incomes of RSD1,843bn
(€15.7bn), which is 7.8% more than the previous year’s budget.
Tax revenues are planned at RSD1,593bn, and non-tax revenues at
RSD200.1bn.

The budget foresees GDP growth of 2.5% in 2023 with GDP of about
€68bn.

The budget still has to be approved by the parliament. Earlier in
November, Serbia’s parliament endorsed the revised 2022 state budget
with a deficit of €2.4bn.

148 SE Outlook 2023 www.intellinews.com