The Week in Review, October 18-24
A look at the headline making events this past week
Roxana Vasile, 24.10.2026, 14:00
Romania finally has a government with full powers
As of this week, Romania finally has a government with full powers, after the last one was dismissed by Parliament on May 5 following a no confidence vote. Led by the Liberal Ilie Bolojan, the previous government, comprising the National Liberal Party, Save Romania Union and the Democratic Union of Ethnic Hungarians in Romania had served in an interim capacity for over five months. During this period, the country’s president Nicușor Dan nominated three PM candidates, tasked with building a majority and securing parliament’s approval for a new cabinet. The first nominee resigned before presenting his team and governing program to parliament, while the subsequent two failed to get the votes required for endorsement. The long-awaited outcome was finally achieved with the fourth nomination.
On Tuesday, the cabinet led by the journalist and diplomat Luca Niculescu was endorsed by Parliament with 280 votes, 47 more than the required threshold. Beyond resolving the existing deadlock, the new government has reshaped the political landscape. The Social Democratic Party, the country’s largest political force, is the sole party in the government, holding 11 ministries in the new cabinet, while the remaining 6 are headed by independents. In other words, there are now four political groups in opposition: the three former ruling parties and the nationalist AUR party. The Liberals and the Democratic Union of Ethnic Hungarians in Romania voted in favour of the Niculescu cabinet based on a political agreement reached as a temporary solution for a transitional period. USR lawmakers voted against it, while AUR abstained. As such, the current government will have to manage the country’s affairs while supported by a parliamentary minority. PM Luca Niculescu spoke of the need to improve Romanians’ living standards and to protect the vulnerable; he also promised to revive the economy and create jobs. He said the budget for the coming year is a major priority for the government, one that must meet the deficit target while at the same time supporting economic recovery and social measures.
Romania continues to have the largest deficit in the EU
Just one day after the new government was sworn in, Eurostat placed Romania at the top of the European Union in terms of its 2025 budget deficit (at 7.8%) while government debt climbed to nearly 60% of GDP. Moreover, in the second quarter of 2026, Romania reported a 9.2% deficit, after 5.5% for the first 3 months of the year. The finance ministry explained that these latest figures are adjusted seasonally and do not represent the combined deficit since the beginning of the year.
The Eurostat report immediately triggered a political storm in the country. “Romanians were afflicted with tax hikes for nothing!” the Social Democratic Party claimed. Challenging the austerity policy of former PM Ilie Bolojan, the Social Democrats had filed a no confidence motion on May 5th, a move that toppled the government in which they had previously participated.
Now back in power, the Social Democrats are reiterating their earlier criticisms: that under Ilie Bolojan’s government, Romania became the unrivalled EU leader in negative outcomes: the highest deficit, the highest inflation, the sharpest drop in consumption, and the most severe economic decline. In a final review of his term, the former PM argued the opposite, stating that he had actually reduced the deficit in both the previous and current years, while also preventing Romania from being downgraded by credit rating agencies. He acknowledged that the economy had contracted and that Romanians had consumed less, but argued that the previous growth had been toxic, as it relied exclusively on borrowed money.
Black Sea security, critical for national and Euro-Atlantic interests
On Thursday in Bucharest, the Supreme Defence Council (CSAT) discussed measures to further strengthen security in the Black Sea, defend territorial waters and critical infrastructure, and ensure the safety of merchant shipping. The meeting was convened by president Nicușor Dan following a series of attacks on merchant vessels off the coasts of Romania and Bulgaria, including within territorial waters. The attacks, blamed on Russia, resulted in casualties. Members of the CSAT emphasised that Black Sea security is a vital component of both national and Euro-Atlantic security, and that Romania will continue to act in close coordination with its allies and partners to protect its national interests and prevent escalation.
Recent developments in the Black Sea, along with concrete measures to bolster security and safeguard navigation, trade, and energy infrastructure, were also addressed in Brussels during a meeting of the North Atlantic Council. And in Strasbourg, Russia’s attacks on merchant ships off the coasts of Romania and Bulgaria took centre stage in the European Parliament session. The Parliament passed a resolution calling on the European Union to consider launching naval operations in the Black Sea. The resolution, passed by an overwhelming majority, condemns the recent attacks on civilian vessels, part of the escalating war against Ukraine.
“Reconstructing Ukraine: Security, Opportunities, Investments”
The new government in Bucharest has affirmed Romania’s commitment to becoming a logistical, economic, and strategic hub for the reconstruction of Ukraine, asserting that Romanian companies have the expertise, determination, and geographical proximity required to be part of this project. This message was conveyed during the third international conference on “Reconstructing Ukraine: Security, Opportunities, Investments,” organised in Bucharest by the think tank New Strategy Center. The organisers said Romania offers more than just a secure transit corridor; it serves as a stable platform for international companies interested in taking part in the most extensive reconstruction effort since World War II. According to a survey, Romania’s proximity to southern Ukraine, a region severely affected by the conflict, should be leveraged through major road, maritime, and rail infrastructure projects. (AMP)
