European Commission Report on Romania
The European Commission acknowledges Romania’s progress in the excessive deficit procedure but warns that imbalances remain.
Mihai Pelin, 04.06.2026, 14:00
The European Commission notes that Romania, along with eight other countries, has taken effective measures to correct its excessive deficit. Brussels has adopted the Spring Package of the 2026 European Semester and considers that all the Member States in question have satisfactorily fulfilled their commitments. According to the European Commission, Romania is on a sound path of reducing imbalances, but has not yet passed the critical point, and its future depends strictly on the continuation of measures and reforms. Romania still has the highest deficit in the Union, although it has reduced it by 1.4% in one year, from 9.3%, and for 2026 it will fall to 6.2%. It is also the only country with excessive macroeconomic imbalances and has the lowest VAT collection rates, corporate income tax, and personal income tax. The National Recovery and Resilience Plan (PNRR) is considered essential, and here we are talking not only about the funds attracted and the investments made, but also about the long-term gains that come from reforms.
A key issue is pension and salary reform, as well as control over public spending in general. Typically, the Commission does not address this report from a political perspective, but in Romania’s case, it states that political instability casts uncertainty over the country’s trajectory. The greatest risk is that fiscal adjustment will be compromised, in other words, whichever government comes to power should maintain the balancing policies. The Commission’s report also contains a section focused strictly on the social sphere in Romania—given that human capital is crucial for economic growth, and, ultimately, healthy economic growth should be reflected throughout society; however, the social situation mirrors the economic and fiscal one. While the EU average shows a risk of poverty and social exclusion of approximately 21%, Romania consistently stands at over 32%, one of the highest rates in the EU. The effectiveness of social transfers remains low. While, in the EU, social assistance reduces the risk of poverty by nearly 33%, in Romania the impact is less than 20%.
The Commission makes it clear that the social protection system needs to be overhauled, as it does not provide sufficient coverage for vulnerable people, particularly in rural areas, where over 45% of Romanians live. Education also remains a critical issue. Romania has one of the highest rates of functional illiteracy in the EU: over 40% of students do not meet minimum proficiency levels in reading and math, compared to the European average of approximately 25%. In terms of social and environmental infrastructure, Romania is once again among the countries with significant gaps. Nearly a quarter of households are not connected to modern water and sewerage networks, and infrastructure investments are concentrated in just a few regions. The Commission emphasizes that Romania must accelerate investments in environmental infrastructure and basic public services to reduce regional disparities. (LS)
