Romania closed 2025 under the weight of political upheaval, efforts to manage high public deficits and subdued economic growth, even as policymakers pressed ahead with fiscal consolidation and structural reform efforts.
Political instability loomed large throughout the year. After a surprise strong showing by a far‑right candidate in the presidential election’s first round in May, Prime Minister Marcel Ciolacu resigned under pressure, triggering a realignment of political forces and the installation of a broad coalition government later in June that won a confidence vote in parliament.
Later in the year, President Nicușor Dan announced plans to investigate alleged systemic abuses within the judiciary, following complaints from hundreds of magistrates about undue influence and ethical concerns. The announcement sparked protests and sharp criticism from far‑right lawmakers, who accused Dan of undermining judicial independence and called for his impeachment.
Economically, Romania’s performance in 2025 was mixed. Growth remained modest, with official figures showing a 1.6% expansion in the third quarter, driven by construction and agriculture, although forecasts vary and some institutions project even slower performance.
Persistent inflation and fiscal strain were key challenges. Analysts earlier in the year projected inflation in excess of 6 %, while Romania continued to run one of the widest budget deficits in the EU, prompting austerity measures and fiscal consolidation plans to avoid risks to credit ratings and EU funding access.
The International Monetary Fund said Romania’s economy was expected to grow slowly, with headline inflation remaining elevated before easing toward the end of 2026, and stressed the importance of structural reforms and fiscal adjustment.
Fiscal pressures also shaped public finances: the government forecasts its gross funding needs for 2026 to rise to around 275 billion–285 billion lei ($63 billion–$65 billion), while aiming to reduce the deficit from an elevated 2025 level to around 6 %–6.5 % of output next year.
Romania’s business climate showed strains amid the turbulence. Foreign investors and local chambers of commerce voiced concerns about deteriorating investment conditions linked to political uncertainty and fiscal challenges.
On the foreign policy front, Romania remained committed to supporting Ukraine, hosting NATO units on its territory and contributing to collective defence, even as broader geopolitical pressures tested regional energy and economic ties. The country also advanced pension reforms aimed at strengthening long‑term financial sustainability and aligning with its bid to join the Organisation for Economic Cooperation and Development.
As 2026 begins, Romania faces a balancing act of stabilising its political environment, managing fiscal pressures, and encouraging sustainable growth, while pursuing structural reforms critical to its European integration and economic resilience.