Finance Ministry Releases 2025 Budget Draft with 2.5% Economic Growth Projection

The Finance Ministry has unveiled its 2025 budget draft, forecasting a 2.5% economic growth rate and a GDP of 1,912 billion lei. The budget is based on an estimated annual inflation rate of 4.4% and a deficit of 7.04% of GDP, CE Report quotes Agerpres

Projected revenues stand at 667.5 billion lei (34.9% of GDP), with major contributions from social insurance (30.8%), VAT (20.4%), and EU funds (13.1%). Expenditures are expected to reach 802.2 billion lei (41.9% of GDP), with social assistance (30.2%), personnel costs (21.1%), and investments (18.7%) being key spending areas. Investment spending is set at 149.7 billion lei, supported by the Recovery and Resilience Mechanism.

The macroeconomic outlook anticipates a gradual recovery in industry (0.5% growth), strong expansion in construction (4.8%), and steady growth in services (2.5%). Agriculture is projected to grow by 3.9%, though it won’t fully recover from last year’s decline.

On the demand side, investment activity will accelerate, with gross fixed capital formation growing by 5.9%. Private consumption is expected to slow in line with GDP growth due to fiscal constraints on wages and pensions. Net exports are set to improve, with exports growing by 2.3% and imports by 3.8%. The current account deficit is projected at 7.4% of GDP.

The labor market is forecast to expand by over 63,000 jobs, reaching 5.475 million employees, with unemployment at 3.1%. Wage growth will slow significantly from 14.4% in 2024 to 6.1% in 2025.