Romania has already completed its plan of raising EUR 13 billion with FX bond issues on the foreign markets this year, but head of Treasury Stefan Nanu does not rule out new issues to refinance issues maturing next year, according to a Reuters interview.
"While we do not need another eurobond issue this year... it is possible that we will consider liability management on foreign markets. [...] There are three eurobond issues which expire next year ... worth EUR 4.25 billion (USD 4.94 billion), we might do a switch," Nanu said.
He also said that this year Romania will seek to issue samurai bonds, depending on market conditions, after last year it raised USD 225 million with the first issue of samurai green bonds.
Separately, Romania will revise its public financing needs in line with the new public deficit target: rather 8% of GDP compared to 7% initially planned, according to Agerpres. The 1% of GDP differential means some EUR 3.8 billion.
The Ministry of Finance will consequently increase the financing target for the whole year, currently at RON 231 billion (USD 53.04 billion), because the Government's initial budget deficit target of 7% of GDP is no longer valid, with Prime Minister Ilie Bolojan saying that the deficit will be "around 8% of GDP."
"We have already covered 74% of the initial financing needs for this year, and with a high foreign exchange buffer. We have flexibility and room to maneuver to adapt, once the budget review shows a higher deficit," Nanu said.
He said that Romanian retail investors could end up buying RON 45-50 billion (USD 11.48 billion) worth of bonds this year. Initially, a way to offer households a wider range of savings instruments, bonds to retail investors have become an important part of the ministry's financing strategy. The institution expects debt to reach 58.1% of GDP this year, based on the deficit target of 7% of GDP.
Nanu explained that debt will exceed 60% of GDP next year. Brussels expects Romania to reduce its deficit below 3% of GDP by 2030.
iulian@romania-insider.com
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