In a period marked by economic uncertainty, regulatory change and technological disruption, staying ahead of key trends is essential. This edition provides a concise overview of the developments shaping Romania’s business landscape, complemented by the latest PwC insights on AI, talent and consumer behavior. We hope it will help you navigate risk, spot opportunities and make informed decisions. Happy reading.
Romania’s macroeconomic context in grades, grants and gauges
August is usually the quietest month in the business calendar, but not for Romania’s public finances. While many of us were away, the rating agencies were at work, and against a challenging backdrop, Fitch’s and Moody’s decisions to affirm Romania’s investment grade is a victory in itself.
Political uncertainty and the absence of a fully mandated government remain genuine risks to fiscal adjustment and to the absorption of EU funds. Yet, the underlying numbers point to fundamentals that are slowly improving, with the deficit narrowing faster than many expected. That does not make the risks disappear, but it gives us more room to plan than the front pages suggest. We encourage companies to stay informed and assess how economic and policy developments may impact their plans in the months ahead.
The season of scrutiny. Fitch and Moody’s affirmed Romania’s Long-Term IDRs at ‘BBB-‘ with a Negative Outlook, underpinned by EU membership, above-peer GDP per capita and governance quality, but balanced against large and persistent fiscal and current account deficits, rising government debt/GDP, high inflation and increasingly fragmented and polarised domestic politics.
The deficit numbers behave. Romania’s deficit was at 2% of GDP over January – June, compared to 3.6% of GDP over the same period of 2025. Considering this trend, there are chances to decrease the budget deficit even below the 6.2% of GDP assumed target. This is good news for the economic perspective of the country.
Romania’s tax revenues-to-GDP ratio – low but rising
Part of the case Romania is making to the agencies rests on its improving revenue base. While still one of the EU’s lowest-tax economies, with a tax-to-GDP ratio of just 27.9% in 2024, Romania recorded a 15.5% rise in nominal tax revenues that year, one of the fastest increases in the Union, according to the European Commission’s Annual Tax Report.
Driven by the consolidation packages adopted in 2025 and early 2026, from the VAT overhaul to reforms of income, corporate, environmental and property taxes, the EC report expects the growth ratio to climb to 29.4% by 2027.
Inflation downtrend. Prices rose 10.4% in the year to June, down from May’s 10.9%. The culprits were non-food components (especially fuel courtesy of the Middle East conflict) and services, while food inflation eased markedly to 5.8%. This seems the first decline of an expected inflationary pressures ease in the following period, as base effects from last year’s measures (VAT increase and electricity price cap removal) should pull the headline down from August. The central bank, unmoved, is holding rates until the trend is unambiguous.
Production prices rising. According to Romania’s National Institute of Statistics (INS), industrial producer prices rose by 12.7% in June 2026 compared with a year earlier, with a steeper increase of 14.3% on the domestic market. The sharpest rises were in energy-related activities: 41.9% for coke and refined petroleum products and 23.3% for electricity, thermal energy and gas, bringing the energy industry group as a whole to 24.5%, roughly twice the industrial average.
The challenge of the structural story. Step back from the quarter, and a challenge comes into focus. Manufacturing’s share of Romania’s gross value added (GVA) has fallen from 23% in 2015 to roughly 15% in 2024, the largest decline (-8.4 percentage points) among all EU member states. The causes are structural based on wages that outran productivity year after year, industrial energy costs among Europe’s least competitive, and a growth model that rewarded consumption and imports over production and exports. The consequences are visible in the twin deficits of a country that makes less of what it consumes and must borrow to buy it abroad.
The tradable sector that must eventually pay Romania’s external bills is shrinking precisely when it is needed most.
The regions and workers tied to industry, representing nearly a quarter of employees, face an adjustment that services, however dynamic, will not absorb evenly. As for the next investment cycle, it offers a rare chance to lean against the trend with EU-funded energy and grid modernisation, the defence-industrial expansion under way across Europe, and AI and digitalisation all favour countries that can still make things and Romania, unlike some richer neighbours, still can.
Whether the coming decade extends the decline or reverses it will depend less on any single budget than on energy costs, skills and predictability.
Growth remains uneven across regions.
Meanwhile, PwC’s Global Economy Watch projections point to global growth of 2.4% in 2026 at market exchange rates, with inflation easing to 3.4% this year and 2.7% in 2027. Growth remains uneven across regions: the Eurozone is expected to expand by just 0.9% in 2026, well behind the United States at 2.1% and emerging markets at 4.0%, while the Federal Reserve, the European Central Bank and the Bank of England are all expected to make limited changes to interest rates over the next six months. PwC notes that these projections do not yet factor in the recent geopolitical unrest in the Middle East, and recommends companies test a range of alternative scenarios.
OECD Recommendations: From Isolated Reforms to an Integrated Framework
In the context of Romania’s anticipated accession to the OECD, the organization has issued a report on business licensing and permitting that includes a series of important recommendations for public authorities. If effectively implemented, these measures could significantly improve the business environment, reduce administrative burdens, and strengthen Romania’s attractiveness for investment.
The report’s central message is that Romania needs to move beyond sector-specific reforms and adopt an integrated approach to business licensing and permitting. To this end, the OECD proposes a structured agenda built around five key priorities:
- Extending the principles of the Single Industrial Licensing Law to the trade and services sectors, where regulatory fragmentation remains significant;
- Integrating currently dispersed procedures into a unified framework, supported by simplified processes and stronger coordination among public authorities;
- Developing a single, user-friendly digital portal through which businesses can understand their obligations and manage as much of the licensing process online as possible;
- Introducing a risk-based approach, allowing lower-risk activities to benefit from streamlined procedures without compromising public standards and protections;
- Reviewing licensing fees to ensure they are transparent and appropriately aligned with the actual administrative costs incurred by public authorities.
The OECD assesses that implementing these reforms could increase Romania’s potential GDP by approximately 0.6% after 10 years, 0.8% after 25 years, and 1.1% over the long term. These figures suggest that business licensing reform can become a meaningful lever for enhancing Romania’s competitiveness.
Beyond the quarterly agenda, real opportunities are opening for business, and none is larger than the technology reshaping how value is created.
Energy cost and AI, the hot topics on the CEOs’ agendas
PwC’s 2026 CEO Survey Mid-Year Snapshot shows that energy costs have become the biggest financial surprise for CEOs in 2026, outpacing every other cost pressure since the start of the year. Even so, CEOs are maintaining confidence in their companies’ growth prospects despite a business environment marked by geopolitical disruption and more complex strategic decision-making. Romanian companies went through the price shock last year, when electricity prices posted the sharpest increase in the European Union after the government removed the price-capping scheme, only to face rising fuel prices in the first half of 2026, pushing production costs higher and putting further pressure on competitiveness.
PwC’s 2026 AI Jobs Barometer shows that AI has become a driver of productivity, wages and competitive advantage rather than a mere automation tool: the most AI-exposed companies have delivered 163% labour productivity growth since 2018 while expanding headcount, workers with AI skills earn a 62% wage premium, and specialist AI jobs are growing eight times faster than the broader labour market. The strongest gains go to „professionalised” roles where AI amplifies expert judgement, a finding especially relevant for Romania, where businesses can move up the value chain by pairing strong technical capability with higher-value expertise.
PwC Voice of the Consumer 2026: Health and wellness now shape everyday decisions
Technology is changing how companies work; consumers are changing what they ask of them.
Nearly one in every eight dollars spent globally now goes to health and wellness, driven by the desire for a longer life, lower stress and better sleep rather than by medical problems, according to PwC’s Voice of the Consumer 2026 survey of 21,808 consumers in 27 countries, including Romania and with the global wellness market set to grow from USD 6.8 trillion in 2024 to USD 9.8 trillion by 2029, this increasingly proactive consumer is asking pharma, healthcare, retail and FMCG companies to simplify their health decisions.
Takeaway
Romania has a quarter of falling output and rising political entropy and yet the deficit is shrinking on schedule, bond markets are calm, and inflation has likely peaked. The next ninety days spanning two rating verdicts, the PNRR deadline will determine the medium term economic perspective.
