Romania's economy is showing early signs of rebalancing in the first part of 2026, with the economic contraction easing, EU-funded investment accelerating, net exports making a stronger contribution, the external deficit narrowing and inflation resuming a downward trend, interim Finance Minister Alexandru Nazare said.
According to a Finance Ministry press release, the next step is to turn this stabilisation into sustainable growth.
According to the cited source, the latest data released Friday by the National Institute of Statistics indicate an improvement in Romania's economic performance in the second quarter of 2026, amid fiscal consolidation and continued efforts to correct macroeconomic imbalances accumulated in previous years.
In Q2 2026, the year-on-year contraction in real GDP eased significantly to 0.4%, while the economy remained broadly stable compared with the previous quarter. Monthly indicators also point to improving economic activity in several sectors, with construction continuing to perform well, supported in part by infrastructure projects, according to Agerpres.
Beyond short-term GDP developments, the structure of economic activity offers important signs of a rebalancing of the growth model. After a period in which economic expansion relied heavily on consumption and was accompanied by large fiscal and external deficits, investment continues to play an important role in supporting economic activity.
At the same time, net exports have made a positive contribution to economic growth since Q4 2025, as imports have grown more moderately while exports have increased. This represents a positive sign for the rebalancing of the economy, by reducing the pressure of domestic demand on imports and, consequently, on the external imbalance.
"The data from the first part of 2026 provide the first signs of this rebalancing process: the economic contraction has eased, investment financed from European funds has accelerated, the contribution of net exports has improved, the external deficit is narrowing, and inflation has resumed a downward trend. The Finance Ministry will continue to support a fiscal framework that allows imbalances to be corrected while protecting investment and projects that contribute to increasing Romania's economic potential," Alexandru Nazare said.
The Finance Ministry noted that, during the current adjustment period, investment remains one of the main factors supporting economic activity and the element that can enable the transition from stabilisation to renewed growth.
The investment cycle is visible both in the strong performance of construction and in the acceleration of EU-funded investment. In the first half of 2026, investment financed from European funds increased from 27.2 billion lei to 42.5 billion lei, a rise of 56%.
The effects of this investment effort go beyond its immediate contribution to economic activity. Investment in transport and energy infrastructure contributes over the medium and long term to increasing the economy's productive potential by reducing logistics costs, improving connectivity and strengthening energy security and availability.
Better infrastructure also creates conditions for expanding domestic production capacity, attracting private investment and further integrating Romanian companies into European production and distribution chains. Investment made during this period therefore not only supports short-term economic activity but also increases the economy's capacity to generate added value and sustainable growth in the years ahead.
At the same time, the adjustment of the external imbalance is continuing. In the first five months of 2026, the current account deficit narrowed by 5.4% compared with the same period of 2025. Over the same period, the goods trade deficit fell by 3.9%, with exports rising by 2.3% while imports recorded only marginal growth.
This reflects a gradual improvement in the balance between exports and imports and contributes to reducing pressure on the current account.
The Finance Ministry said it was also assessing this adjustment in the context of the strong investment cycle. Some investment requires imports of equipment, technology and other capital goods, which may slow the correction of the external deficit in the short term. Over the medium term, however, expanding and modernising productive capacity could boost competitiveness, replace some imports and strengthen the economy's export capacity.
Recent price developments also indicate that the disinflation process has resumed. Annual inflation fell from 10.42% in June to 8.2% in July, returning below the 10% threshold. The development is favourable, although inflation remains high and calls for continued caution in macroeconomic policy, the ministry said. Disinflation is expected to strengthen from August as the base effects associated with fiscal measures adopted last year fade.
Moderating consumption and wage growth are also helping to ease inflationary pressures. At the same time, persistent geopolitical tensions and volatility in international energy prices remain risks to this trend and call for caution when assessing the outlook.
A gradual decline in inflation is important not only for macroeconomic stability but also for economic growth prospects. As inflation falls, the gradual recovery of real incomes will create conditions for a gradual revival of consumption.
The Finance Ministry said the emerging picture is therefore one of gradual rebalancing of the Romanian economy.
Fiscal consolidation and more moderate consumption are helping to correct imbalances accumulated in previous years, while investment - particularly investment supported by European funds - is enabling continued infrastructure development and expansion of the economy's productive capacity.
"The key challenge during this adjustment period is to move towards a more sustainable growth model, based more heavily on investment, productivity and external competitiveness and less on consumption-driven expansion fuelled by the accumulation of fiscal and external imbalances. The aim of fiscal consolidation is not merely to reduce the deficit, but to create the conditions for healthier and more resilient economic growth. Productive investment, infrastructure, absorption of European funds, increased competitiveness and stronger export capacity are the elements that can support this transition," the Finance Ministry said.
"Sustainable economic growth cannot be built on stimulating consumption through ever larger public deficits, but on investment, productivity, competitiveness and a stable fiscal framework capable of supporting development without accumulating new imbalances," interim Finance Minister Alexandru Nazare said.
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