Romania has experienced strong growth over the past two decades, with incomes and productivity converging toward OECD levels. According to a new OECD report, ongoing reforms are needed to improve public finances, strengthen competitiveness, and promote labor force participation, with a view to further boosting Romania’s growth prospects and standard of living.
The OECD’s economic survey of Romania projects that GDP growth will reach 1.0% this year, before rising to 2.2% next year, following 0.7% growth last year. Inflation is expected to remain high, at 6.6% in 2026, before falling to 3.0% in 2027, as the impact of previous fiscal measures fades.
“Romania has seen strong revenue growth, driven by significant increases in productivity. Looking ahead, strong fiscal discipline must remain a priority to address persistent inflation and rising spending pressures from an aging population,” said OECD Secretary-General Mathias Cormann, presenting the Report in Bucharest alongside Romanian Prime Minister Ilie Bolojan. “Stimulating innovation, skills, and digitalization will be important for strengthening competitiveness. Reforms in the areas of health, the labor market, and skills policies would facilitate higher employment rates among older workers, women, and young people.”
Improving spending efficiency remains a priority for ensuring sound public finances and supporting resilient economic growth. Continued efforts to broaden the tax base and improve tax compliance through further digitalization and risk-based audits would contribute to fiscal sustainability. Given that further consolidation efforts are needed after 2026, medium-term budgetary planning, based on performance-oriented budgeting and expenditure reviews, would help ensure fiscal discipline and the efficient allocation of public funds.
Romanian businesses need to be better integrated into global supply chains to unlock economic potential. Further efforts to simplify and digitize the regulatory frameworks for economic activities would reduce administrative costs and boost business dynamism. Improving incentives for research and development, particularly for small and medium-sized enterprises, would stimulate innovation. Investments in human capital, including through the full implementation of the comprehensive education reform and by better aligning education and vocational training with the needs of the labor market, would help increase the supply of advanced skills needed to move up the value chain.
Increasing labor force participation among older workers, women, and young people would help mitigate the demographic challenges caused by population aging and emigration. Healthy aging—through preventive care, early detection, and the promotion of healthier lifestyles—as well as lifelong learning and flexible work arrangements would boost the employability of older workers. Improving incentives for returning to work after childbirth, such as expanding childcare services and shortening parental leave, as well as new measures against workplace discrimination, would encourage women’s participation in the labor market. More effective active labor market policies, including better engagement of inactive youth and access to job-relevant vocational training, would further support youth employment.
Climate change poses a significant threat to Romania, particularly through floods and droughts. Better enforcement of regulations against construction in flood-prone areas, improvements to flood protection systems, and expanded coverage of disaster insurance would enhance resilience to flood risks. Modernizing infrastructure to prevent water losses and inefficient irrigation, along with updating wastewater treatment practices, will help address water scarcity issues.
See the Overview of the Economic Report for Romania.
The OECD is an international organization that promotes policies designed to improve the economic and social well-being of people worldwide. In collaboration with member and partner countries, the OECD provides a forum where governments can work together to share experiences and seek solutions to economic, social, and governance challenges.
The 38 member countries of the OECD are: Australia, Austria, Belgium, Canada, Chile, Colombia, Costa Rica, the Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea, Latvia, Lithuania, Luxembourg, Mexico, the Netherlands, New Zealand, Norway, Poland, Portugal, the Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Turkey, the United Kingdom, and the United States.
Romania is one of eight countries (the other seven being Argentina, Brazil, Bulgaria, Croatia, Indonesia, Peru, and Thailand) with which accession talks are currently underway. The OECD Council opened accession talks with Romania in early 2022, and on June 10, 2022, the Ministerial Council adopted the Roadmap for Romania’s accession process, setting out the terms, conditions, and process for Romania’s accession to the organization. In accordance with this roadmap, Romania has engaged in an in-depth technical dialogue with the OECD’s technical committees, composed of policymakers from each of the OECD member states, with a view to aligning Romania’s legislation, policies, and practices with the OECD’s legal instruments, best policies and practices of the OECD covering multiple areas of government policy, including economic policy, as well as social and labor market policy, education, and health.
Accession to the OECD is a transformative process that will improve the situation in Romania and for its citizens. Throughout the accession process, the OECD has worked closely with Romania to support the adoption of sustainable reforms toward this end. Romania has also played an active role in the OECD’s Regional Program for Southeast Europe since its inception in 2000, sharing policies and best practices with other economies in the region and contributing to regional policy dialogue and peer learning.