There's no money for favors, says the president's advisor

In the future, Romania will have to finance economic growth not from EU funds but from domestic capital and a developed capital market, because EU transfers will no longer reach the scale that has been customary over the past twenty years. This is what Radu Burnete, economic and social advisor to President Nicușor Dan, said on Friday, November 6, at the summit of the Concordia employers' association, where he spoke much more openly.

"The state will no longer have money for who knows how many programs and subsidies," he said, adding:

"I want to tell you openly, since I still have the advantage of being a technocrat. Politicians will say there is money. There really isn't."

In his view, instruments other than bank loans will need to play a bigger role in financing businesses going forward, which requires developing the capital market. Burnete's warning came in a week when the government was forced to revise the budget precisely because of a shortfall in EU funds. In the first budget revision of the year, adopted on October 30, the government accounted for 4.58 billion lei less in EU money than expected, and more than five billion lei were withdrawn from projects financed from foreign sources with low absorption rates. The presidential advisor, speaking last May at a Senate round-table discussion while still serving as Concordia's executive director, emphasized something quite different. At the time, he said that EU funds would be crucial over the next two to three years, and that "if we don't bring home every euro, we risk a recession." There is no contradiction between the two statements: a year ago Burnete was warning that the last EU funds absolutely had to be drawn down, whereas now he is warning that no similar amount of money will follow after that.

In a March interview with Economedia, the presidential advisor explained in more detail why he considers Romania's economic problems to be structural. According to him, economic growth has been slowing for four years, falling from about four percent in 2022 to 0.6 percent in 2025, and industry has been in recession for three to four years now. "With all the tens of billions we poured into the economy, we still slowed down," he said at the time. Wages, especially in the public sector, have grown faster than productivity, while investment in digitalization, infrastructure and research and development has lagged behind; domestic production has failed to keep pace with consumption, further widening the trade deficit. According to Burnete, public debt has grown over six to seven years from about 40 percent of GDP to over 60 percent, and without a change in course it could rise to 70–80 percent, while the budget deficit may not fall below 3 percent until 2031–2032. The state is borrowing at interest rates above seven percent, which makes financing the entire economy more expensive.

"Our creditors won't let us go on living like this forever"

Burnete warned at the time.

Opinion