Romania's medium and long-term foreign debts had exceeded 17.5 billion euros by the end of 2004, an 11.9% increase since December 31, 2003 and some 58% higher than at the end of year 2000, NBR data show.
Most foreign loans were taken out by foreign companies. With state guarantees, though in particular without, these came to owe more than 7.4 billion euros, 27% more year-on-year. At the same time, public debt rose by only 2.9% over one year.
The proportion of foreign loans taken out by public entities in Romania's total foreign debt is shrinking slowly but surely and is now approaching 57%, compared with 63.4% at the beginning of last year.
Foreign financing has again become attractive and practical given the improved perception of country risk. Private companies cannot afford to wait until the costs of financing in ROL - especially in the medium and long term - come down to similar levels found for dollars and euros.
There has been a spectacular increase in the volume of loans taken out from private banks: the total rose by more than 62% and they now account for 26% of all private financing sources, 8% higher than in 2003.
In fact, the structure of the medium and long-term foreign debt in terms of creditors indicates an increase of private financing sources by around 4% to around 67% of the total. At the same time, borrowing from international bodies and bilateral loans accounted for 3% less in terms of foreign debt and 1% less compared with 2003.
The increases seen in 2004 were due to a volume of net inflows (the total difference between newly attracted amounts and repayments for older loans) of almost 2.5 billion euros, which was only slightly offset by the conversion of debts into equity (about 155 million euros).
Changes in the foreign debt structure in terms of debtors show that the proportion of public debt fell by around five percentage points, while private debt rose by a similar amount, at a time when changes in publicly guaranteed debt were negligible.
Foreign public and publicly guaranteed debt amounted to around 10 billion euros on December 31 2004, accounting for 57.1% of medium and long-term foreign debt, compared to 61.7% on December 31 2003. The non-publicly guaranteed foreign debt reached 7.5 billion euros on December 31, 2004, 25.3% higher than in late 2003. razvan.voican@zf.ro
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