Progress in economic rebalancing, with the fiscal deficit declining and the current account deficit narrowing. Commitment to continued fiscal consolidation. Structural weaknesses in public finances, reflected in low tax collection and government arrears. Significant external debt and reliance on cross border interbank funding. Limited administrative capacity evidenced by low absorption of EU funds and high perceived levels of corruption. The ratings on Romania are constrained by Romania's comparatively low per capita GDP, developing institutions, and vulnerability to external shocks owing to its still-high, albeit declining, external debt. The ratings are supported by the government's commitment to continued fiscal consolidation as well as by the economy's potential to strengthen further by attracting foreign direct investment (FDI). Since 2009, the fiscal deficit
