Strong growth prospects. Much reduced budget deficit and moderate general government debt. Progress on the structural reform agenda. Continued 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 low prosperity and the economy's vulnerability to external shocks owing to still-high, albeit declining, external debt and dominant ownership of the banking sector by Austrian and Greek parent banks. The ratings are supported by the country's improving fundamentals; the fiscal deficit is declining, the current account deficit has narrowed, and the economy has started to
