Changes in power took place at the end of 2019 and again following the 2020 elections when a three-party coalition cabinet was negotiated relatively quickly. It formed around the center-right Liberals, and a president of the same party was elected for a second term. The parliament, however, remained in the hands of the opposition until the end of the year.

As a result of the COVID-19 pandemic, Romania’s budget deficit reached unprecedented levels, and public debt increased correspondingly. The full impact of the crisis was alleviated with public spending, which kept unemployment low. The main concerns relate to several structural weaknesses, such as the regional and urban/rural disparities and the high share of the gray, untaxed sectors of the economy, which keeps the total tax revenues below 30% of the GDP, the lowest level in the European Union.

The COVID-19 pandemic exposed serious weaknesses in the education and public health care systems. Suboptimal spending and outright rent-seeking have continued, and the public procurement process continues to be affected by corruption.

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