Fitch has simultaneously affirmed the city’s long-term local currency rating at ‘BBB-‘ and the short-term foreign currency rating at ‘B’.
“The ratings reflect the city’s strongly rebalanced budgetary performance, which benefited from a supportive national policy framework for local governments, and its restored overall financial flexibility, despite challenging economic conditions in the local and national context,” the ratings agency said in a statement.
It said Brasov has successfully implemented cost-cutting measures that led to a leaner organizational structure and rationalization of staff costs. urther improvement of fiscal performance remains reliant on stronger tax revenue, which mainly depends on local and national economic recovery.
“Romania’s highly centralized national budgetary system ensures adequate support and control from the central government. Under the austerity measures implemented in the face of the national economic contraction, the state ensured budgetary rebalancing in local government finances through subsidies and regulatory measures, including expenditure control,” Fitch said.
Fitch has Romania rated at ‘BB+’, with stable outlook.