This adds to the nearly 29 billion lei (around EUR7 billion) taken out in lei from local banks, making up a total of EUR11.5 billion in loans taken out in less than six months.
A big share of the money, including the five-year EUR1.5 billion medium-term note issue is aimed at rollover older debt. In the second half of July, the Finance Ministry has to cover a nearly EUR2.5 billion repayment spike. Loans from the local market will also be used to help repay the debt, with a new issue announced for the second half of the year.
Aside from having to repay maturing loans, the public debt continues to climb. In March it had reached an all-time high at RON199 billion, or 37% of GDP.
This year, the International Monetary Fund asked authorities to resort more to the foreign private market in order to finance the budget deficit and the public debt. Although the Finance Ministry has just raised EUR1.5 billion and could go to the international markets seeking at least EUR1 billion in autumn, it will continue to put pressure on the local market, and is likely to borrow around RON4 billion per month.