"The pencil's eraser is small."

Translation: Guma de șters a creionului este mică.

[pereskia]

Why is there an 'a' in this sentence?

[MaartenStaa]

It's because the word immediately preceding creionului (in other words, the declined word) is not articulated. When this happens, you need to insert a word to indicate the possessive, conforming the gender of the noun:

feminine = a
masculine = al
feminine plural = ale
masculine plural = ai

Since "guma" is feminine, "a" is used. Another example:

Gumele de șters ale creioanelor sunt mici. (The pencils' erasers are small)

[--Narcisz--]

Because that means that the pencil's eraser is small, it's a possessive prefix.