Friday, August 29, 2014

Romania allows local party-swapping, critics see threat to democracy

Thu Aug 28, 2014

(Reuters) - Romania's government approved a temporary emergency ordinance on Thursday to let local administrations change political affiliations in a pre-election move it says will unblock policymaking but which critics say threatens democracy.

The ordinance gives local mayors and councilmen in the European Union state 45 days to choose to join a party other than the one from which they were elected in office without losing their seat, as was the case previously.

Romania will hold a presidential election on Nov. 2 and Prime Minister Victor Ponta of the leftist Social Democrat Party (PSD) is widely tipped to win it.

Centre-right opposition parties opposed the ordinance, which circumvents parliament and takes force immediately, as they fear it may spur defections from their ranks to the PSD, boosting Ponta's electoral position.

"We are concerned with its timing," the U.S. Embassy said in a statement, referring to the ordinance. "We have in the past expressed concerns about legislating complex issues via emergency ordinances."

Ponta's government has said the ordinance aims to streamline policymaking after changes to central political alliances this year caused rifts in local councils, freezing investment projects that tap into EU development funds.

A study by Romania's Institute for Public Policy think-tank found that over 80 percent of local administrations have rejected public investment projects or failed to meet the quorum for votes in the last three months.

But the Institute criticized the ordinance for bypassing active legislation, threatening the rule of law in Romania, one of the EU's poorest and most corruption-ridden countries, along with neighboring Bulgaria.

"The impact ... is devastating for the rules of a democratic state. Does the government intend to pass ordinances that suspend for a certain period of time the obligation to respect speed restrictions when driving, or to pay taxes?" it said.

"We ask ... parties to be responsible and solve local councils' disagreements politically, not through the law."

The Liberal Party, formerly in coalition with the PSD, split away at the start of this year and are now allied with the opposition centre-right Democrat Liberals. The PSD has formed a new majority together with the ethnic Hungarian Party and two other smaller groupings.

In 2012, Ponta drew a severe rebuke from the European Union over his efforts to ensure President Traian Basescu, a political rival, was impeached in a national referendum, a dispute that raised concerns over the rule of law.

Romania's next president will play a pivotal role in appointing a new prime minister and a government line-up to oversee IMF-backed reforms under the standby 4 billion euro aid deal it secured last year.

(Reporting by Luiza Ilie; Editing by Mark Heinrich)

Monday, August 25, 2014

Romanian court frees former prime minister Nastase on parole

(Reuters) - A Romanian court ordered former prime minister Adrian Nastase be released on parole on Thursday after serving the required third of a 4-1/2-year sentence for corruption.

The 64-year-old was sent to prison in Bucharest in January for taking bribes, the highest profile of several convictions made in the impoverished country, which is under pressure from the European Union to crack down on high-level crime.

Prisoners over 60 years old in Romania can be released for good behaviour after serving just a third of any sentence shorter than 10 years, and Nastase had served time for a previous graft conviction before his latest stint in jail, which was taken into consideration by judges, the court said.

Nastase is the only premier to have been put behind bars in the Black Sea state since the collapse of communism and the execution of dictator Nicolae Ceausescu in December 1989.

The EU has repeatedly raised concerns about a failure to jail high-profile criminals in Romania and Bulgaria, the bloc's two poorest members which have been barred from the passport-free Schengen zone over the issue since their 2007 entry.

Nastase's case dates back to 2006 when prosecutors charged him and his wife with taking 630,000 euros ($860,000) in bribes.

He was accused of using his position in 2002-2004 to obtain gifts from an official at a government building works watchdog in return for helping that woman keep her job.

Nastase and his wife were also accused of illegally importing building materials and household goods from China to furnish their houses in Bucharest as well as a holiday home.

The leftist politician, a mentor to incumbent prime minister Victor Ponta, has repeatedly denied any wrongdoing and said the cases against him are politically motivated.

He shot himself in June 2012 when police came to take him away to start his first sentence. He was not seriously injured.

Emerging from the Jilava prison gates immediately after his release, Nastase told reporters: "The trials I've been through over the past years have strengthened me. I need some time ... first, I want to stay with my family."

Thursday, August 7, 2014

Romanian key reformist launches bid for presidential election

Independent Balkan News Agency
By Daniel Stroe – Bucharest

Romanian former Justice minister and current member of the European Parliament, Monica Macovei, last night officially launched her independent candidacy in this fall’s presidential elections, defying her party ranks who chose to go ahead with a different candidate.

Macovei, a member of the Democrat Liberal Party (PDL), is a well known public figure renowned for key judiciary and anti-corruption reforms passed while filling the Justice minister position in 2004-2007. She decided to go on her own in the presidential race after PDL joined forces with the National Liberal party (PNL), the main opposition party in the Romanian Parliament, and agreed on a joint candidate in November’s elections. The main contenders are Catalin Predoiu, another former Justice minister, and Klaus Iohannis, mayor of Sibiu, a city in central Romania, and the favorite to win the nomination.

“Thousands of you have called on me to run in the race for Cotroceni (the presidential palace). I am now answering and running. It hasn’t been an easy choice, but it is a challenge I assume with determination and faith” she said in a video launched last night in which she reminded Romanians of her major reforms and decisions passed while minister of Justice and Euro-lawmaker, such as help to create the National Anti-Corruption Department and contribution to a pan-European directive which stipulates confiscation of illegally obtained assets.

“Why I am running now, you may wonder. I am running because I know we can do more. We have to wish for more and know we can do more as a country. We don’t have any other chance but to ask for more in these elections. We can move forward or we can back 10 or 20 years. The choice is ours. So I decided to run and you have to decide to get involved” she added.

But her candidacy has raised some eyebrows. Speaking to B1 TV yesterday, President Traian Basescu, former head of Macovei’s party and whose second consecutive term at the helm of the country ends later this year, warned her candidacy would divide voters on the right side of the political spectrum. He acknowledged though Macovei has all the qualiti4s to make a good president. “I don’t think someone can become president in Romania running as independent” Basescu concluded.

But Macovei is likely to make a fine performance in these fall’s first round of elections, with a wave of support already active on social media among the civil society and intellectuals. Polls published so far have disconsidered her candidacy, focusing on the two likely main contenders, PM Victor Ponta and Klaus Iohannis.

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Monday, August 4, 2014

Romania Cuts Main Rate to Record on Subdued CPI Outlook

Bloomberg News
By Andra Timu
August 04, 2014

Romania cut its benchmark interest rate to a record after a five-month pause as a bumper harvest limits the risk of inflation quickening.

Policy makers lowered the rate to 3.25 percent from 3.5 percent, according to an e-mailed statement today. Five of nine economists in a Bloomberg survey predicted the move, while four saw the rate unchanged. The central bank maintained requirements for foreign-currency liabilities at 16 percent and those for leu deposits at 12 percent. Governor Mugur Isarescu will hold a briefing at 3 p.m. in Bucharest.

“Surprisingly low inflation” is behind the rate reduction, according to Vlad Muscalu, a Bucharest-based economist at ING Bank Romania. The cut may be followed by another of the same size next month, he said in an e-mailed note before the decision.

With the inflation rate at a quarter-century low and economic growth the fastest in the European Union in the first quarter, policy makers halted an easing cycle in March after 175 basis points of rate cuts since July. The bank has reassessed its inflation outlook and will present a new forecast on Aug. 6.

The leu weakened 0.1 percent to 4.4343 per euro at 12:53 p.m. in Bucharest, according to data compiled by Bloomberg. It’s strengthened 0.9 percent this year.

The central bank is seeking to keep consumer-price growth between 1.5 percent and 3.5 percent in 2014 and forecasts year-end inflation at 3.3 percent.

The rate, which fell to 0.7 percent in June, may remain below 2 percent in December because “inflationary expectations have never been lower,” Lucian Croitoru, a monetary-policy adviser to Isarescu, said last week. The National Statistics Institute will release July data on Aug. 11.

To contact the reporter on this story: Andra Timu in Bucharest at

To contact the editors responsible for this story: Balazs Penz at Andrew Langley, Agnes Lovasz

Wednesday, July 30, 2014

Romania's leftist PM launches candidacy in presidential election

(Reuters) - Romania's ruling leftist alliance endorsed Prime Minister Victor Ponta's candidacy in a Nov. 2 presidential election on Tuesday, with opinion polls showing him leading but not by enough to avoid a runoff ballot.

Ponta, 41, the leader of the leftist Social Democrat Party, came to power in May 2012 in an alliance with the Liberal Party, toppling a centre-right government that undertook painful wage cuts and tax hikes at the height of the financial crisis.

His liberal allies split from the coalition earlier this year to support their own presidential candidate. They then decided to merge with the Democrat Liberals, another centre-right opposition party.

Analysts widely believe Liberal Party head Klaus Iohannis, 55, an ethnic German mayor of the Transylvanian city of Sibiu will emerge as the right's candidate to face off with Ponta on Nov. 2.

A survey by pollster INSCOP ordered by daily Adevarul earlier this month, showed Ponta had 43.6 percent support, leading Iohannis by more than 12 points. But neither contender would garner enough votes to avoid a Nov. 16 runoff ballot.

"I am convinced that come November we will win," Ponta told thousands of party members gathered in the southern Romanian city of Craiova on Tuesday, after they had voted to back his candidacy. Ponta also visited nearby villages hit by floods this week.

"I am also convinced that my presidential mandate will resemble today, with me standing by people in trouble, with problems." Beethoven's Ode to Joy marked the ceremony.

Helped by successive IMF-backed aid deals since 2009 and by austerity policies, Romania has slowly emerged from recession to record one of the highest economic growth rates in the region.

Since 2012, Ponta's government has reversed wage cuts and undone various austerity measures. It now aims to cut a social security tax that will leave a gap in the budget, and the International Monetary Fund has postponed a review of a precautionary aid deal pending the election, which has raised concerns about fiscal discipline.

The government is also struggling to benefit from higher economic growth, with tax evasion reaching 16.2 percent of GDP last year.

Ponta, a former prosecutor and amateur motor rally driver, has been hit by calls to resign after charges of plagiarism surfaced, which he refused to do, and by the jailing of former Prime Minister Adrian Nastase, his mentor, for corruption.

In 2012, he received a severe dressing down from the European Union over his efforts to ensure President Traian Basescu, a political rival, was impeached in a national referendum, a row which raised concerns over the rule of law.

The next president will play a pivotal role in appointing a new prime minister and a government line-up to oversee IMF-backed reforms under the standby 4 billion euro aid deal it secured last year.

Romania’s online advertising to value 141 mln dollars in 2018: PwC

BUCHAREST, July 29 (Xinhua) -- The online advertising in Romania will have an annual increase of 14.6 percent in the coming four years, with its value reaching 141 million U.S. dollars in 2018, showed the latest study of the PwC Entertainment and Media Outlook.

The online advertising will therefore become the fastest growing sector in the Romanian media and entertainment market in the analyzed period.

Another segment to record a growth of the market is the payments for the Internet access, with an average annual plus of 9.9 percent, up to 1.18 billion dollars in 2018, from 841 million dollars this year.

Thus, the Internet access and the online advertising will count for over 40 percent of the country's media and entertainment market in 2018, followed at a big distance by the TV subscriptions with an estimated value of 612 million dollars in 2018.

The Romanian media and entertainment market will record an average annual increase by 5.2 percent, reaching 3.1 billion dollars until 2018, according to PwC’Global entertainment and media outlook 2014-2018.

The Romanian market, despite of its increase, will remain the smallest market in the region in terms of overall value, with 3.1 billion dollars, compared with Poland (12.6 billion dollars), Czech Republic (6.5 billion), and Hungary (3.2 billion).