Thursday, December 18, 2008

Romania coalition names cabinet to tackle economy

By Radu Marinas

BUCHAREST, Dec 18 (Reuters) - Romania's broad centre-left coalition named a cabinet on Thursday with few tested reformists to steer the poor European Union state away from recession next year.

Still absent from the line-up was a candidate for justice minister, highlighting difficulties within the governing partnership of two former arch rivals to agree who to task with reviving anti-corruption efforts, a key worry for Brussels.

Economists warn Romania could slide into recession if fiscal policy is not restrained next year and the government fails to convince markets and foreign investors that it will continue economic reforms stalled in the last two years.

Prime minister-designate Emil Boc, who won his mandate earlier this week after last month's election, pledged to follow their warnings while protecting the poorest from economic downturn.

'The key word is responsibility,' he told reporters after presenting his centrist Democrat-Liberal Party's (PD-L) nominations for a cabinet including old hands and young newcomers.

Despite Boc's reassurances, many commentators say the PD-L's coalition with the Social Democrats (PSD) will be riven by differences on how to tackle economic problems, with the leftists expected to push for costly social measures.

Already, the new government, which faces a confirmation vote in parliament on Monday, is expected to end the year with a deficit of up to 4 percent of gross domestic product, above the EU's 3-percent ceiling and the markets' comfort zone.


The proposed finance minister, Gheorghe Pogea, 52, who has been a centrist party strategist on economic issues for several years, has in the past spoken for tighter fiscal controls.

But he is likely to face opposition from PSD-nominated politicians such as Education Minister Ecaterina Andronescu, 60, a proponent of massive pay hikes for teachers, or Labour Minister Marian Sarbu, 50, once a trade union leader.

'I can see very few decent names,' said political commentator Cristian Patrasconiu.'

'What I see clearly are many people parachuted into the government by their groups of interest. This can be anything but healthy for reforms.'

New economy minister Adriean Videanu, 46, was a controversial mayor of Bucharest until June this year, and faced harsh criticism for doing little to unlock the capital's notorious traffic jams and fix its potholed roads.

But commentators welcomed the return to government of Vasile Blaga, 56, who won praise from Brussels for his work in preparing Romania's borders for EU accession when he was centrist interior minister between 2004 and 2007.

He will oversee regional development.

Senior PSD leader Cristian Diaconesu, 49, the new foreign minister, is a former judge and diplomat, popular among centrist and leftist politicians.

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