Wednesday, December 10, 2008

Romania's Stolojan poised to win premier nomination

BUCHAREST, Dec 10 (Reuters) - Liberal economist Theodor Stolojan appeared poised to win the nomination for Romania's prime minister on Wednesday, as his Democrat-Liberal Party held talks with rival leftists on forming a coalition.

A respected ex-World Bank expert, Stolojan, 65, would bring much-needed reform expertise at a crucial time for Romania.

ts economy is slowing and many economists say the new European Union member may slide into financial crisis next year because of its high dependence on foreign cash.

If nominated, he would face the challenge of forming a strong government able to push through unpopular spending cuts seen as necessary to insulate the economy from global crisis.

But hours ahead of the expected nomination announcement by President Traian Basescu, the centrist PD-L which narrowly won the Nov. 30 general election had yet to cobble together a convincing parliamentary majority.

Earlier this week, it appeared close to striking a deal with its arch-foes, the Social Democrats (PSD), which together with the PD-L hold some 70 percent of seats in parliament.

Such a coalition would give Romania a shot at political stability after a policy logjam since the poor state of 22 million joined the EU last year. But analysts warn its ability to tighten fiscal reins could be damaged by the PSD's expansionary policy plans.

'Among the rumoured names, Stolojan has the biggest chance to win the nomination,' said political commentator Mircea Marian.

Basescu, who has close links with the PD-L, will make a statement at 1 p.m. (1100 GMT), and may nominate a prime minister at the time.

Stolojan's PD-L is facing a dilemma in government talks, because while a partnership with the PSD could create a strong government, stability may come at the price of efforts to combat corruption, an endemic problem in Romania.

During years of rule after the bloody anti-communist revolt in 1989, the PSD was criticised for botched reforms and for allowing corruption to fester.

Several of its top politicians were investigated for graft and some were indicted but most probes were blocked by parliament as Romania struggled to enforce justice reforms.

Stolojan was Romania's second prime minister after the 1989 fall of communism. He was appointed in 1991 after his predecessor was ousted in anti-reform riots led by coalminers.

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