Romania president's future hangs in the balance

By bne IntelliNews May 3, 2012

Andrew MacDowall in Belgrade -

The surprise collapse of Romania's government on April 27 has ushered in a new period of political uncertainty that could even mark the beginning of the end for President Traian Basescu.

The installation of a new cabinet in the run-up to a wave of elections in the next few months means that the country's leadership is in a state of flux. Romania badly needs economic impetus, and leadership that can reassure both the restive populace and investors.

Romania is in the midst of an International Monetary Fund (IMF) review of progress being made to meet the terms of a €5bn international loan; the fund is unlikely to look kindly on the incoming government's economic promises. It is far from apparent that any potential government can deliver government that is not only effective but popular and clean.

After the government of Prime Minister Mihai Razvan Ungureanu was defeated in a parliamentary vote of confidence, the opposition leader Victor Ponta was rapidly installed as Romania's third prime minister this year. Ungureanu had been premier for less than 80 days, having succeeded Emil Boc after the latter resigned in February following weeks of anti-government street protests. Ponta will now assemble a cabinet and present it to parliament for approval within the week. If successful, he will then take his government on to contest this year's local elections in June and a parliamentary election due by November.

The result of the vote of confidence came as something of a surprise, not least as Ungureanu's government had secured parliamentary backing when appointed in February. But his coalition, dominated by Basescu's Democratic Liberal Party (PDL), has seen support seep away as it becomes increasingly apparent that it faces devastating losses in the elections. Political parties are still fluid concepts in Romania, with fickle and opportunist parliamentarians swapping sides and an alphabet soup of parties and coalitions emerging and then waning. Indeed, the PDL itself was largely formed from defectors from other parties, including the National Liberal Party (PNL), which is now part of Ponta's Social Liberal Union (USL). "Politicians in the ruling party started to think about their own careers," Romanian columnist and blogger Dan Tapalaga tells bne. "They didn't see any expectations of success. For some time, the party has been dominated by chaos and lack of discipline. In 2008, many members joined from the PNL, and now the move is in the other direction; the PDL's own logic is being applied to it."


Both Basescu and Ponta have been swift to reassure that Romania will continue to meet its international obligations, but the coming days and months are likely to be characterised by political uncertainty. First, Porta must clear the hurdle of parliamentary approval (by no means a certainty, given the narrowness of the confidence vote). It is not clear which figures he will nominate for cabinet posts, and which parties will be represented. Then the election season begins in earnest, and it is possible that the new government will call the early elections that it demanded from its predecessors, partly in the hope of pressing home its advantage and securing a workable majority.

Basescu's future also hangs in the balance. The president has long cultivated an image as a lone wolf and has been the dominant figure in Romanian politics since he assumed the presidency in 2004 and was re-elected for a second five-year term in 2009. During the boom years of the middle of the last decade, this was to his benefit, but now he carries the can for Romania's economic crisis, stalled reform and the perception of an aloof and authoritarian government. He has very much been the focus of opprobrium both from the parliamentary opposition and the public, including those who took to the freezing streets earlier this year to demand his resignation.

Basescu robustly withstood a challenge in 2007 when an impeachment referendum called by the then-ruling coalition (much the same as Ponta's prospective government) was defeated. But, as Tapalaga points out, that was before the economic crisis and the collapse of Basescu's popularity rating to less than 15%.

But in the short term, Ponta has more important tasks than dramatically playing Brutus to Basescu's Caesar: steadying the ship of state, and preparing his coalition and Romanians for the challenges ahead. "Negotiations with the IMF and European Commission are priorities for any government," says Tapalaga.

Even if the IMF and the Commission agree to continue supporting Romania, this will be far from the end of the story. The IMF and its partners have urged the country to continue pushing ahead with economic reform, including privatisation, and to keep fiscal policy tight. Romania's expansionist fiscal stance during the boom years, particularly under the leadership of the parties now in Ponta's USL, contributed to the depth of the bust, and have been redressed by the painful austerity programme that has been a central factor in popular dissent.

But Ponta cannot please both the IMF and his own supporters, who have been promised a reversal of some of the austerity policies and a cautious approach to a privatisation programme that is already stalling. "There is a big difference between the very high expectations raised by the opposition and the need to face the international situation," Tapalaga says. "This is a big task for the new government."

Beyond the facing the realities of government, it is also far from apparent that Ponta can rid his prospective government of the whiff of corruption and incompetence that stains almost the entire Romanian political class, particularly given his pledge to bring in experienced figures. Many are concerned that he is too close to ex-president Ion Iliescu, the eminence grise of Ponta's party held responsible for corruption and repression in the 1990s.

Romania made real progress economically and politically in the last decade, but the process is now stalled. Public impressions of an atrophied political class and an economy in which many remain on the breadline are hardly baseless. Merely swapping one group of Romanian politicians for another may not be enough to effect the real change so many desire.

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