Democracy and Governance in Romania
The Development Challenge:
Economically Romania lags behind most of its neighbors in Europe that have graduated from AEEB assistance. The European Union (EU) granted Romania "functioning market economy" status with some reluctance and included several serious caveats in its 2004 report. However, significant economic growth in the past year of eight percent and the notable privatizations that have been completed, such as the huge state oil company Petrom, and two large electricity generating companies, are signs that the Romanian economy is heading in the right direction at an increased pace. Romania has concluded negotiations to join the EU, and it is committed to meeting the requirements for joining in 2007. Still, the EU is monitoring Romania closely. By 2007 Romania will need to significantly de-bureaucratize the business environment and considerably lower corruption to enable increased foreign investment, and raise the competitiveness of Romanian products. USAID plans to stay fully engage in assisting Romania through the EU accession in 2007.
The democratic transition has stalled since 1997 and there had been backsliding in several areas during 2004. The freedom and independence of the press declined as the party and government then in power continued its practice of directing advertising revenues to docile media outlets, and pressuring foreign owners of local newspapers to reduce critical coverage of the ruling party, the government, and its leadership. The government failed to investigate effectively a series of physical attacks on journalists. The virtual domination of the media by the ruling party, and the use of state funds for the political campaign by the ruling coalition had reduced the likelihood of free and fair elections.
However, the change in government in 2004, first after the local elections in June, and then after the national elections in November and December, surprised most political pundits and many in the Romanian electorate. The election of a political alliance running on a strong platform, and of a President from the democratic opposition were the most concrete signs in several years that the democratic transition is taking place and a pro-democracy electorate is prepared to turn out and to exercise its power.
The Government of Romania (GOR) passed judicial reforms at a rapid pace in order to close the EU chapter on judicial reform. However, the rapid pace has caused substantial confusion in the courts and created an atmosphere of subjective interpretation and implementation. Moreover, there were disturbing signs of politicization of the judiciary, as indicated by selective prosecutions of politically connected figures. Civic groups who have raised concerns and issues have either been ignored, or worse, threatened.
The provision of social services continues to be plagued with endemic corruption with health care particularly affected by pervasive corruption. There is much that the U.S. can do to help Romania develop better policies to reform the social sector, provided that the GOR is genuinely committed to fundamental reform, which has not been the case in past years. Reforms include the expansion of reproductive health services, increased resources for preventive health care, and improved efficiency and quality of hospital services.
(Excerpted from the 2006 Congressional Budget Justification for Romania)
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