% of GDP
Soviet occupation following World War II led to the formation of a communist "peoples republic" in 1947 and the abdication of the king. The decades-long rule of President Nicolae CEAUSESCU became increasingly draconian through the 1980s. He was overthrown and executed in late 1989. Former communists dominated the government until 1996 when they were swept from power. Much economic restructuring remains to be carried out before Romania can achieve its hope of joining the
Update No: 082 - (01/03/04)
The Romanians are doing quite well, but their economy is still the poor relation among the former communist countries of Central Europe. The presidency and premiership are held by former apparatchiks in the Ceausescu regime, namely Ion Iliescu and Adrian Nastase.
Presidential election looms
Elections for the presidency are due on November 28th, some time off, but with a possibly crucial significance. The last time presidential elections were held the winner, Iliescu, was able to change the political agenda and see a like-minded government appear shortly afterwards.
The opposition can see an opportunity to turn the tables on the ruling elite and capture the commanding heights of power.
US Republican intervenes
An unusual development has taken place here. An US Republican has thrown her hat into the ring and will stand for president in November. She is of Romanian origin and of dual nationality, being both a US and a Romanian citizen.
Lia Roberts left Romania more than twenty years ago. She lives in Las Vegas and heads the Nevada Republican Party. Married to an American, she might seem an incongruous figure to stand for the presidency of a central European state.
Actually there is an interesting precedent, Valdas Adamkus, a septuagenarian Lithuanian American, who five years ago stood successfully for the presidency of Lithuania. He lost to a populist challenger, Rolandas Paksas, last year.
This might not seem an encouraging precedent after all. But in fact the Lithuanians are now mostly regretting that they voted Adamkus out and Paksas in. For he is mired in a corruption scandal, something Adamkus would never have been likely to have been.
The Central Europeans admire the Americans and regard them as the nation that won them their freedom in the Cold War. They are generally esteemed as not corrupt, not at any rate on a European scale.
Ms Roberts is basing her campaign on the need to combat corruption in Romania. If Nastase has a vulnerable side, it is that, rightly or wrongly, he is deemed to be in cahoots with dubious elements. There is a distinct chance that she can make an impression on the public and come across as Mrs Clean. That would mean victory for the Right soon afterwards, as likely as not.
The economy remains problematic
The government of Adrian Nastase appeared at first to be doing well in its second year of office. The former communist appeared in tune with the popular mood and on the figures the economy was recovering.
But it is now clear problems are abounding. The economy grew by only 4.8% last year, instead of the earlier projected 5.2%, according to Public Finance Minister Mihai Tanascescu.
The minister was optimistic that the budget deficit would be kept to 2.7% of GDP and therefore the inflation rate to 14% in 2003. But the sinister conclusion was that GDP declined by 2.4% in real terms. Hence Roberts, and the Right, are in with a real chance.
Romanian airplane manufacturer to build three IAR 99 Hawk training planes
Avioane Craiova SA will make another three IAR 99 Hawk training planes this year, State Secretary with the Economy and Trade Ministry, Decebal Ilina, said recently on a visit to the company, Rompres News Agency reported.
The management of the aircraft maker said that the price for such a plane amounts to some US$5m, five times cheaper than similar planes made abroad. Defence companies where the activity is temporarily on hold because of the lack of orders will have to limit the number of employees, the government decided at its latest meeting.
For this year, the maximum number of employees hired on labour contract cannot exceed 8,852.
Romanian oil firm won 10 percent of Bulgarian fuel market in 2003
Rompetrol company, the largest private operator in the Romanian oil industry, managed to win 10 per cent of the Bulgarian wholesale fuel market, in 2003, Rompetrol Development and Investment Vice-President, Eris Chis, said, Rompres News Agency reported
In order to enter the Bulgarian market, Rompetrol preferred to purchase a fuel-unloading terminal in the Bulgarian northern port of Ruse and upgrade it rather than open petrol stations in this country. The US$4m terminal is the distribution point to local operators.
Other directions for regional enlargement of the group in 2004 are Turkey and Macedonia. Talks are being conducted in Turkey with a local company to build an oil products terminal in the Marmara Sea. Romanian private petrol group Rompetrol is owned by businessman, Dinu Patriciu, and it yielded US$1.2bn in turnover in 2003, up 20 per cent on 2002.
Rompetrol has been targeting, over the past years, regional extension of its business in the Balkans, the extension of its fuel distribution network and a large scale upgrading of eastern Romanian refinery Petromidia.
An integrated oil group dealing in petrol extraction and production that owns two refineries - Petromidia and Vega - a network of petrol stations and wholesale fuel storehouses, Rompetrol contributed 13,783bn lei to the national budget, accounting for 4.2 per cent of budget revenues and 2.4 per cent of consolidated budget revenues.
Joint Hungarian-Romanian natural gas pipeline to be finished in 2004
By the end of 2004, companies Transgaz (Romania) and MOL RT (Hungary) will finalize the construction of a natural gas pipeline that will connect Arad (western Romania) to the Hungarian town of Szeged. The works on the Romanian soil for this pipeline are estimated at 25m euros, Rompres News Agency reported.
The pipeline represents a first phase of the NABUCCO project that refers to a new route of natural gas from Central Asia and Caspian Sea to Western European countries.
The 105 km long pipeline will carry 1.5-2bn cubic metres of natural gas a year.
The NABUCCO project was launched in the autumn of 2002 following the cooperation contract signed by the companies Botas (Turkey), Bulgargaz (Bulgaria), MOL (Hungary), OMV Erdgaz (Austria) and Transgaz (Romania). The EU has granted US$4m representing half the money for the feasibility study.
EU offers financing for nuclear safety programme
European Integration Minister, Alexandru Farcas, and chief of the European Commission Delegation in Romania, Jonathan Scheele, recently signed the financial memorandum for a new programme of EU support in the field of nuclear safety, worth 2.885m, Rompress News Agency reported.
The newly signed programme completes the 283m financing allotted by the Union to Romania late last year as support for preparing the EU entry, through the signing of four financing memoranda under the 2003 Phare programme.
Through the programme the field of nuclear safety is intended to meet the international standards of nuclear safety and includes the following projects: development of the Romanian Emergency Centre (0.4675m representing Phare financing and 0.125m representing national co-financing) of the National Commission for Control of Nuclear Activities (CNCAN); strengthening the radioactive waste-management activity (0.56m Phare) through the development of the National Agency for Radioactive Waste Management (ANDRAD); modernisation of Baita-Bihor radioactive waste storing facility (1.2m Phare and 0.3m national co-financing) and aligning the radioactive waste management at Cerna-voda nuclear power plant (0.65m Phare and 0.25m national co-financing) to the standards of the joint Convention on the safety of storing used nuclear fuel and radioactive waste. The total annual sum of the non-repayable funds given Romania under the three programmes will increase, from 660m in 2003 to more than 1bn in 2006.
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