Politeía Digest

Quis custodiet ipsos custodes?

Daily News – May 17th.

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Week of massive protests kicks off nationwide

Unions are getting ready for the biggest industrial action yet, called for Wednesday, when some 40,000 people will protest in Bucharest against the government decision to cut public wages and pensions.  Mothers will gather today in front of the Labour Ministry to protest against the cabinet intention of cutting childcare leave pay.

Last week, President Basescu said cutting public expenses might not be enough to reduce the budget deficit, and other tough measures might follow.  Despite massive criticism against the cabinet, the head of state claims PM doesn’t have to step down. However if the austerity measures fail, the government will have to take responsibility.

Opposition parties voiced determination to file a no-confidence vote if government moves ahead with its plans. They accuse the president of lying and of trying to antagonise and divide social categories.  Both Social Dems and Liberals turned down Basescu’s accusations of trying to stir up social unrest with the help of unions. Pressed by the public opinion, the cabinet passed in urgent procedure, several ordinances on fighting tax evasion on Saturday. (Source: Nine O’Clock)

The President: I will reject ANI law if watered down

President Traian Basescu told a press conference Thursday evening he would turn down the National Agency of Integrity (ANI) law if he found out ‘excesses have been made’ to diminish ‘the Agency’s capacity to meet the demands for which it had been set up.

‘I won’t promulgate a law if it wasn’t what it is supposed to be, also taking into account the remarks by the Constitutional Court. If excesses have been made as to reduce ANI’s ability to meet the demands for which it was created, I assure you I will send it back,’ the president said, answering the question whether he would sign the ANI bill into law. The president made the point he is unaware if the details in the ANI law, as he actually ‘read’ nothing on the topic at hand, adding he will seek information in the upcoming period. Several NGOs Wednesday and Thursday sent letters to the president calling on him not to sign the ANI bill into law, sharply criticizing the document passed by the Senate Wednesday. The US ambassador to Bucharest, Mark Gitenstein, too sharply criticized the bill, saying that Romania’s Senate operated changes not required by the Constitutional Court,’ which will substantially and uselessly weaken ANI.

Democrat-Liberals voice growing discontent with Boc

Democrat-Liberals Sever Voinescu and Valeriu Stoica consider that the PDL government made mistakes and did not promote competent persons in leadership positions. The leader of the PDL women’s organisation asked the premier not to lower the childrearing allowance. According to informal talks that took place during the party’s Permanent Bureau meeting last week, Premier Emil Boc is now “playing his card” and if the austerity measures proposed by the government fail then elections for a new party leadership will take place.

While attending a political debate on Saturday in Sibiu, MP Voinescu admitted that “PDL governed poorly. It’s not its fault alone; it’s the fault of the other parties too. The government made a mistake when it induced the idea that the situation will be redressed by cutting pensions and callous salaries, with the people believing that their incomes will rise by making those cuts.” Voinescu warned government members that “solidarity does not mean cutting salaries, it means restructuring and layoffs and that 250,000 civil servants should be fired.” “The PNL government was a weak one for not knowing how to manage a good period and we are guilty for not knowing how to manage a difficult period. However we shouldn’t forget that both parties took over a Romania bequeathed by Ion Iliescu,” Voinescu added.

The lawmaker considers that the fact PDL members were prevented from taking part in TV debates was a costly decision because it made the population misunderstand certain measures. “One of the bad decisions taken by the PDL leadership was that of preventing party members from going on air on Antena 3 and Realitatea TV. You know why that decision was taken? If the PDL members no longer go on air those televisions will have lower ratings, they will win less from advertisements, their evil owners will go broke,” Voinescu explained. His opinion was shared by party colleague Raluca Turcan who pointed out that she disagreed with that decision. “Unfortunately, political decisions have no longer been discussed within PDL’s leadership body lately,” Turcan said.

PDL Vice President Valeriu Stoica, also present at the debate in Sibiu, criticised the current government: “Unfortunately we haven’t promoted only competent people in public offices.” He added: “We’ve built a huge lie in Romania in the last 20 years: both the left-wing and the right-win told lies in elections campaigns, knowing the promises cannot be honored. We knew that the economy cannot support those promises.”

According to talks tape-recorded by Realitatea TV last week, talks between Stoica and Foreign Affairs Minister Baconschi, the Democrat-Liberals want to postpone internal elections scheduled this July for two reasons: one has to do with the situation Romania finds itself in at this moment, and another has to do with the risk that PDL will “lose everything” if the government’s recovery plan does not work and will organise new elections six months from now, including elections for party presidency.

Democrat-Liberal women back current form of childrearing allowances

Sulfina Barbu, president of the PDL women’s organisation, asked the government on Saturday to look for solutions in order to avoid lowering the children’s allowances and the childrearing allowance. “The aid for rearing children is not an aid one can take advantage of by lying. Authorities cannot be fooled when it comes to births. Nobody can devise Romania’s long-term recovery without childrearing support offered to families,” Barbu said. Democrat-Liberal women also proposed creating, at national level, a solidarity fund to which Democrat-Liberal MPs and local representatives would donate 25 per cent of their incomes.

Opposition parties’ women organisations also reacted to the issue of childrearing allowances. PNL MP Cristina Pocora called on First Lady Maria Basescu, asking her to intervene in favor of maintaining these allowances’ current level. Pocora asked Maria Basescu to convince the Head of State to do everything he can to maintain the current level of the childrearing allowance: “I address you as a woman, mother and wife of the person that today decides, unfortunately on his own, the country’s destiny. I believe that just like the mothers or future mothers in Romania you too are sensitive to the problems that they face on a daily basis.”

According to an announcement that Andreea Vass-Paul, the premier’s economic advisor, made on Friday, the childrearing allowance will be cut by 25 per cent starting on June 1.

EBRD gets substantial means for helping fragile Eastern Europe

Approximately 60 states agreed on Friday in Zagreb to hike the capital of the European Bank for Reconstruction and Development (EBRD) by 50 per cent to EUR 30 bln, Agerpres informs. Thus, the bank has the means for helping an Eastern Europe that is in danger of being contaminated by the Greek crisis. “We have approved a capital increase of EUR 10 bln, which will significantly hike the bank’s resources,” Christine Lagarde, chairperson of the EBRD Governors’ Council, stated during a joint press conference with Thomas Mirow (photo), president of EBRD. Hiking the funds by 50 per cent would allow EBRD, which backs the economies of former communist block members, to invest EUR 8.5 – 9 bln from 2011 to 2015, after earmarking a record EUR 8 bln for this year. The strategic goals of the bank’s investments will consist of defeating the reticence to invest in the EBRD’s action areas, of investing in transport infrastructure, especially in the one located in distant areas, of supporting SMEs and of financing projects meant to cut carbon emissions.

Romania will be able to enter the euro zone when it fulfills all the criteria, EU Commissioner Olli Rehn stated during the Jacques de Larosiere Lecture that represents a traditional moment in the schedule of the Annual Meeting of the EBRD Board of Governors. According to Rehn, at this moment Romania has to face some challenges and the EU is committed to support it.

At the Annual Meeting of the EBRD Board of Governors there were calls for the regulation of capital markets, of the actors on the banking market and of the activity of international banks. Referring to the regulation of the banking sector in Romania, Radu Gratian Ghetea, president of CEC Bank and of the Romanian Association of Banks (ARB), stated that this “is not eternal; it has to change along with the market, otherwise becoming noxious.” “In Romania we had and we have good regulations, but that does not mean we shouldn’t permanently adapt them to European regulations and also to the current conditions. Ghetea stated that the emergence of the self-regulation practice is a step towards regulation, and an example in that direction is the fact that ARB came up with legislation on bank account migration and subsequently obtained BNR’s approval. Another regulation request that appeared against the backdrop of the crisis consists of separating commercial banks from the investment banks. According to Ghetea, “in Romania we’re dealing with commercial banks that developed mainly in the commercial sector and that sometimes also engage in operations characteristic of investment banks, so the need to legally separate the said entities is not yet present,” but at international level when it comes to drawing in deposits it is good to limit high-risk operations such as those commonly done by investment banks.

Treichl: Romania should create jobs and build highways “up to its ears”

When it comes to risk, Romania currently fares much better than it did 2-3 years ago and the most important thing is to create jobs and build highways “up to its ears” in the next 15 years, Andreas Treichl, general manager and president of Erste, stated at the meeting in Zagreb.

“Romania has an incredibly good position to fuel economic growth. It has access to substantial European funds and should do a dramatic catching-up in what concerns its infrastructure. Romania is a state roughly the size of France but has less than 300 kilometres of highway. So you can build highways up to your ears in the next 15 years and thus help economic growth,” the head of Erste Bank stated. 2015 is Romania’s official deadline for adopting the Euro, however at this moment Romania does not fulfill the accession criteria concerning price stability, the government’s budgetary position, the exchange rate’s stability and the interest rates’ long-term convergence, Treichl added.

Stepic: I won’t be the wise guy that tells you how to use your credits

Herbert Stepic, general manager Raiffeisen International, stated that the bank cannot decide how Romanians spend their credits, whether on expensive cars or houses, pointing out that many East European states had “a wise guy” that told them what to do during 50 years of communism. The head of Raiffeisen International pointed out that the banking sector became less attractive against the backdrop in which loans became more expensive after the crisis and there is supplementary capital demand.

Gloomy forecasts

EBRD has revised downwards its prognosis on Romania’s economic growth this year from 1.3 per cent to 0 per cent, considering the new budget deficit cut measures will limit internal demand. Thus, the international financial institution now anticipates zero growth this year and a 3 per cent growth in 2011.

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Written by Theophyle

May 17, 2010 at 10:03 am

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