On the 9 December, 2012, the Social Liberal Union (Uniunea Social Liberală, USL), the center-left alliance led by Prime Minister Victor Ponta won the Romanian parliamentary elections with a landslide victory. The official results from the electoral commission were even more convincing of the USL majority than suggested by the exit poll data. With 81.49 percent of the votes counted, the USL has 58.63 percent of votes for the Chamber of Deputies and 60.03 percent for the Senate (status at 12:00 p.m., 10 December 2012). President Traian Băsescu’s Right Romanian Alliance (ARD) got 16.69 and 16.95 percent, the Popular Party took 13.53 and 14.18 percent of votes for the two chambers respectively. The Democratic Alliance of Hungarians in Romania (UDMR) gained around 5 percent of the votes for both chambers, the rest of the votes went for smaller parties whose support are below the 5 percent ceiling.
Interestingly, President Traian Băsescu hinted before the election that he might refuse to re-appoint Mr. Ponta as Prime Minister, but with a clear majority such promises are highly unlikely to be kept. President Băsescu could nominate someone else, but his candidate would have to be approved by Parliament. The rejection of the candidate would lead to the dissolution of the Parliament. The government has threatened to move to impeach Băsescu again if he refuses to nominate Ponta. With strong support for the USL, potential clashes between the Prime Minsiter and the President could end up in a new political turmoil. Romania is the only country in the EU10 region with constant political and governmental deadlocks since 2008.
A short overview of the internal politics of Romania since 2008
In Romania after the November 2008 parliamentary elections, the government was formed by the centre-right Democratic Liberal Party (Partidul Democrat Liberal, PD-L) and the centre-left Social Democratic Party (Partidul Social Democrat, PSD). However, one year later – due to internal tensions in the coalition leading to a governmental crisis – the configuration of the structure of the Parliament has changed; the PSD became along with the National Liberal Party (Partidul National Liberal, PNL) a major opposition party. Even though the potential new Prime Minister, Liviu Negoiţă (PD-L) was mandated by the President on 6 November, 2009, Parliament did not consider the presidential proposal. As a consequence, outgoing Prime Minister Emil Boc remained in office as caretaker Prime Minister.
The Romanian government called a presidential election for 22 November, 2009, and organized the second round between the two candidates who received the highest number of votes for 6 December 2009. Thus incumbent centre-right President Traian Băsescu of the PD-L faced off with former Foreign Minister Mircea Geoană, the leader of the PSD, the run-off ended in a narrow victory by 50.33 percent in favour of Băsescu.
The PD-L did not have any parliamentary majority and the Parliament surpassed the 14-day limit for the hearing of the members of Negoiţă’s cabinet, thus extending the political deadlock in Romania and leaving Emil Boc in office as Prime Minister. On December 17, 2009, he was given a mandate by President Traian Băsescu to form a new government, afterwards receiving the vote of confidence from the parliament. At that time, a new governing coalition was formed by PD-L and the Democratic Alliance of Hungarians in Romania with the support of other national minorities and independent MPs. The government formation by Boc could be considered as an end to the political crisis. During the spring of 2010, a new party, the National Union for the Progress of Romania (Uniunea Naţională pentru Progresul României, UNPR) was born, it was formed by a group of independents who left the Social Democratic Party. Since its formation the party supported the government led by Emil Boc.
Romania suffered a severe recession in 2009; gross domestic product shrunk by 6.6% consequently, radical fiscal consolidation was implemented with a significant improvement of the structural deficit. A new austerity budget for 2010 was approved as a first act of the Boc government. For the year 2010 the cabinet introduced austerity measures including cuts in public wages by 25 percent as well as pensions by 15 percent and a raise of VAT rates to 24 percent (up 5 percent) with the aim of reaching 1.2 billion euros additional revenue. Furthermore, the interventions were also accompanied by massive layoffs in the public sector to maintain budget balance. The implemented fiscal consolidation was one of the most extensive in the European Union that is why it is not surprising that country-wide demonstrations occurred later on. As a consequence of the demonstration on 6 February, 2012 Prime Minister Emil Boc and the entire government resigned. President Băsescu nominated Mihai Răzvan Ungureanu, previously the head of the foreign intelligence service, as Prime Minister in charge of forming a government. At the end of April 2012, the President appointed Victor Ponta, the head of the Social Democrat Party after the previous government being unseated in a no-confidence vote. The new cabinet was formed by Romania’s leftist opposition alliance, the Social-Liberal Union which gained strong public support in the local government elections in June 2012. In the meantime, there was a political clash between Mr. Ponta and Mr. Băsescu, the former installing another President temporarily. But after an invalid referendum in Romania in the end of July, Mr. Băsescu could finally remain in office.
About the future
Until the parliamentary elections, the status of the government was really uncertain. This year, after the resignation of the Boc and Ungureanu cabinet, acting Prime Minister Victor Ponta’s plagiarism scandal has been making headlines recently and following clashes between the Prime Minister and the President, the existence of democracy itself was questioned internationally. With the current constellation of the politics in Romania, the centre-left coalition will be forced to share power with Băsescu, whose term runs until 2014. It could easily lead to political deadlocks in the future as well.
According to data from the Romanian Statistical Agency (INS), the Romanian economy has expanded only by slight 0.2 percent since January 2012. The slump was triggered by a 29.8-percent drop in agricultural output on a 12-month basis as a consequence of the drought this year. Growth projection has been adjusted for 2012 to 0.7 percent down from 1.7 percent. For 2013, Romanian authorities and the IMF expect growth to stand at 2.0 percent. Romanian and international institutions have recently downgraded forecasts for Romania’s GDP growth, and persistent political turmoil could have further negative effect on economic performance.
The global economic crisis triggered severe recession in Romania and after the successfully introduced fiscal consolidation measures it is a challenge for the new government not to diverge from the general policy direction of the former governments. Romania has been enjoying a relatively fast recovery as a consequence of the implemented austerity measures, that is why it is of utmost importance to walk further on the same path.
More information on the Romania’s and other EU10 countries’ positions and implications for EU policy-making available at: Vida Krisztina (ed.) (2012): Strategic issues for the EU10 countries: Main positions and implications for EU policy-making. Budapest: Research Centre for Economics and Regional Studies of the Hungarian Academy of Sciences, 322 p.