Romania Insider
Analysts say Romanian Govt’s Economic Relaunch Plan brings nothing new

The EUR 100 billion Economic Relaunch Plan unveiled by the Government on July 1 was not negotiated with the social partners (not to mention the other political parties); therefore, it is more of an electoral program, according to analysts polled by Hotnews.ro.

Secondly, it doesn't bring many new ideas compared to the projects already on local parties' agendas - it is an amalgamation of distinct projects collected from the ministries. And thirdly, the economic dimension is weak as it envisages no budgetary reforms but full reliance on European funds.

Furthermore, it doesn't mention any reforms aimed at streamlining the EU fund absorption process (second-weakest in Europe).

"They put together all the projects that exist in each ministry and assembled them in this development plan. Some are very concrete with great chances of achievement. Most of them are just wishes. It is possible to build three regional hospitals in 10 years, but all those massive investments in transport and energy infrastructure are just "threats" that we receive from each Government," said business adviser Petrisor Peiu.

It is unrealistic to assume that Romania will receive EUR 53 bln European funds for transport infrastructure alone, he argued.

"It's a good electoral program," Peiu concluded.

Laurian Lungu, a non-affiliated economist, working as a business adviser as well, says that the directions seem to be the right ones, "even if, for example, the money allocated for decarbonization projects, or those that support green energy - so those that are supported by the EC by the green deal - as a total share, are small". But a new institutional structure capable of absorbing these funds is needed, he points out [and the Relaunch Program mentions nothing about institutional reforms].

 "I find it difficult to make a change of such magnitude overnight," Lungu commented.

Separately, he points out to the continuity issue: it takes several Governments to accomplish this plan.

"It seems to me that such a plan needs the political support of all parties. If I were a politician, I would have sought to support all parties and then come up with such a plan," he commented.

"You can make such investments if you have a very well-developed plan and political cohesion. It would help if you also had credibility. I think it will be difficult to see all these changes overnight. It will be tough to put them into practice so quickly," said Lungu.

A third independent analyst, Dragos Cabat, says that the plan outlined by the Government is slightly "theoretical" [a way of saying "not pragmatic"], it is designed for a very long term, "but it's OK". The plan brings nothing new, he implied.

"There are things [outlined in the Plan] that had to be done for 30 years," he says. "The projects are the same. We know that the road infrastructure must be improved, that the hospitals must be modernized because they are the same from Ceausescu's time, everyone knows about the energy infrastructure, which has big problems. Trust depends on politicians, on political will," explained Cabat.

[email protected]

(Photo source: Wanida Prapan/Dreamstime.com)

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Romania Insider
Analysts say Romanian Govt’s Economic Relaunch Plan brings nothing new

The EUR 100 billion Economic Relaunch Plan unveiled by the Government on July 1 was not negotiated with the social partners (not to mention the other political parties); therefore, it is more of an electoral program, according to analysts polled by Hotnews.ro.

Secondly, it doesn't bring many new ideas compared to the projects already on local parties' agendas - it is an amalgamation of distinct projects collected from the ministries. And thirdly, the economic dimension is weak as it envisages no budgetary reforms but full reliance on European funds.

Furthermore, it doesn't mention any reforms aimed at streamlining the EU fund absorption process (second-weakest in Europe).

"They put together all the projects that exist in each ministry and assembled them in this development plan. Some are very concrete with great chances of achievement. Most of them are just wishes. It is possible to build three regional hospitals in 10 years, but all those massive investments in transport and energy infrastructure are just "threats" that we receive from each Government," said business adviser Petrisor Peiu.

It is unrealistic to assume that Romania will receive EUR 53 bln European funds for transport infrastructure alone, he argued.

"It's a good electoral program," Peiu concluded.

Laurian Lungu, a non-affiliated economist, working as a business adviser as well, says that the directions seem to be the right ones, "even if, for example, the money allocated for decarbonization projects, or those that support green energy - so those that are supported by the EC by the green deal - as a total share, are small". But a new institutional structure capable of absorbing these funds is needed, he points out [and the Relaunch Program mentions nothing about institutional reforms].

 "I find it difficult to make a change of such magnitude overnight," Lungu commented.

Separately, he points out to the continuity issue: it takes several Governments to accomplish this plan.

"It seems to me that such a plan needs the political support of all parties. If I were a politician, I would have sought to support all parties and then come up with such a plan," he commented.

"You can make such investments if you have a very well-developed plan and political cohesion. It would help if you also had credibility. I think it will be difficult to see all these changes overnight. It will be tough to put them into practice so quickly," said Lungu.

A third independent analyst, Dragos Cabat, says that the plan outlined by the Government is slightly "theoretical" [a way of saying "not pragmatic"], it is designed for a very long term, "but it's OK". The plan brings nothing new, he implied.

"There are things [outlined in the Plan] that had to be done for 30 years," he says. "The projects are the same. We know that the road infrastructure must be improved, that the hospitals must be modernized because they are the same from Ceausescu's time, everyone knows about the energy infrastructure, which has big problems. Trust depends on politicians, on political will," explained Cabat.

[email protected]

(Photo source: Wanida Prapan/Dreamstime.com)

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