Sunday 4 June was the day of the first poll in Romania's local elections. Most significantly, the turnout of electors was extremely low with only 44.5 percent of those eligible taking the opportunity to cast their vote. Monitorul summed up the elections on Wednesday with the headline, "For most of the Romanians the principal right gained in December '89 isn't worth a straw." (Monitorul - 7 June 2000) As the results came in, it became clear that Ion Iliescu's Party for Social Democracy in Romania (PDSR) were ahead across the country. Even so, they achieved only 25 percent of the vote with some commentators suggesting that this level may not improve in the second ballot.
While the leading contender is the PDSR, the ruling coalition parties have had mixed fortunes. The National Christian Democratic Peasants Party (PNŢCD), the senior member of the ruling coalition, fared particularly badly. Some however cast blame for this on the National Liberal Party (PNL) who nominated candidates in their own right, not together with the PNŢCD as part of the Romanian Democratic Convention (CDR). The Democratic Party (PD), which is led by Foreign Minister Petre Roman, fared much better, as their share of the vote exceeded all expectations.
In Bucharest, Sorin Oprescu (PDSR) gained 41 percent of the vote and will face Traian Băsescu (PD) in the second ballot which is to take place on 18 June. Băsescu took 17 percent of the vote. A second ballot has to be held in all regions where no candidate gained 50 percent of the vote plus one. The two leading contenders face each other in this ballot, while the electorate are left with the opportunity to vote again. Political manoeuvring, establishing alliances and accords, will now become the order of the day in Bucharest and across the country.
Investors in the Fondul Naţional de Investiţii (FNI) unit trust, which suspended trading during the previous week, used the opportunity of the local elections to register their protest across the whole country. Many people refused to exercise their right to vote and demanded their money back whilst demonstrating outside government offices in many Romanian towns and cities. Demonstrations continued during the week, culminating in Bucharest riot police using teargas to disperse about 1000 angry investors on Wednesday.
The police investigation into the FNI collapse appears to be widening. Under investigation are the FNI administration and the president and members of the board of SOV Invest - the managing organisation of FNI. The scope of the investigation has been widened to consider the role of capital markets' regulator, CNVM, and the shareholders of SOV Invest, which include the CEC Savings Bank and has been linked to the collapse. At the beginning of this week, the private investment regulating authority removed the operating licence of SOV Invest while the government dismissed the chairman and five of the seven members of the board of the CEC Savings Bank.
The International Monetary Fund (IMF) approved the extension of Romania's stand-by loan until 28 February 2001 on Wednesday. The IMF had delayed a decision following the upheavals in the non-banking and banking sectors of the economy which recently hit Romania. However, in announcing the extension, IMF Deputy Managing Director Stanley Fischer said, "There has been a significant improvement in Romania's external position since mid-1999 in response to the strengthened policies that were introduced in order to avert a financial crisis." (Nine o'clock - 10 June 2000) Last Monday, the government wrote to the IMF setting out details on how they planned to stabilise the banking sector. They also set out a commitment not to use public funds to compensate investors following the collapse of FNI.
Romania can expect to receive the first instalment of USD 116 million within the next few days. The agreement reached with the IMF has the added bonus of releasing other loans promised by the World Bank and the European Union. Simon Mordue, of the European Commission Delegation in Bucharest, said on Thursday that the EU would release the first phase of a PHARE loan within the next two weeks. Politicians from across the political spectrum have welcomed the IMF decision. Prime Ministerial adviser Adrian Vasilescu said, "A door has opened for us and we must be ready to step inside. Now we must look into some key issues, including income policies... and especially the problems revealed by recent events on the non-banking financial market." (Reuters - 9 June 2000)
The French magistrates' investigation of Adrian Costea and his alleged money laundering took another turn at the beginning of the week. The magistrates have asked that the General Prosecutors Office instigate investigations as to whether former president Ion Iliescu benefited financially from Costea's French companies during the 1992 and 1996 elections. The French have requested the establishment of a new commission, which will hear Iliescu and PDSR treasurer Gheorghe Pascu.
Monitorul reports that the General Prosecutor has asked that Parliament suspend the immunity if the Agriculture Minister Ioan Mureşan and former Minister of Agriculture and Food Dinu Gavrilescu to enable the investigation of alleged irregularities in accounting and other procedures. This is a further blow to Mureşan, who faced a motion in the Senate on Thursday which criticised his performance as Minister of Agriculture. The motion which, submitted by PDSR, was lost by 47 votes to 45. Mureşan responded by accusing PDSR of using this debate to take the spotlight off their involvement in the Costea scandal.
On Monday, the Foreign Ministers of Romania and Bulgaria signed an agreement to strengthen border controls and to deal effectively with illegal navigation on the Danube. At the same time, they signed an accord to cooperate in the construction of road and railway bridge across the Danube which will link Calafat and Vidin. It is hoped that the agreements are seen as supportive steps as the two countries strive for membership of the European Union and the Euro-Atlantic institutions.
The General Inspectorate of Border Police (IGPF) let it be known on Tuesday that, over the previous
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A declaration has been signed by the Environment Ministers of Bulgaria, the Republic of Moldova, Romania and Ukraine agreeing to consultation and cooperation to protect the River Danube and its Delta. The Green Corridor of the Lower Danube will be developed jointly by the four countries to provide protected areas together with areas for ecological reconstruction. The representatives of the Republic of Moldova, Romania and Ukraine also signed an agreement with regard to the creation of protected areas in the Danube Delta and Lower Prut river.
- Catherine Lovatt's article on the local elections in Romania in this week's CER
- Previous News Reviews for Romania
- Archive of Catherine Lovatt's articles on Romania and Moldova
- Return to CER front page
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