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|  Romania
the awakening giant of Europe |
 Looking for lost prosperity - 1997 : A mixed performance - Rebuilding the Country -
Major Infrastructure Projects March On - The Tough Game - No Pain, No Gain -
The Young Wolves of the Private Sector - What's Next? 
| INTERVIEW OF
MR. PETRE ROMAN
PRESIDENT OF THE SENATE OF ROMANIA
DECEMBER 3, 1997 |
Question: I want to speak a little about your past. After the revolution what was your main directions in your politics when you were the Prime Minister?
Answer: We initiate the reform in our government, I mean the legal government that was elected in May 1990 and we made the legal frame for the political reform and for the economic reform .As an important measure I can give you an example: our government accomplished the price liberalization that was a big shock for the society that was a very necessary measure, a very courageous one .I can tell you about some laws that were the basis of the propriety transfer from state to private propriety . These political measures were stopped in 1991 when our government was eliminated. I agree with the international experts when they said that if the Romanian reform were continuing the way we started we could have been now at least at the level of our neighbors. But, unfortunately after September 1991 it was a come back of the political forces that benefited of the bureaucratic system of the former communist regime and the main reform methods the privatization the industrial restructuring was stopped. Fortunately, the elections from 1997 were a miracle because the people voted for the change, because they understood that Romania was getting further and further of the economic development trend.
Q: To come back to the 1991 -1996 period .You were in the opposition during 5 years and what has this period learned to you?
A: Mr. Iliescu party joins the parties with extremist views. So, the reformist forces couldn’t express themselves and Mr. Iliescu government was formed, generally, with the bureaucrats of the former regime and they applied what they knew. It was more easy for them to try to control everything, but actually not controlling anything, to finance broken companies as a social protection measure but what happened was a continuing decrease of the resources necessary and available for the reform. At the end of this period we had an enormous budget deficit, with two banks accused to accord illegal credits and with an industrial reform at the beginning .So, our mission was much more difficult that we expected .We had to close some companies and privatized in an accelerate speed, with all the risks , meaning the accusations of corruption .Although we had to say that this government was to slow in privatizing that is why we made some changes in the government .
Q : What are the accusations?
A : For example the bank privatization has not began yet even if the law already exists , there are some state owned companies that could already been privatized, the transforming of the state monopoly in a commercial company that can be after privatize ,in the sector of gas ,petrol , electricity . This has been done too late. The good result was the macro-stabilization, meaning the decrease and control of the inflation; this is in danger for the moment because the real economy didn’t start because there is not a private banking system and there is not a program in place for the restructuring of state monopolies.
| Q : The inheritance of the former governments is very heavy for actual government.
A : I think that the advantage of the actual coalition is the support of all the hard measures in the reform. This is the basis why we are still favorable to this coalition.
Q: The private sector is in a bad shape, I'm thinking about the SME, the liberal party has proposed a reduction in taxation level and better distributing the fiscal burden within the economy. What's the politics of the PD about this subject?
We think that we should have a more pragmatic politic in the way of flexibility because we need radiography of the state incomes. This is how we can obtain a real image. In the budget we can identify where we have to give fiscal advantages, particularly for the private sector. We are talking about the flexibility in this way, we have to stop the companies that work with loses and to take more care of the private sector .
Q: Last Friday at the Senate, you was talking about national identity as a fundamental element for a nation's development, I would like you to develop this notion according to the support of the people for the reform process.
A: I was speaking about everybody’s interest in the transition and who is against the reform doesn’t understand the future of Romania; the modernization through reform. The national identity and future of Romania is also in the international community's integration (CEE, NATO), this is also political and economical. The democracy that we are building today need the national cohesion, so every minority temptation is against vital interest of Romania.
The credibility of the government is decreased, not only because of its legal measures, which have induced social costs, but also because of the indecision's image of the government and the delaying of the reform process. The last reshuffling of the government is an answer to these accusations .We think that is a new chance to fasten the reform and the investments.
Q: What are the solutions predicted for the investments, especially the American investments?
A: Any company that decides to participate with resources in the investments must know very clearly the conditions. About the new law of privatization, we have regulations in what concern the privatization and the investments. With the experts from World Bank and from other bodies the government is about to elaborate an only law of privatization and I believe that should establish what is the action frame that is efficient, fast. We need a single law, a single institution and somebody that is already doing something in the field, someone that can obtain all the advises and approvals without delays. The law of privatization must be clear and definitive, the government must guarantee that the law won’t be change and that the inflation trend will be reasonable (around 2-3%/month). If we can guarantee all of that, I think Romania will be a dream country for foreign investors.
Q : Now, as a final question, what is your final message to them?
A: The message is that Romania will be a fashionable country, full of opportunities and the present government will use them better.
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© World INvestment NEws, 1998.
This is the electronic edition of the special country report on Romania
published in FORBES
Magazine's enriched with complementary information,
such as full interviews, detailed company files and more.
June 1 st 1998 issue
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