The "one-way" detractors of the European Union would probably find it instructive to make a comparison between Romania and Moldova, a neighboring and "twin" state in cultural and linguistic terms: the latter is not part of the EU and is still the most backward country on the whole continent, a large part of which (the Transnistria region), moreover, constitutes a "state within a state" and is controlled by a criminal oligarchy. The former, on the other hand, has been a member of the Union since 2007 and has since then obtained ample benefits, embarking on an interesting path towards economic and political development in the sense of consolidating democratic institutions. It therefore does not seem a coincidence that in Romania, as recent polls reported by the “Economist” reveal, the representatives of the EU institutions are more esteemed than local politicians.
The comparison is perhaps too brutal, but it effectively conveys the idea of how the EU has achieved at least some of its objectives, namely that of promoting the development of Eastern European countries which have emerged from the failed experience of Soviet socialism. Romania is still a long way from solving all its problems, yet it has significantly improved its situation having benefited from a large share of Community Development and Regional Cohesion Funds and managing to become a privileged destination for investments arriving from the West. However, as for other countries still structurally weak as they depend on the inflow of capital from abroad, Bucharest is suffering more than others from the "difficult" economic moment (to put it mildly) going through the euro zone.
After two years of recession, in 2011, GDP growth settled at a "meager" 2,3%: a figure which constitutes the sixth place in the EU but which is not sufficient for a developing country. For 2012 the estimates are further down and should settle at 1,5%. Furthermore, per capita income is the penultimate lowest in the Union, ahead only of Bulgaria with around 6 euros a year: an index of low wages (as well as a favorable tax regime) which serve to attract investments but which also reveal the clear gap that still exists between Bucharest and Brussels.
The difficulties that originated in the Euro area are also making themselves felt in Romania, as evidenced by the social protests that took place especially in the capital Bucharest during the past winter. To deal with the difficult economic situation, the executive of President Traian Basescu (in power since 2004) and Prime Minister Emil Boc had to carry out a series of austerity measures, including one tax increases and cuts in wages and other benefits to public sector workers, which were accompanied by a series of adjustment loans received from the International Monetary Fund for a total of 27 billion euros (the last recent tranche amounts to 5 billion). The protests led the Government of the Liberal Democratic Party (centre-right) to resign; new presidential elections will be held in November with the polls showing the centre-left coalition in the lead.
However, in this moment of rigid fiscal discipline (Bucharest has adhered, like almost all EU members, to the "Fiscal Compact") and of stagnation, it will be difficult for a new government structure to be able to quickly reverse the course. Certain, Romania still has the weapon of devaluation to try to restore oxygen to its economy by leveraging cost competitiveness; but in a country where wages are already very low and in a period where demand in the rest of Europe has decreased, such a measure may not have the desired effects. Furthermore, much remains to be done in terms of the fight against corruption and legal certainty: despite EU membership, progress is still limited on these fronts, as indicated by the seventy-fifth place in the Corruption Perception Index developed by Transparency International.
Having said that, what was once the easternmost European region of the Roman Empire is confirmed as an interesting destination for foreign investment by our companies. In particular, the most interested companies are those operating in labour-intensive sectors, due to the availability of low-cost labour, such as assembly and components, but even large infrastructure groups which find fertile ground here due to the funding provided by EU funds. Two examples above all: Ansaldo Breda is awaiting the outcome of a 1,5 billion euro contract for the doubling of the Cernavoda nuclear power plant, while Astaldi has recently won a 60 million contracti for the construction of a section of the Bucharest-Constanta motorway (financed, look, 85% by the Cohesion Fund).
As regards the banking sector, Romania is experiencing a moment of difficulty Since 16% of the assets issued by national credit institutions are in the hands of Greek savers. Italy is present in this sector with large groups such as UniCredit, which through Tiriac Bank is present in over two hundred branches, and Intesa San Paolo, which has just under one hundred branches for total assets amounting to approximately €1,2 billion.
What future, then, for Romania? The structural vulnerabilities of this country, linked to an economy that is not yet fully developed and to "systemic" deficiencies due to problems with respect for the law and widespread corruption, mean that the Balkan nation will be destined to suffer more than others in Eastern Europe the crisis in the euro area. A recovery of the economy in the West would in any case certainly constitute a strong "fuel" for Romanian growth, which has been able to make real giant leaps in recent years. Italy, the second commercial partner, must continue to look favorably on this market both in terms of new investments and export capacity, even if the latter is undermined by the reduction in wages which weakens domestic consumption. The sky above Bucharest, therefore, is blue but also full of clouds.
