Romania won’t receive a dime from the €33 billion in aid to restart economy after pandemic

Romania has a major problem (among others). It is unable to absorb billions of euros from the EU because of the heavily politicized network of institutions in charge of managing said funds. Politicians can’t touch the EU funds with their “magic wand” (aka make the money disappear) because of strict rules: the money has to be accounted for, and those who don’t play by the rules will be punished.

That’s why the EUR 33 billion allocated to Romania from the EU Recovery Plan exists only in theory: The money won’t be absorbed by the country because it must be invested, and since the rules don’t allow for political control, it won’t be in the politicians’ interest to apply for such funding.

We just have to take a look at the country’s absorption of European funds over the past few years: Romania has a rate of 32 percent for the 2014-2020 programming period, which is way below the European average, as the Minister of European Funds Roxana Minzatu highlighted at a press conference last October.

Analyzing Romania’s performance in EU fund absorption, Cezar Petre, the president of the College of Construction Site Supervisors, has noticed a major problem: Billions of euros were allocated to the country for investment, but only 30 percent of the total were absorbed, and only a fraction of the grants awarded reached their intended destination, various investments. The rest was spent on things that won’t add value to the economy as a whole.

The majority of public investments are orchestrated through a national program called PNDL (Romanian: Programul naţional de dezvoltare locală, English: National Program for Local Development). This program is extremely politicized and used by the governing powers for their own local interest, Petre writes. On the other hand, EU funds can’t be used for such purposes because the rules are very strict. The National Anticorruption Directorate (DNA) had prosecuted politicians involved in the diversion of EU funds. Unfortunately, the DNA has been decapitated, Petre adds.

So, what does the EUR 33 billion in aid from the EU’s Recovery Plan mean for Romania? It means billions of euros exist only in theory because governing politicians won’t even try to absorb them, as they can’t use the money to their own advantage, Petre concludes.

Author: István Fekete