By Radu Marinas
BUCHAREST, April 28 (Reuters) – Romania’s leftist opposition
alliance USL which has toppled the country’s two-month-old
government in a vote of confidence will unveil a new cabinet
lineup next week, its leader said on Saturday.
Like other governments in the European Union, ousted Prime
Minister Mihai Razvan Ungureanu’s cabinet has faced a wave of
public anger against plans for spending cuts and tax hikes.
His government collapsed on Friday when it lost the vote in
parliament, two months after taking office.
The collapse, which has raised the prospect of months of
political turmoil, prompted the International Monetary Fund to
postpone its review of Romania’s 5 billion euro precautionary
aid deal pending details on the shape of a new government.
Addressing supporters in the Transylvanian city of Brasov,
USL leader Victor Ponta, 39, promised to restart talks with
international lenders as soon as possible but did not elaborate
on the cabinet lineup.
“A top priority would be to meet the International Monetary
Fund delegation in Bucharest … They must see proof there is
continuity in Romania. May 7 is the most probable date for
parliament endorsement,” Ponta said.
“Our term as new government is limited until the November
parliamentary elections. We will stick to our USL programme.”
The IMF has extended two loan packages to Romania along with
the EU and the World Bank, and the precautionary deal is key to
Bucharest’s efforts to maintain investor confidence.
Ponta said his cabinet would be made of USL officials who
had been “former ministers or deputy ministers”.
Some commentators have speculated the USL, which has more
than 50 percent support in opinion polls, could roll back some
austerity measures if it took power.
Ponta told Reuters in an interview in February he would not
immediately cut value added tax to 19 percent from 24 percent if
he came to power but would aim to cut it gradually to 20 percent
by 2016 if he wins November polls.
He had said the USL would also stick with the flat 16
percent tax rate on income and profit, a change from a previous
commitment to a progressive tax policy which many businessmen
say deters investment.
The European Union’s second-poorest member slashed public
sector salaries and raised sales tax (VAT) in 2012 to put its
economy on a more solid footing but the measures have hit the
poorest as Romania emerges slowly from a two-year recession.
“They have little space for manoeuvre and cannot afford not
to stick to the IMF deal,” said independent political analyst
Cristian Patrasconiu. “It will be their first direct contact
with the real life and the economic crisis after an expected
easy win of support in parliament.”
Ponta’s rise marks a change of guard for his Social Democrat
party, founded chiefly by former communists and now still a
dominant force in the USL.
He told Reuters by telephone on Saturday he now controlled
227 seats in the 460 member parliament. The former cabinet was
defeated by the votes of 235 deputies, four more than required
to oust the government.
Several MPs from an ethnic minorities group are expected to
back the new government together with a junior grouping UNPR – a
former ally of the coalition ousted from power on Friday.
Some analysts and opponents say he remains under the
influence of its founder, Moscow-educated Ion Iliescu.
That may pose a longer term risk of shifting towards a more
leftist-minded approach including halting a process of
streamlining a bloated public sector and a cautious approach
towards much needed privatisation.
