Daniel Daianu argues need of consolidation of EU funds absorption in letter to Barroso

Daniel Daianu, former European MP and former Finance Minister, has sent on Friday a letter to the President of the European Commission, Jose Manuel Barroso, arguing that the European Union (EU) Executive must „take over the initiative in the field of consolidation of the EU funds absorption as means of combating the economic crisis – separate from the traditional goals of consolidation of convergence and of the implementation of the Common Agricultural Policy”.

„An added increase in pre-financing, and renouncing to co-financing in case of utility being under a question mark, and in case of national importance projects must be one of the major priorities of the Commission.

The EU funds might also be needed in order to back up the local banks capital, or the creation of financial institutions dedicated to the promotion of rural modernization. In Romania such an instrument would be more than welcome, given the almost total neglect on the part of the commercial banks of agriculture”, stressed Daniel Daianu in his letter addressed to EC President.

The former Liberal MP also reminds that, at this year-start, the Commission simplified the procedures of absorption of the European funds. Yet this measure is viewed as insufficient for an economic recovery. Moreover, the programmes based on the estimations made by the international financial institutions and the European Commission did not succeed to avoid the pro-cyclical character, despite the manner they were conceived illustrated great flexibility.

„The cruel reality is that these programmes are pro-cyclical at a moment when the international markets follow a downward spiral and the private sector activity is shrinking; and this happens when the governments in many countries in the European Union, the USA and Asia use budgetary instruments and counter- cyclical monetary policies to alleviate the crisis effects”, Daniel Daianu also writes in his message addressed to Jose Manuel Barroso.

In his opinion, the EU funds can be equivalent to the active budgetary police practiced in the USA and by the big EU countries without entailing increased deficits, on condition that the absorption rate of these funds is a high one.

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