Press review (Dec 21)

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The Romanian daily newspapers on Monday carry reports on President Traian Basescu’s being sworn in for a fresh five-year term later in the day, the formation of the government proposed by Prime Minister designate Emil Boc, the prospects of consumption in 2010 linked to the predictions of economic growth and the harsh winter and snow that has blanketed Romania in the last days.

No matter what the fate of his second term, Traian Basescu’s victory in the presidential elections has offered a lesson worth noticing. We were shown that the human factor can beat, even though occasionally, the contingency of notable forces, apparently ready to step over everything in their way, British political analyst Tom Gallagher writes in Romania libera.

If he wishes to leave his print on Romania’s evolution in the next decades, Traian Basescu must now match his reformist rhetoric with deeds. If he succeeds making this step, he will no longer need populist gestures in order to get the people close to him and at the same time he will diminish the ambivalent feelings of many of them with respect to his real political intentions, Gallagher says in an item headlined ‘Basescu’s Option’.

Prime Minister designate Emil Boc unveiled on Sunday the list of his cabinet ministers and the principles of the governing programme. Both the list and the programme will be put forward to Parliament for approval. The proposed ministers will be first heard in the specialised parliamentary commissions, that will issue a positive or negative advice.
The commissions’ advice is consultative only, with the final decision resting with the plenary sitting of the legislature. Boc government needs 236 votes to be invested, Jurnalul National reports.

A vice premier’s post without portfolio, 15 ministries, five independent ministers and two last-minute nominations: Mihail Dumitru for Agriculture Minister and Daniel Funeriu for the Education portfolio – such were the surprises announced by Prime Minister designate Emil Boc, who completed the ministers’ list and his cabinet’s programme and sent them to Parliament.
The ministers’ hearing will begin as early as possible, even today, so that the government may be invested by Dec. 23, as President Basescu had announced publicly, Romania libera reports. ‘The 4th Emil Boc government has been ‘reshuffled’ three times since it took power’, headlines Evenimentul zilei.

The residential construction market has collapsed this year. The new apartment blocks have been completed but have no owners, the big developers have gone bankrupt, the prices are falling fast but nevertheless there are no home buyers, the Bucharest-based papers report.

Who would have thought, a year ago, that the engine of the economic development – the residential building market – will stall and will attract major bankruptcies followed by thousands of lawsuits. However, this is all true. The downturn has frozen most of the projects, with some of the developers having gone bankrupt, as they couldn’t pay their creditors because of the lack of home sales.

Gold has reached a historic high in December, having risen by 12 percent since the beginning of the year, despite the downturn. Romania still has gold reserves put at 300 tonnes and silver reserves of 1,400 tonnes at Rosia Montana, in the west. This amounts to roughly 7.5 billion euros in current gold prices. The ruling Democratic Liberals are ready to give the green light to digging for gold to Rosia Montana Gold Corporation.
‘The go-ahead to the project will be included in the governing programme’, caretaker Economy Minister Adriean Videanu, whom the prime minister designate wants to retain his portfolio, is quoted by Ziua as saying.

The recent history of gold in Romania has seen a lot of controversy. In the last years, the Romanian authorities gave the gold and silver reserves to companies behind which there were firms registered in tax havens, therefore very difficult to control. According to information released by the National Agency for Mineral Resources, nine firms got a licence to explore for or dig the gold and silver reserves, says Evenimentul zilei in a story headlined ‘Romanian gold is in the hands of little-known persons’.

The banks cannot bailout the state forever, since they have their own limits related not so much to the money they have available, but to the lending policies that make them not keep all the eggs in the same basked, Cotidianul quotes a banker as warning. This is the reason why the International Monetary Fund money is important, the banker stresses. The IMF loan tranches are extremely important because the banks will not be able to give loans to the state indefinitely, says BRD SocGen deputy director Claudiu Cercel.

Consumption could drop by 5 percent of gross domestic product next year, as it is desirable to see the economic recovery rely on investments and exports first and foremost and less on the private consumption, the economic dailies quote experts as saying. ‘The adjustment Romania must make involves the modification of its consumption and debt-based economic model towards growth relying on exports and investments’, chief economist of the National Bank of Romania Valentin Lazea explained.

Although a sudden ‘rocket recovery’ of the economy is hoped for in 2010, there will most probably be a very small growth, if Romania is to see any. Consumption will fall in 2010 too, particularly amid the limited private consumption, says chief of the Applied Economics Group Liviu Voinea.

The heavy snowfalls, raw winds and freezing temperatures in the last 48 hours have wreaked havoc across Romania, Monday’s print media reports. Dozens of motorists were stranded, several pregnant women were forced to give birth in the snow before the ambulance could arrive, there were pileups, bumps, communities left without electricity, cancelled trains, closed airports and blocked roads. Below zero C temperatures will hit Romania on Monday, but forecasters say they will go slightly up in the next days, the Bucharest-based dailies report.

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