Romania’s moment to make progress against corruption

Corruption has been one of the biggest hurdles holding back progress in Romania until recently. Now corrupt leaders have been jailed, a referendum passed overwhelmingly, and the new, transitional government has shown a real desire to tackle graft.

Protesters rally against the Romanian government in Bucharest, Feb. 5, 2017
For years, Romanians have taken to the streets, calling for an end to corruption. With a caretaker government that seems serious about the issue, now may be the country’s best chance to improve its governance. © dpa

In a nutshell

  • EU membership did not stifle corruption in Romania
  • Despite protests, the problem has worsened in recent years
  • A caretaker government is moving in the right direction

Romania has a long track record of corruption and dysfunctional government. Following years of mounting frustration in Brussels, in January 2019, when Bucharest was due to assume the rotating presidency of the European Union,  senior insiders quietly questioned the wisdom of allowing the country into the Union.

In the words of one official involved in the accession process, “We knew perfectly well at the time that Romania and Bulgaria were not ready.” The alleged mistake was to believe that by virtue of becoming member states, the two would align themselves with European standards.

A somber realization was dawning: “You can pressure a country when it wants to become a member state, but once it is in, the possibility to get reforms is considerably lower. That is a structural failure of our system,” said the official. The main question, however, is whether this gloomy verdict needs to be revised. Several events in 2019 have led some observers to believe Romania has finally turned a corner.

Backtracking on corruption

Optimists emphasize that a groundswell of anger against endemic corruption has resulted in the formation of a government with a resolute focus on the rule of law, a presidency with a reenergized ambition to support the same and a powerful boost to various elements of civil society campaigning for a fresh start. While there are grounds to take these developments seriously, the case against an optimistic outlook remains strong.

In 2004, when the “Big Bang” enlargement brought a swath of former socialist countries into the union, officials believed neither Romania nor Bulgaria had done enough to fight corruption. When they were subsequently admitted, in 2007, it was on the condition that they strengthen the rule of law, including judicial independence and the legal anti-corruption framework.

The annual cost of corruption in Romania amounts to some 38.6 billion euros, nearly 16 percent of the country’s GDP.

Believing that conditionality and monitoring would provide the necessary support for such efforts, the European Commission set up a Cooperation and Verification Mechanism that would present annual progress reports. In January 2018, Bulgaria was finally given a clean bill of health. Romania, in contrast, was told that it had lost its reform momentum, thereby “slowing down the fulfillment of the remaining recommendations, and with the risk of reopening issues which the January 2017 report had considered as fulfilled.”

Since Romania is one of the poorest countries in the EU, there is ample reason to take a dim view of how leading political actors help themselves to public funds, including contributions from the bloc. According to a recent study, the annual cost of corruption amounts to 38.6 billion euros, equal to nearly 16 percent of the country’s gross domestic product (GDP).

In its Corruption Perceptions Index for 2018, anti-corruption watchdog Transparency International gave Romania the score of 47 out of 100, ranking it as the fourth-most corrupt country in the EU (after Hungary, Greece and Bulgaria). According to the 2017 Special Eurobarometer, 68 percent of Romanian citizens believe they are personally affected by corruption, the highest proportion among all EU member states. Some 46 percent said that corruption had increased over the past three years.

Deeper slide

Following parliamentary elections in December 2016, relations between Romania and the EU took a turn for the worse. The Social Democratic Party (PDS) won 46 percent of the vote and proceeded to form a coalition government with the Alliance of Liberals and Democrats (ALDE). The new government was formed a year after Prime Minister Victor Ponta had been forced from office following mass street protests, and some looked at the change as an opportunity for a fresh start.

Ominously, however, PDS leader Liviu Dragnea had recently been given a two-year suspended sentence for inflating voter numbers in the 2012 referendum to impeach then-President Traian Basescu. Prohibited from taking office, Mr. Dragnea would still remain the most powerful figure in Romanian politics.

The new government proceeded to take measures aimed at undermining the rule of law. It decriminalized abuse of power offenses involving sums of less than 44,000 euros and embarked on legislative changes to the judicial system with minimal or no prior consultation and launched political attacks on judges and prosecutors.

Top European prosecutor Laura Codruta Kovesi
Laura Codruta Kovesi immediately ran into difficulties as soon as she was named head of Romania’s anti-corruption directorate. The European Union gave her efforts a stamp of legitimacy, however, when she was named the first European Public Prosecutor. © dpa

One key move was introducing a department for investigating judicial offenses, tasked with scrutinizing prosecutors. In November 2018, experts at the Council of Europe’s Venice Commission warned that this change would “seriously impair” the Romanian criminal justice system.” The European Parliament said it was “deeply concerned.”

Powerful enemies

A main irritant for the government was the Romanian National Anticorruption Directorate (DNA). Upon assuming leadership of the DNA in 2013, Laura Codruta Kovesi launched a tenacious operation that would target lawmakers, ministers and mayors, and result in convictions of hundreds of politicians and officials for corruption, including Mr. Dragnea (for vote-rigging).

During the spring of 2019, Ms. Kovesi would learn that she had made powerful enemies. Criminal proceedings launched in March accused her of abuse of office, manufacturing charges against Romanian politicians, an overuse of wiretapping and allowing district prosecutors to pressure witnesses. Being placed under “judicial control,” she was barred from leaving the country.

The EU responded with outrage, since Romania had only just assumed the bloc’s rotating presidency and because Ms. Kovesi was in the running to become the first head of the newly established European Public Prosecutor’s Office.

At the end of March, the European Commission admitted that the Kovesi case had caused relations with Romania to become “heavier.” In mid-May, Commission Vice President Frans Timmermans warned the Romanian government that its amendments to the criminal code “risk creating a situation of de facto impunity for crimes, including corruption crimes.”

But the implied threat of sanctions had no effect. On May 30, the Romanian Constitutional Court ruled that President Klaus Iohannis must dismiss Ms. Kovesi, which he did on July 9. Her firing was taken by some as powerful proof that the country remained firmly in the hands of corrupt politicians.

Optimistic developments

In sharp contrast to these negative developments, May 2019 also brought three substantial setbacks for the Romanian government that would provide real cause for optimism.

The first was the elections to the European Parliament, in which the government suffered huge losses. The PDS garnered only 23 percent of the vote, just half of the support it had received in the 2016 national elections. Prime Minister Viorica Dancila, in office since January 2018, was badly shaken. In a stark illustration of Romania’s dysfunctional government, she was the third prime minister in seven months and her time in office had been ridden with conflict.

For three years, Romanian politics had been captured by only one topic, namely, how Mr. Dragnea could avoid jail.

The second setback for the government was the outcome of a nonbinding referendum, called by President Iohannis to coincide with the European Parliament elections. Voters were asked to decide if the government should be banned from altering judicial legislation via emergency decrees, and if they wanted a national ban on any amnesty and pardoning for graft-related crimes. More than 80 percent of the respondents voted in favor of the bans, demonstrating the depth of popular dissatisfaction with the government’s ambition to undermine the rule of law.

The third and most important development was that by the end of the month, Mr. Dragnea had finally been jailed for corruption. In addition to his two-year suspended sentence for vote-rigging, in June 2018 he had been given an additional three and a half years in jail for using his influence to procure fake jobs at a child-protection agency for two women working for his party.

Despite these legal troubles, Mr. Dragnea had continued calling the shots, directing the appointment of three prime ministers and more than 70 ministers. Although much less prominent than Hungary’s Viktor Orban or Poland’s Jaroslaw Kaczynski, he had been greatly emboldened by their successes in standing up to Brussels. As one opposition leader said, for three years Romanian politics had been captured by only one topic, namely, how Mr. Dragnea could avoid jail.

At the end of May 2019, his luck ran out. As the Romanian Supreme Court ruled to uphold the verdict of the lower court, Mr. Dragnea was promptly taken to prison where he began serving his time. In the words of opposition politician Dan Barna from the Save Romania Union party, “With this decision, the Liviu Dragnea era ends.”

Stamp of approval

In the fall, the Kovesi case also came back to haunt the government. Much as the Polish government had lobbied unsuccessfully against the appointment of Donald Tusk as head of the European Council, Bucharest had lobbied against her candidacy for the head of the European Public Prosecutor’s Office. Though the member states had wanted a French candidate, the European Parliament came out in favor of Ms. Kovesi. She was confirmed in October 2019. This was taken by many Romanians as a stamp of approval that provided a further boost for domestic anti-corruption activism.

That same month, the government of Viorica Dancila collapsed, having lost a no-confidence vote in parliament spearheaded by opposition leader Ludovic Orban (no relation to the Hungarian prime minister) of the National Liberal Party. In early November, parliament approved a transitional government under Mr. Orban, who will hold the office until elections in December 2020.

President Iohannis won a landslide victory, promising to resume judicial reforms and lead Romania toward modernization.

Further good news for the opposition came with the presidential election on November 24. Having run on a program of law and order, the incumbent President Iohannis won a landslide victory over the now-former Prime Minister Dancila, who garnered the lowest share of the vote for a socialist candidate in 30 years. Celebrating what was billed as a “historic win,” he pledged to resume judicial reforms, install anti-graft and anti-mafia prosecutors and lead Romania toward modernization and Europeanization.

Maintaining momentum

The main question is whether these changes in the political landscape will be sufficient for Romania to break with its long-standing legacy of government corruption. The answer partly depends on whether the EU can finally serve as an anchor for maintaining reform momentum.

One of the most pressing tasks for the Orban government had been to propose an EU Commissioner. After the European Parliament rejected former Environment Minister Rovana Plumb over a conflict of interest in September, the Dancila government sought to field three other candidates. Because President Iohannis had not supported those nominations, Commission President Ursula von der Leyen rejected them. The absence of an acceptable candidate was holding up the formation of the new European Commission, so the Orban government’s proposal of MEP Adina Valean was quickly accepted.

With Ms. Valean in place and with Ms. Kovesi named prosecutor, Romania now has two important voices in the new Commission. This could improve Romania’s ties with the rest of the bloc, which was deemed poor by an EU Coalition Explorer report of the European Council. Although it regularly reaches out to major member states, it gets little response. Its main partners are Bulgaria, and to some extent Poland. Perhaps the new commission will offer Romania the benefit of the doubt and provide a window of opportunity for the Orban government to impress on Brussels that it can vigorously engage in anti-corruption activities.

Bump in the road

A potential bump in the road came in early February, when the Orban government was defeated in a no-confidence vote brought by the PDS and the ethnic Hungarian UDMR party. As a result, the government could not reintroduce the election of local officials in two rounds of voting instead of the current first-past-the-post system. In the upcoming May local elections, both the PSD and the UDMR would have stood to lose much from such a change.

If snap national elections are held, the government will have a better chance of forming a coalition government than if the regular parliamentary elections take place at the end of the year as scheduled. Since it came to power, the National Liberal Party’s approval ratings have risen from 30 to 47 percent, with the PDS polling below 20 percent. In early January, President Iohannis and Prime Minister Orban had already agreed to begin preparing for early elections.

If Romania does succeed in charting a new course, it will not only vindicate those in Brussels who argued that conditionality and membership would help turn the country toward better governance. It might even provide a boost for similar ambitions in Ukraine.

Given the depth of the legacy of corruption and dysfunctional government, it would be prudent not to get one’s hopes too high. But there is reason to believe that the country now has its best shot in a long time to put its house in order.

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