Transcript Romanian economy within the EU

Romanian economy within the EU –
A conceptual analysis
Florin Bonciu, Ph.D.
Bucharest
June 14, 2016
Contents
• The wider context of analysis;
• Economic integration: prerequisites of success
• Comparing theory with reality: Central
European countries and Romania;
• The need for a Romanian country project Achieving the status of developed economy
• Conclusions
The wider context of analysis
• EU and the world economy. Where it stands,
where it goes ?
• EU and Europeans. Recent perceptions.
• What about the future ?
• The need to talk more about people than
about numbers, directives or scenarios …
In 40 years (1980 – 2020) the EU’s share of world GDP
declined from 30 % to 15 % despite several enlargements
EU – what about the future ?
• We propose to shift the focus from:
Unity in diversity
to
Diversity in Unity
• European Union is characterized by diversity.
• This diversity should become a strength instead of
being a weakness.
Economic integration: prerequisites of
success
• 1) A similar level of development;
• 2) A political will in favor of integration based
on a large support from the citizens.
• In 2007 Romania had definitely the second
(with over 80 % popular support) but (at
about 30 % of the EU average GDP/habitant)
lacked entirely the first.
The limits of the cohesion policy
• The cohesion policy has been designed to address
exceptions and not entire countries.
• The cohesion policy is supposed to be implemented
by the authorities of the member states.
• When there is no similar level of development a
vicious circle appears.
Correlation between levels of development
and efficiency and effectiveness of national
authorities
• Developed countries = more efficient and effective
authorities;
• Less developed countries = less efficient and
effective authorities.
• In an objective way, less efficient and effective
authorities can not act as those from developed
countries and can not raise the less developed
countries by themselves. – See next slide.
Baron Munchausen pulls himself out of a mire by
his own hair (illustration by Oskar Herrfurth).
OECD – a proxy of the development level
• Central European countries became OECD members
BEFORE their accession to EU:
• Czech Republic – 1995
• Hungary - 1996
• Poland - 1996
• Slovak Republic – 2000.
• After accession:
• Estonia - 2010
• Slovenia – 2010
• Lithuania invited in 2015
• Latvia invited 11 May 2016
The need for a Romanian country project
• In our opinion, Romania can be better off within
the EU by adopting as a country project the
Achieving of the status of developed economy
• based entirely on tangible indicators
(infrastructure, housing, education, environment,
health care, etc.)
• Best practices are widely available in the EU.
Conclusions
• In order to achieve sustainable growth and
participate as a full member of the European Union
Romania should become first a developed state;
• Particularly given the current geopolitical context
EU and US should assist Romania in becoming a
market economy, capitalist developed state;
• Remember East – West Berlin or North – South
Korea; or the reunification of Germany ….
• New approaches and mechanisms are needed but
they are fully within reach.