Basescu on the election trail
Results from the hotly contested Romanian Presidential election broke last night. The Incumbant Traian Basescu, former Mayor of Bucharest, narrowly defeated his challenge, Social Democrat leader Mircea Geoana by a mere 0.6% of the vote – 50.3% to 49.7%.
Accusations of vote fraud are jumping left, right and centre from Geoana and his party.
The IMF stepped in earlier this year to prop up the ailing Romanian economy to the tune of $30 billion. Interestingly enough, the IMF released a survey last week citing it’s influence in preventing economic meltdown and calling for political reform in Eastern Europe – Latvia and Romania were called out especially. The very narrow election win margin coupled with bitter allegations of unsound electoral practices is the last thing that the IMF wants to hear.
A closer look at the precarious position of the government shows, the dangers run much deeper. Romania’s coalition government collapsed in October under a storm of alleged plans to enact voting fraud on massive scale to influence the outcome of the Presidential election. The junior partner party in government, the Social Democrats, withdrew from government leaving Besescu’s party, the Liberal Democrats, as a minority government with a budget for next year to pass through parliament. The pressure cooker of fingers of fraud being pointed and a minority government trying to draft and agree a budget was enough for the IMF to withhold €1.5 billion out of the €20 billion financial package to the country until a new government is formed and reform is seen to be progressing.
Romania was one of the fastest growing economies in the EU before the recessionary wave. With a healthy GDP rate of 6.2% in 2007 and an unemployment rate of 3.9% in September of that year it was one of the best positioned economies to benefit the geographic slide of multinational investment from Western European and the US. In stark contrast, the World Economic Forecasts estimates the country’s GDP numbers to be in the region of -8.5% this year and a flat 0.5% in 2010.
Jobless numbers are also on the rise. October’s unemployment numbers stood at 7.1%, a 0.2% rise on the previous month. Eagle-eyed economists believe that those out of work will hit 8% before the year’s end. Unemployment now stands at a five-year high.
Some twenty years on from the bloody Romanian revolution, could the bite of economic woes kindle memories of Communist entitlement?
It’s interesting to note that Romania was the only member of the Iron Curtain that executed its leader. Will the cut and thrust of the economic collapse backed by swell of public pain and political pressure force Basescu into a corner? Only time will tell.
