Romania weekly review: A President gets down to work

Romania weekly review: A President gets down to work

Bucharest, January 17, 2015/ Independent Balkan News Agency

By Daniel Stroe

After the initial three weeks spent below the radar, Romania’s new President Klaus Iohannis has started surfacing on both the central and European scene. His political debut in the country’s top job overlapped an all-time increase of the Swiss Franc against the national currency which left tens of thousands of people who have to repay loans in CHF worried.

After a shaky debut in his office, following a controversial award granted to a former communist dissident believed to have had far right sympathies, Klaus Iohannis has this week taken the central role in the Romanian politics. On Monday, he summoned the parliamentary political parties and discussed a cross-party agreement on raising the military budget to the 2 per cent threshold, as the NATO commitments assumed by Romania and other countries provide. Only four member states of the military bloc spend at least 2 % of the GDP for their defense (USA, UK, Greece and Estonia), with many even cutting military spending amid the economic crisis.

Iohannis picked the heavily debated topic in the Western chancelleries and turned it into a personal initiative which was well received across the parties and population as well, quite sensitive about the conflict in the neighboring Ukraine and Russia’s renewed hegemonic ambitions. “Europe and NATO have to cope with the biggest security challenge since the end of the Cold War. For the first time, a state resorts to force to redraw frontiers. These very serious things are happening next to our borders and must not be ignored. We are NATO member states but this doesn’t mean others have to ensure our security” Iohannis said today in a live statement.

The President also pointed out it is for the first time over the past 25 years, since Romania toppled the communist regime, that a head of state proposes all the parties a defense pact. “I have reached the necessary consensus that the defense budget reaches 2 % of the GDP in 2017. Moreover, I have proposed this level shall be minimum and be kept for at least ten years”, he added. The pact was signed on Tuesday, one day after meeting political leaders.

As he reaped the glory of a political agreement well reflected abroad, Iohannis received Victoria Nuland, US assistant secretary of state for European and Eurasian Affairs. Nuland returned to Bucharest a year after a stormy visit to Romania following the so-called “Black Tuesday” when Romanian lawmakers tried to pass a law on amnesty and shielding themselves from corruption charges. The attempt again raised eyebrows, only two years after the worst political crisis in Bucharest when rule of law principles were seriously violated in PM Victor Ponta’s attempt to oust then President Traian Basescu, his main arch-rival.

Nuland’s visit came shortly after a transfer of power at the helm of Romania. Iohannis assured her Romania is interested in strengthening the strategic partnership with the United States, while Nuland pointed out Washington expected Romania to continue reforming the political class and fortifying the rule of law. “We are witnessing a new political beginning for Romania”, she said, pointing to Iohannis’s election last November amid a very high turnout. The US official also pleaded for Romania to expand instruments in combating terrorism by passing the laws on data retention and registration of PrePay card users, last year rejected by the Constitutional Court.

Iohannis then started his first official visit abroad by going to Brussels, meeting both EU and NATO officials. He was assured the European Commission is fully supporting Romania’s Schengen accession efforts, a discussion reopened as Iohannis was elected. But a report on the country’s progress in the field of justice is essential to the country’s long desire to enter the Schengen area, even if signals launched early this year are not that encouraging. Romania is said to have had a better performance in reforming justice than Bulgaria and some politicians in Sofia are even warning the country could be decoupled from Romania in the Cooperation and Verification mechanism. Iohannis is to travel to Paris and Berlin later on to discuss the Schengen file, which was almost completely buried after the 2012 political turmoil.

As Iohannis was breaking ground diplomatically, at home about 100,000 Romanians were getting the willies after the Swiss Franc hit an all-time high against leu, the Romanian national currency. The monthly bank installments almost doubled for many since the 2006-2008 period when most of the CHF loans were taken. After the Swiss Franc’s sudden increase this week, a debtor has to pay about a 100 USD more for a bank installment, preliminary statistics show. While PM Ponta urged his Finance minister and the National Bank governor to discuss the matter, the latter said the issue can only be settled by the banks discussing it with the debtors. A wave of trials is currently underway in Romania in which people who got CHF bank loans are trying to convince judges they have to pay the loans at the exchange rate when the credits were finalized.