IN-DEPTH ANALYSIS

Economic Dialogue with

Romania
ECON on 7 November 2022
This note presents selected information on the current status of the EU economic governance procedures and
related relevant information in view of an economic dialogue and exchange of views with Mr Adrian Câciu,
Minister of Finance of Romania, in the ECON committee of the European Parliament. The invitation for an
exchange of views is in accordance with the EU economic governance framework.

1. Economic situation in Romania

According to the latest Eurostat information, Romania’s economy
Box: Profile of the Minister
experienced one of the highest GDP growth rates among the EU
Member States during the second quarter of 2022, which stood at 2.1% Minister Adrian Câciu took
(compared to the previous quarter). Strong economic growth that office as Minister of Finance on
25 November 2021. Prior to this
Romania witnessed in the first half of 2022 substantially contributed to a he was an advisor for economic
solid 5.3% annual GDP growth (2022 Q2 compared to corresponding and budgetary matters in the
quarter in 2021). Social Democrat Party, and
prior to that he has held
Nevertheless, the inflation level in Romania (13.4% in September 2022) various positions in the
is quite elevated and exceeds the EU average (10.9% in September Ministry for Agriculture and
2022), and it has been increasing since the end of 2020 (even though a Rural Development and the
State Holdings Agency. He has
more rapid increase started taking place a year ago).
graduated the Faculty of
According to the Commission, such strong growth can be explained by a International and Domestic
solid increase in gross fixed capital formation and private consumption, Commercial and Financial
Banking Relations at the
as well as is also backed by higher wages; the country report for Romania Bucharest Academy of
suggest that “Romania’s economy was catching up fast before the Economic Studies and has a
pandemic, but not in a fully sustainable way ... growth was demand-driven Master’s degree in
and boosted by expansionary fiscal policy, which resulted in growing current Management of rural and
account deficits and macroeconomic imbalances”. regional development projects

Overall, the unemployment level is relatively low, at 5.1% in August 2022 (compared to the EU average of
6.0% and euro area average of 6.6%) and it has been declining since the beginning of the year. However,
youth unemployment is one of the highest in the EU, standing at 22.8% according to the latest Eurostat
information. It should also be noted that according to Eurostat, in the second quarter of 2022 decline of
employment in absolute number of persons was one of the largest in the EU (over one quarter it shrank by
0.5%), which in turn implies that improved unemployment rate figures are influenced by the declining active
labour force (i.e. declining denominator in the calculations of the unemployment rate).

Economic Governance Support Unit (EGOV)

Authors: Samuel DE LEMOS, Kristina GRIGAITĖ, Cristina DIAS, Ovidiu TURCU
Directorate-General for Internal Policies EN
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Figure1. Romania’s inflation and fiscal indicators

OECD.

Russia’s invasion of Ukraine is expected to negatively affect Romania’s economy and has caused
various institutions to review economic projections (see Table below and Annex 1). The National Bank of
Romania is projecting that there should be a relative stagnation of Romania’s economy in the coming
quarters.
Table 1. GDP and Inflation growth forecasts for Romania
COM Summer 2022 IMF WEO
Year Forecast OECD June 2022 October 2022
July 2022
Gross domestic product, annual percentage change
2020 -3.7% -3.7% -3.7%
2021 5.9% 5.9% 5.9%
2022 3.9% 3.1% 4.8%
2023 2.9% 2.6% 3.1%
Inflation, annual percentage change
2020 2.3% 2.6% 2.6%
2021 4.1% 5.0% 5.0%
2022 11.1% 11.9% 13.3%
2023 7.2% 8.5% 11.0%

The Commission highlights that Romania is still facing several longer-term structural challenges in
various areas (see also below section 3 on recommendations for Romania in the context of the European
Semester). “Romania’s business sector has long-standing structural weaknesses ... inefficient public
administration and unpredictable legislative framework ... are detrimental to the business environment and limit
investment opportunities ... There is significant scope for the correct use of corporate governance principles in
state-owned enterprises in key sectors such as energy, transport and local public utilities”. Furthermore, the
OECD suggests that “expanding the tax base, notably by removing special tax regimes and exemptions would
improve public finance sustainability and make the system more equitable. At the same time, improving the
coverage and adequacy of the social assistance system would reinforce support to vulnerable households. The
high reliance on fossil fuels calls for accelerating investment in renewable energy sources ... Accelerating building
refurbishment in deprived areas can achieve large efficiency gains and help to reduce energy poverty”. It is also
reported that regional disparities remain high and are mainly driven by labour productivity, investment and
employment gaps between the capital and the regions.

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In the latest financial stability report, the National bank of Romania highlighted that “assessments on
systemic risks were tightened for certain categories, while prospects for the period ahead are mixed. Two severe
systemic risks were identified ... global uncertainty amid the energy crisis, the war in Ukraine and the COVID-19
pandemic and the worsening of domestic macroeconomic equilibria, inter alia as a result of geopolitical and
international developments ... The other two systemic risks identified, i.e. the delay in implementing reforms and
absorbing EU funds [ 1], especially via the National Recovery and Resilience Plan (NRRP) and the default risk for
loans to the private sector, remain elevated, with prospects to rise for the former and a stable outlook for the
latter”.
Table 2. Map of risks to financial stability in Romania

Source: National bank of Romania, Financial stability report June 2022.

In the same context one may also note that in 2018, the IMF pointed to four key vulnerabilities in its
Financial Sector Assessment, namely the banks’ exposure to government debt, their exposure to the real
estate market, non-performing loans, and growing lending by the shadow banking system. Romania’s most
recent financial stability report shows that since the IMF’s related warning in 2018, the banks’ claims on the
government sector have actually further increased, and that the exposure to the real sector has since also
further increased (see figure 2).

1
The IMF article IV consultation concluded the same - “Public investments is projected to rise, supported by EU funds, including new RRF
resources, though absorption will likely remain moderate”.

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Figure 2: Banks’ exposure to the government sector and the real estate sector over the past years

Source: National Bank of Romania, Financial stability report June 2022

Despite the fact that households’ burden of electricity expenses in Romania is among the lowest in the EU”
and, as the IMF points out, Romania is largely self-sufficient in energy, the rise in energy prices could be
worrisome for Romania. Based on the National Bank of Romania analysis, “vulnerability stems from the fact
that Romanian households are among the most exposed to energy poverty in the European Union. Even
before the significant rise in electricity and natural gas costs, households posted the third highest percentage
in terms of arrears on utility bills and the second highest in the EU for the inability to keep homes
adequately warm”. In addition to this, effects of increasing energy prices should not have worrisome impact
on non-financial companies, nevertheless, it is still expected that for certain energy intensive companies the
probability of default will rise substantially.
The Romanian government scheme to cap energy prices that was initially introduced in 2021, has recently
been extended till end of August 2023 and introduced some changes to stimulate consumers to save energy
(this was earlier criticism received from the IMF); the media recently reports, however, that energy suppliers
experience a cash flow problem as the Romanian government is struggling to maintain payments in the
context of the implementation of the scheme. More information about Romanian government energy
saving measures can be found in a dedicated EGOV study.
Despite the fact that Romania, as energy and grain producer, seems to be quite protected from direct
disruptions of the war in Ukraine, the National Bank of Romania projects that “although Romania’s direct
economic and financial ties with Russia are Ukraine are not substantial ... the effects of the war are expected to
hit Romania ... by fuelling inflation, depressing investor confidence and reducing economic growth in the
country’s main trading partners”. In a similar vein, the IMF analysis highlights that “the economic effects of the
war will likely materialize primarily through higher commodity prices, diminished trading partners’ demand,
refugees and higher risk premia ... the duration, severity and geographical scope of the war is highly uncertain,
and a confluence of adverse shocks could be more damaging ... Broader shut-offs of Russian gas across EU
countries could precipitate an EU-wide GDP contraction and supply shortages. An escalation of naval conflicts in
Ukraine’s south could affect the security of Romania’s Black Sea ports and sea lanes. Destabilization of
neighboring Moldova may trigger a more disruptive refugee exodus into Romania”.

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2. The Romanian Recovery and Resilience Plan

2.1 Overview of the Romanian RRP and its assessment
Romania put forward its Recovery and Resilience Plan (RRP) on 31 May 2021; the country requested EUR 14.3
billion in grants and EUR 15 billion in loans under the RRF, which broadly covers the amounts available to it
under the RRF.
The Romanian plan is structured around the six pillars foreseen in the RRF Regulation: the green transition,
digital transformation, smart growth, social and territorial cohesion, health and resilience, and policies for
the next generation. The plan includes measures on sustainable transport, education, healthcare, building
renovation and the digitalisation of public administration clustered around 15 components and proposes
projects in all seven European flagship areas. The plan includes a total of 507 milestones and targets. A
specific website contains links to the relevant RRP-related documents (available here).
On 27 September 2021, the Commission adopted its assessment of the Romanian plan. The Commission
assessment is composed of a draft Council Implementing Decision (CID) and an annex, and a staff working
document (SWD). The Council adopted the CID (and its annex) on 28 October 2021 and agreed with the
Commission’s positive assessment of the Romanian plan. For an overview of Member States’ RRPs and their
adoption procedures, see specific EGOV briefing.
Commission’s simulations on the potential impact of the Romanian RRP, as set out in the SWD, are outlined
below. The effective impact of the RRP will depend of its full implementation, which is being impacted by
the situation in Ukraine and overall economic situation and developments in the EU (see above section 1)2.

2
In relation to the macro scenario underpinning the RRP, the Commission noted that “The macroeconomic scenario of the RRP was
plausible at the time of the submission of the Romanian RRP (...) Due to the better-than-expected performance of the economy in
the first quarter of 2021, these RRP estimates appear now rather cautious. The macroeconomic and fiscal outlook continues to be
affected by high uncertainty related to the COVID-19 pandemic and its economic consequences.” (SWD , p. 8).

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Box 1 - Stylised NGEU impact simulations with QUEST – Romania

Source: Commission SWD, box 2, p. 47.

In accordance with the Commission assessment, the Romanian plan complies with all the 11 assessment
criteria under the RRFR, with a B rating only in the costing dimension (see table below); all Member States
have a B rating on costing estimates.
Table 3. Commission’s assessment and rating of the recovery and resilience plan of Romania
(1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11)
Balanced CSRs Growth, DNSH Green Digital Lasting M&T Costing Control Coherence
Response jobs… target target impact Systems

A A A A A A A A B A A

Source: Commission SWD, p. 5

According to the Commission, the Romanian plan covers 171 measures (64 reforms and 107 investments)
divided into 15 components; 507 milestones and targets (M&T). The graph below illustrates the amounts to
be spent per pillar. 41% of the plan’s total allocation for reforms and investments supports climate objectives
and 21% support the digital transition.

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Figure 3: Share of the plan’s estimated expenditure (grants and loans) contributing to each policy
pillar

Source: Commissions’ RRF Scoreboard. This graph displays the share of the recovery and resilience plan’s estimated contribution to
each policy pillar. As each measure contributes towards two policy areas of the six pillars (primary and secondary assignments), the
total contribution to all pillars displayed in this graph amounts to 200% of the RRF funds allocated to the Member State. The amounts
in the lower part of the bars represent the primary assignments, the top part the secondary assignments.

The following can be noted as regards the Romanian RRP 3:

• “Regional disparities in Romania are among the highest in the EU”: this evaluation is confirmed in
a recent external paper commissioned by ECON (from CASE) that assessed the EU value added of a
set of RRPs. Romania is one of the few Member States that foresees measures specifically addressing
details of distribution/organisation of investment and reforms per NUTs 2 regions (see here). Italy is
another of such examples (see here). The Commission considers that “component 10 (Local Fund),
targeting both urban and rural development, aims to provide the necessary framework for the
development of the regional level through investments in local infrastructure that are expected to
support the resilience and green transition of urban and rural areas, as well as to reduce territorial
disparities at regional, intra-regional and intra-county level”. Other measures - such as sustainable
transportation or digitalisation - are expected to contribute to reinforcing territorial cohesion.
However, the CASE researchers argue that the plan “includes a dedicated component on regional
issues with reforms and/or investments targeting social services in regions (...) , but the risk is that the RRP
will exacerbate regional disparities with its focus on the comparatively richer regions”;
• By strengthening the independence and increasing the efficiency of the judiciary, improving access
to justice, and stepping up the fight against corruption, the plan aims to address the main issues related
to respect of the rule of law in the country”. Romania has been recommended over time to reinforce
its judiciary system and public administration overall (see specific EGOV paper assessing how
Member States’ RRPs are addressing public administration related CSRs). The Commission considers
that measures included in component 14 (on good governance) “are also expected to: i) ensure the
independence of the judiciary and enhance its quality and efficiency; ii) to step up the fight against
corruption, by adopting the national strategic framework for its prevention, by strengthening the
capacity of the institution competent to combat it, by recovering the damage and proceeds of crime; and

3
Quotations below are from the Commission SWD, unless stated otherwise.

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iii) to strengthen integrity in the civil service and ensure an efficient system for declaring assets and
interests, while developing and implementing the new anti-corruption strategy”.
Romania is currently being monitored under the Cooperation and Verification Mechanism (CVM)4.
In its 2021 Rule of Law report (RoL) 5 published in July 2021 (Romanian chapter here), before the
assessment of the Romanian RRP, still signals, at the time of writing, a number of areas where
improvements are needed and concerns are relevant (notably as regards primacy of EU law, the
functioning and independence of the judicial system, and unavailability of human resources in a
number of areas). The 2022 RoL report, published on 13 July 2022 (Romanian chapter here), points
to positive developments, notably due to implementation of the RRP, but also to remaining
weaknesses. The Commission signals, in particular, concerns related to the new system for the
investigation and prosecution of criminal offences, judicial independence, (lack of) human resources
in the judiciary, fragmented legal framework on integrity, no uniform provisions on revolving doors
for public servants or lobbying rules for Members of Parliament. Transparency of political party
financing is limited. The Commission also signals that “The Government made a clear commitment to
the principle of primacy of EU law, but concerns remain regarding the challenge to this principle by the
Constitutional Court.”;
• Romania will be benefitting from technical assistance under the Technical Support Instrument
(TSI; for details on the instrument see a specific EGOV paper) to implement measures at least in three
different areas - to improve the governance of state-owned enterprises, to develop a legislative and
regulatory framework conducive to future technologies, in particular hydrogen and storage
solutions and building capacities to monitor the implementation of the plan and coordination with
other EU and non EU support instruments. One additional project 6 involving the TSI is identified in
the Commission TSI webpage. Romania is one of the few Member States that requested transfer of
RRF funds to the TSI (see here and here) to assist in implementing the plan;
• Green challenges are addressed in the Plan mostly under components 1 to 6 – dealing with water
and waste management, forests and biodiversity, sustainable transport, renovation and energy,
with other components contributing indirectly to meeting the green targets (see Figure 1 above).
See a specific EGOV briefing explaining how Romania is addressing its green 2019 and 2020 Country
Specific Recommendations (CSRs). According to that analysis, and based on the Commission’s
assessments, Romania needs more investments, policies or reforms to reach envisaged or
committed climate goals and could do more to improve air quality, water management and pricing.
Romania also faces shortcomings in transport infrastructure and policies and renewable energy
(decarbonisation being one of the main challenges 7). Although the Commission considers the
Romanian plan is meeting the green target set out in the RRF regulation (and granted it an A
assessment), the Green Recovery Target concludes differently (see here), arguing that only around
24% of measures should be accounted for meeting the green targets, which is below the objective

4
The Cooperation and Verification Mechanism (CVM) was established at the accession of Romania to the EU in 2007 as a transitional
measure to facilitate Romania's efforts to reform its judiciary and step up the fight against corruption. It represented a joint
commitment of the Romanian State and of the EU. In line with the decision setting up the mechanism and as underlined by the
Council and confirmed by the Court of Justice of the European Union (CJEU), the CVM ends when all the benchmarks applying to
Romania are satisfactorily met (for further details, see Commission’s website here). Commitments under the CVM and the RRF are
separate (see SWD , p. 13).
5
In the report, the Commission recognises the link between strong RoL principles and institutions and economic recovery: “There is
also a close link to EU policies to bring economic recovery: strong justice systems, a robust anti-corruption framework, and a clear and
consistent system of law-making, the protection of the EU’s financial interests, and sustainable growth. This is a key driver for the work of
EU instruments which promote structural reforms in Member States. In addition, the quality of public administration and the rule of law
culture as reflected in the way authorities apply the law and implement court decisions are key.”.
6
The Commission is supporting Romania with the reform of the tax administration, by helping to deliver input for the revision of
the legal and institutional framework for fiscal control activities, as set out in component C8 of the national RRP (see here).
7
See Bankwatch here and here. Additional reports from Bankwatch on Romania can be found here.

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set out in the RRF Regulation. Bankwatch also published a number of reports covering Romania and
concluding, notably, that afforestation targets will be missed if deforestation (mostly due to illegal
logging) and corruption are not tackled (see here, pages 43-47) 8 9;
• the Romanian RRP “contains some measures expected to contribute to addressing the country’s
challenges in the area of gender equality and equal opportunities for all” notably as regards the needs
of people with disabilities, equalising men and women retirement age over time, improving the
representation of women in decision-making positions of State Owned Enterprises, starting the
implementation of the Minimum Inclusion Income, improving the quality of the long-term care
services for the elderly as well as to establish an objective minimum wage setting mechanism.
Romania has a specific measure addressing gender - it introduces a mandatory minimum threshold
for women’s participation in training, education or digital literacy programmes of 50% in the Digital
transformation pillar (for further details how gender specific issues are addressed in national RRPs,
building on 2019 and 2020 CSRs, see a specific EGOV paper);
• Romania’s Plan includes participation in a multi-country project in the digital sector on Low Power
Processors and Semiconductor Chips, expected to be implemented mainly through participation or
association to a planned Important Project of Common European Interest (IPCEI). It also comproises
participation on Trans-European Transport (TEN-T) corridors. For further details on cross-border
projects, including those Romania is involved in, see a specific EGOV paper. According to EGOV’s
calculations, Romania is spending around 12% of its RRF spending in cross-border projects (to a
large extent due to infrastructure).
Before disbursement of any funds under the RRF (except pre-financing), Romania will reinforce its national
control and monitoring system (for details on monitoring and control systems for RRF purposes see a
specific EGOV briefing and here). In fact, Romania is one of the Member States where the Commission
identifies the need for reinforcing control systems ahead of disbursements under the RRF (see here and
here). As the Commission explain, “As part of the assessment of the plans, and in line with Annex V 2.10 of the
RRF, the Commission has checked the robustness of the Member States’ control systems. This check is a pass or
fail mark. However, should the Commission detect weaknesses in the control systems, which can be addressed, it
has proposed to add measures necessary for complying with Article 22 RRF that need to be attained before the
first disbursement can be made (with the exception of pre-financing). These measures are included in specific
milestones in the annex of the CID”.

2.2. Stage of implementation

Romania received EUR 1.8 billion in pre-financing on 2 December 2021 as part of the grant component of
the RRF. On 13 January, the country received EUR 1.9 billion of the loan component. Following the re-
assessment of 30% of the grants allocation in June 2022, Romania is expected to have a reduction in its
grants allocation (see here for further details).
The operational arrangements allowing further disbursements under the Facility were signed on 25 May
and Romania submitted a first payment request on 1 June. The Commission gave a preliminary positive
assessment to Romania’s first payment request on 15 September. The Economic and Financial Committee

8
Bankwatch published in December 2021 its latest update on a number of Just Transition Mechanism plans. Romania is covered by that report.
Bankwatch concludes that “There are six Territorial Just Transition Plans under development in Romania. The Plans are for the Hunedoara, Gorj, Dolj,
Galati, Prahova and Mures regions. Only Gorj and Hunedoara are coal mining regions, while the remaining four have been designated as greenhouse gas-
intensive areas that will also undergo a transition process within the coming years. All six plans were submitted to the European Commission in July 2021
and are currently under review. The Commission provided feedback to the regions, which has been integrated into the draft plans.”.
9
The Commission SWD (see pages 52-53) contains explanations on how these measures have been assessed as regards the “do no
significant harm” principle and describes the mitigation measures that have been incorporated. These include, notably, green
taxation measures, incentives for zero-emission vehicles both for private and public use, scrapping of polluting vehicles, increases
in the number of electric vehicle charging stations from 1 800 to 30 000 over the Recovery and Resilience Facility implementation
period, planting of forest 53 curtains and new forests (45 000 Ha), as well as digitalisation of transport (e.g. Intelligent Transport
Systems) to improve traffic efficiency. The SDW also explains how certain energy infrastructure contribute to achieving the
objectives of the EU green agenda.

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gave its opinion on 7 October and on 17 October the RRF Committee gave an unanimous positive opinion
(Slovenia not represented) to the Commission’s positive assessment.
The bulk of payments under the RRF is expected in the years 2022 to 2024, as per Figure 2 below.
Figure 4: Disbursement profile of Romania RRP

Source: Commission’s presentation to Council (on 12 October 2021)

This first payment request covers 21 measures, spread around various pillars of the Romanian RRP. In
particular, measures relating to reinforcing public administration, fighting corruption and reinforcing
monitoring and control systems (a pre-condition for receiving any funds under the RRF, other than pre-
financing), have been assessed (measures 450 and 451).
As regards monitoring and control systems, the Commission’s assessment still points to minor deficiencies
and, therefore, its assessment reflects Romania “has committed to continue to develop its system to improve
its functionalities and efficiency by: Using the European Central Platform for identifying beneficial owners of
foreign companies, should it become available” and will implement some temporary remedial actions,
reporting back to the Commission by 31.10.2022. The EFC opinion also stresses that the Commission and
Romanian authorities provided further information on “the absorption capacity and the availability of
qualified staff in certain areas, on the audit and control system of the Recovery and Resilience plan for Romania,
with a particular emphasis on collection and provision of data on beneficial owners, and on the implementation
of measures related to the anticorruption strategy. They also provided explanations on the different legal
instruments used to fulfil some of the milestones as well as on the difference in audit conclusions with regard to
their fulfilment“.
On 27 October, the Commission disbursed to Romania the net funds of this payment request. Romania
received EUR 2.6 billion (EUR1.8 billion in grants and EUR0.8 billion in loans, net of pre-financing).

2.3 Governance structure; monitoring at national level

In the SWD 10, the Commission notes that “the implementation of the plan will crucially hinge on the
administrative and implementation capacity of the implementing bodies which will need to be closely

10
SWD, p. 4.

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monitored” 11. Romania’s RRP rests a multi-level governance structure 12. At central level, the coordination is
ensured by the Inter-ministerial Committee for the Coordination of the Plan, responsible for examining
progress in the implementation of the Plan, in close cooperation with the Ministry of Investment and
European Projects (‘MIEP’). The MIEP was appointed national coordinator for the preparation, negotiation
and approval of the Plan, assisted by the Ministry of Public Finances. The internal control system is structured
similarly to cohesion funds - i.e. a centralised management and decentralised implementation.
Implementation of the Plan will be ensured by line ministries and subordinated structures, through the
conclusion of financing agreements with MIEP. The contracts will comprise provisions related to the
monitoring of the investments and reforms, financial planning execution as well as reporting obligations.
Audit will be conducted by the national Court of Auditors. A specific milestone has been included to ensure
that the IT system collecting and reporting data would be set up ahead of the first payment request. The
approval of a Government Emergency Ordinance on the financial, implementation, control and audit
mechanism is a milestone in the Plan as well. The Romanian authorities prepared and disclosed an anti-fraud
policy, which is presented together with other RRF-related documents (in Romanian, here).
Support from the TSI has been requested to assist in building capacities to monitor the implementation of
the Plan and coordination with other EU and non EU support instruments (see previously on point 2.2 on
TSI support). The project is possibly ongoing but there is little information available on its exact scope and
timing.
Romania has showed in the past difficulties in absorbing EU funds (see Commission’s data here and here, as
an example, and the discussions around EFC opinion on the first payment request, above) and it is identified
as one of the risks for the economic recovery (also see Section 1).

3. European Semester developments and recommendations

3.1 Implementation of the European Semester Recommendations
As part of its 2022 country report, published in the context of the European Semester Spring 2022 package,
the Commission assessed the 2019-2021 country-specific recommendations (CSRs) addressed to Romania
under the European Semester and notes that, overall, 27% of CSRs showed at least "some progress", while
73% showed "limited" or "no" progress (also see Annex 3).
Figure 6: Romania’s progress on the 2019-2020 CSRs

11
See also, in this respect, the EFC opinion on the 1st payment request above.
12
See an EGOV specific paper for an overview of national governance structures set up to implement and monitor the RRPs.

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Source: Commission Staff Working Document - 2022 Country Report - Romania

The Commission also assessed Romania's progress towards the Sustainable Development Goals (SDGs). The
SDGs are a policy framework with monitored indicators within the United Nations 2030 Agenda for
Sustainable Development, which focus in particular on ending all forms of poverty, tackling inequality and
climate change.
Overall, the Commission considers that, despite a few caveats, Romania performs very well or is improving
on several SDGs indicators related to environmental sustainability, on indicators related to fairness and on
those related to productivity, but highlights that weaknesses on corruption and rule of law as well as on
quality education persist.
Figure 5: Progress towards SDGs in Romania in the last five years

Source: Commission Staff Working Document - 2022 Country Report - Romania. Data from Eurostat

The 2022 country report on Romania also provides an overview of the existing and emerging challenges
facing the country, beyond those addressed by the Romanian RRP, as well as an analysis of its resilience,
notably following Russia's invasion of Ukraine and the need to reduce energy dependencies.
The Commission structures its recommendations as mentioned in its country-report around the following
points in particular:
Strengthening innovation capacity and competitiveness
Further efforts are needed to make the business services market more open and competitive. The
Commission considers that while productivity in Romania has grown significantly, there is considerable
scope for catching up with the rest of the EU. In particular, SMEs have an average productivity three times
lower than in the EU. The Commission therefore considers that SMEs, that do not benefit from foreign direct
investments and are sometimes undercapitalised, need an improved ecosystem in order to thrive, by
developing a competitive business environment, forging partnerships between science and industry, and
facilitating access to finance, notably through the development of financial intermediation.
The Commission's country report also recommends that Romania improve the relationship between
scientific research and industry by creating appropriate research and development partnerships.
Romania is struggling to innovate and the capacity of firms to absorb technology remains limited. Gross
expenditure on R&D in Romania is the lowest in the EU, and the relative number of technology start-ups and
high-growth technology companies (often drivers of innovation) is lower than in other Member States.
Finally, in order to strengthen innovation capacity and competitiveness, the Commission considers that
Romania should remove in particular unnecessary regulatory barriers to access to certain
professions, notably notaries, architects and accountants.

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Improving access to social services, including active labour market policies, and education for disadvantaged
groups
The Commission considers that Romania needs to address regional disparities in access to social
services, particularly in rural areas. Some social groups also face severe poverty. Romania has one of the
highest proportions of people at risk of poverty or social exclusion in the EU. The ratio between the top and
bottom 20% of the income distribution remains among the highest in the EU in 2020. Disadvantaged groups
such as undeclared workers, the self-employed in agriculture, the Roma population, people with disabilities,
the elderly and the homeless are among those most affected and face a higher level of risk than the EU
average. Furthermore, access to essential and social services remains insufficient, with significant disparities
between rural and urban areas and between regions.
In view of this situation, the Commission considers that Romania needs to improve the situation of
vulnerable groups by enhancing skills and providing more effective activation measures, including by
significantly strengthening the capacity of public employment services to provide targeted and integrated
support. Romania should also increase the attractiveness of vocational and adult training and promote
equal opportunities in the education system by improving the quality and inclusiveness, in particular for
Roma, of pre-school education and the school system. Finally, the Commission recommends that the
imbalance in the quality of education between urban and rural areas should be reduced in order to
overcome geographical disparities.
Energy challenges linked to the geopolitical situation should favour European security of supply
The Commission recommends Romania to reduce overall dependence on fossil fuels and diversify
imports. Romania should also accelerate the deployment of investments in green infrastructure, in
particular as regards the energy efficiency of the buildings and the decarbonisation of industry.
The Commission recalls that Romania is committed to phasing out most of its coal-fired capacity (85%) by
2025 and to completely eliminate coal by 2032.
The Commission stresses that research and innovation will be essential for the energy transition and that
adequate financial allocations, combined with clearly defined research and innovation objectives and
funding targets, are essential.

3.2 Public finances

Romania is currently (for reasons pertaining to pre-pandemic developments, see Annex 2) the only country
under the corrective arm of the Stability and Growth Pact:

• In April 2020, the Council adopted the decision to open an Excessive Deficit Procedure for Romania
and issued a recommendation on the adjustment path and the deadline (2022) to end the excessive
deficit situation.
• In June 2021, the EC proposed that the Council update its recommendation on the fiscal adjustment
path for Romania, targeting a correction of its excessive deficit in 2024. The Council adopted that
recommendation on 18 June 2021 and established the deadline of 15 October 2021 for Romania to
report in detail on action taken in response to the Council recommendation. Romania submitted its
report on 14 October 2021.
• In its November 2021 communication on the assessment of action taken by Romania, the
Commission underlined that the authorities have confirmed their commitment to ensuring a
correction of the excessive deficit as required by the Council. However, given the caretaker nature
of the government, the Commission stressed that the report on action taken contains only the
measures adopted with the aim of delivering compliance with the 2021 intermediate deficit target
and therefore expects the Romanian government, when formed, to present a budget for 2022 and

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IPOL | Economic Governance Support Unit

a medium-term fiscal strategy in line with the June 2021 Council recommendation as a matter of
urgency.
• The Commission, in its European Semester Spring 2022 package, considers that Romania's general
government deficit in 2021 and the fiscal effort in 2021 are in line with those recommended by the
Council. Against this background, the European Commission stresses that the procedure is kept in
abeyance and the CSR focused on the situation of public finances recommends for Romania to
“pursue fiscal policies in line with the Council Recommendation of 18 June 2021 with a view to bringing
an end to the situation of an excessive government deficit in Romania”.
Figure 7: Romanian deficit and debt to GDP ratio 2011-2021

60,0

47,2 48,8
50,0

37,6 39,2 37,8

40,0 37,1 37,3
34,0 35,1 34,7 35,3

30,0

20,0

10,0

0,0
-2,1 -1,2 -0,6
-3,7 -2,6 -2,6 -2,8 -4,3
-10,0 -5,4 -7,1
-9,3
-20,0
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Government consolidated gross debt Net lending (+) /net borrowing (-)

Source: Eurostat

The Romania Fiscal Council published in May 2022 its assessment of the situation of public finances
in Romania, focusing on the need to implement budget consolidation.
The Romania Fiscal Council recalls that, at the beginning of 2022, as a follow-up to its EDP, but also
given the situation of the economy itself, “which makes the trajectory of public debt unsustainable if
there is no correction, even gradual, given the magnitude of adverse shocks “, Romania had to make a
fiscal adjustment (a reduction of the budget deficit) of about 4 percent of GDP - from about 7.2% of
GDP deficit in 2021 to about 3% of GDP in 2024.. This would have to be implemented in the context of the
war in Ukraine, which involves, among other things, increased budget spending on defence, ensuring
energy and food security, protecting vulnerable households from rising energy prices, receiving and hosting
Ukrainian refugees, etc.
While the Romania Fiscal Council considers that the budget adjustment can only be gradual, “budget
consolidation is absolutely necessary” and “it must take place, be translated into credible measures,
have a strong political backing and support from broad economic and social circles - including the
business environment. In this context, it is absolutely necessary that decision-makers in the political and
administrative environment no longer promote tax cuts, as well as the increase in permanent expenditure at the
expense of temporary income.” The Romania Fiscal Council underlines that “it is clear that a large share of this
large-scale adjustment must come from increased fiscal and budgetary revenues, with budget expenditures on
an upward trend”.

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 Economic Dialogue with Romania

The Romanian Fiscal Council underscores that European resources from the NRRP (National Recovery and
Resilience Plan) and the MFF (Multiannual Financial Framework) represent the only countercyclical force
capable of counteracting the contractionary effects of fiscal consolidation. The absorption of a large part of
these financial resources, both grant and concessional, is vital for Romania, given the state of the public
budget and the vulnerabilities of the external balance, the extremely unfavourable international
environment.
Furthermore, the Romanian Fiscal Council published an opinion in August on the budget execution in the
first 6 months of the year following the publication by the Romanian government of a First Budget Revision
for 2022, underlining that this execution is taking place under extremely unfavourable auspices in the
European economy, with major implications for the Romanian economy, given the energy crisis linked to
the war in Ukraine, the disruption of production and supply chains, the almost universal high inflation, the
exacerbated effects of climate change, and the pandemic.
Analysing the changes made by the draft budget revision to the main revenue and expenditure aggregates,
the Romanian Fiscal Council estimates that the plausible budget deficit this year would be around 7%
of GDP (compared to 5.84% of GDP in the rectified budget projection). Moreover, if the government
has underestimated the impact of the expenditure related to the energy compensation measures,
which is likely, the deficit would inevitably increase considerably. And the unfavourable evolution of
market prices will put additional pressure on the budget.

3.3 Macroeconomic imbalances and vulnerabilities

Under the Macroeconomic Imbalance Procedure (MIP), based on the In-Depth Review for Romania, the
Commission considers that Romania is experiencing imbalances. Vulnerabilities relate to external
accounts, linked to large fiscal deficits, and to competitiveness issues that are re-emerging:
- The high current account deficit further worsened in 2021 and is not forecast to improve this year
or next. Large fiscal deficits pre-date the COVID-19 crisis and have driven up the current account
deficit which poses risks to external debt sustainability. Sovereign borrowing costs have increased
since early 2021.
- The expected acceleration in wages could weigh further on cost competitiveness. Nominal
depreciation could mitigate competitiveness losses but add to inflationary pressures and increase
the burden of serving debts in foreign currencies, which are significant for the government and the
private sector.
- The negative net international investment position is expected to remain below its pre-pandemic
levels. The external position is expected to benefit from significant RRF funds but external financing
can otherwise become more challenging amid tighter global financial conditions.
Recent policy initiatives, including the successful implementation of Romania’s RRP, can address some
vulnerabilities, still further action is needed to improve competitiveness and potential growth.

Disclaimer and copyright. The opinions expressed in this document are the sole responsibility of the authors and do not necessarily represent
the official position of the European Parliament. Reproduction and translation for non-commercial purposes are authorised, provided the source
is acknowledged and the European Parliament is given prior notice and sent a copy. © European Union, 2022.

Contact: egov@ep.europa.eu

This document is available on the internet at: www.europarl.europa.eu/supporting-analyses

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Annex 1: European Union - Key macroeconomic indicators

2018 2019 2020 2021 2022f 2023f
Real GDP growth – % change on previous year
Romania 4.5 4.2 -3.7 5.9 3.9 2.9
European Union 2.1 1.8 -5.9 5.4 2.7 1.5
GDP per capita – % change on previous year
Romania 5.1 4.7 -3.2 6.3 3.4 4.4
European Union 1.9 1.6 -6.0 5.4 1.6 1.9
General government budget balance – % of GDP
Romania -2.8 -4.3 -9.3 -7.1 -7.5 -6.3
European Union -0.4 -0.6 -6.8 -4.7 -3.6 -2.5
General government structural budget balance – % of potential GDP
Romania -3.1 -4.9 -7.8 -6.3 -6.5 -5.4
European Union -0.8 -1.2 -3.6 -3.6 -3.3 -2.5
General government primary budget balance – % of GDP
Romania -1.8 -3.2 -8.0 -5.7 -6.0 -4.7
European Union 1.3 1.0 -5.3 -3.3 -2.2 -1.2
General government gross debt – % of GDP
Romania 34.7 35.3 47.2 48.8 50.9 52.6
European Union 81.3 79.1 91.7 89.7 87.1 85.2
Interest expenditure on general government debt – % of GDP
Romania 1.0 1.1 1.4 1.4 1.5 1.6
European Union 1.7 1.5 1.4 1.4 1.3 1.3
Inflation (HICP) – % change on previous year
Romania 4.1 3.9 2.3 4.1 11.1 7.2
European Union 1.8 1.4 0.7 2.9 8.3 4.6
Unemployment – % of labour force
Romania 5.3 4.9 6.1 5.6 5.5 5.3
European Union 7.4 6.8 7.2 7.0 6.7 6.5
Total employment in persons - % change on previous year
Romania 0.1 0.1 -1.8 -8.9 0.8 0.8
European Union 1.5 1.1 -1.4 0.7 1.2 0.7
Current-account balance – % of GDP
Romania -4.4 -5.3 -5.8 -7.0 -7.5 -7.3
European Union, adjusted 2.7 2.3 2.4 2.4 2.1 2.6
Exports – % change on previous year
Romania 5.3 5.4 -9.4 12.5 4.5 5.2
European Union 3.8 3.0 -8.4 10.7 5.0 4.6
Imports – % change on previous year
Romania 8.6 8.6 -5.2 14.6 5.0 5.3
European Union 4.2 4.6 -8.2 9.3 5.0 4.7
Total investments – % change on previous year
Romania -1.1 12.9 4.1 2.3 4.8 8.1
European Union 3.4 6.5 -6.2 4.2 3.1 3.6
Labour productivity (real GDP per occupied person) – % change on previous year
Romania 4.4 4.1 -2.0 16.2 1.7 2.8
European Union 0.6 0.8 -3.3 4.6 1.2 1.5
Unit labour cost - nominal – % change on previous year
Romania 8.2 6.6 4.7 -9.0 6.4 4.1
European Union 2.2 2.0 4.6 0.0 2.5 2.2
Non-performing loans ratio in the banking sector (EBA) – % of total loans
Romania 5.2% 4.1% 3.7% 3.2% n.a. n.a.
European Union 3.2% 2.7% 2.6% 2.0% n.a. n.a.
Source: all indicators and forecasts (f) are European Economic Forecasts Spring 2022, if not indicated differently, with data extracted on
04/07/2022; the euro area is defined as variable composition (EA18-2014, EA19); the euro area general government gross debt is non-
consolidated for intergovernmental loans.

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 Economic Dialogue with Romania

Annex 2: Romania: Macroeconomic Imbalance Scoreboard

Indicators Threshold 2013 2014 2015 2016 2017 2018 2019 2020 2021

3 year average -3.5 -2.0 -0.7 -0.9 -1.8 -3.1 -4.2 -4.8 -5.7
-4/+6%
Current account balance
as % of GDP -1.0 -0.3 -0.8 -1.6 -3.1 -4.6 -4.9 -4.9 -7.3
Year value -

Net international investment position -63.6 -57.0 -54.7 -50.0 -47.8 -43.4 -43.4 -47.6 -47.2
-35%
as % of GDP
0.5 -1.0 2.7 -2.6 -5.6 -0.7 0.2 3.4 1.0
% change (3 years ) ± 5%
Real effective exchange rate -
External imbalances 42 trading partners 4.0 1.4 -2.6 -1.3 -1.8 2.3 -0.3 1.4 0.0
% change y-o-y -
and competitiveness
% change (5 years) -6% 13.9 20.9 21.3 24.5 38.0 23.4 17.4 19.9 10.6
Share of world exports
15.8 6.7 -0.1 8.9 2.8 3.5 1.5 1.9 0.5
% change y-o-y

0.9 9.4 3.9 11.3 17.6 28.7 24.0 20.7 14.4(p)

% change (3 years) 9%
Nominal unit labour cost
3.6 2.8 -2.5 11.0 8.7 6.7 6.9 5.8 1.2(p)
% change y-o-y -

-1.7 -3.2 1.7 5.2 3.3 1.7 -1.9 2.3 -1.1

House prices % change y-o-y deflated 6%

Private sector credit flow as % of GDP 14% -1.5 -2.3 0.2 0.6 1.7 1.9 2.0 1.3 3.8(p)

67.2 62.0 58.0 54.6 51.3 47.1 46.5 48.0 48.1(p)

Private sector debt as % of GDP 133%

General government gross debt 37.8 39.2 37.8 37.9 35.3 34.5 35.1 46.9 48.9
Internal imbalances (EDP concept) as % of GDP
60%

3 year average 10% 8.9 8.8 8.7 8.1 7.2 6.2 5.4 5.4 5.5
Unemployment rate
9.0 8.6 8.4 7.2 6.1 5.3 4.9 6.1 5.6
Year value -

Total Financial Sector Liabilities 0.8 1.2 4.1 7.0 8.2 3.4 10.3 13.4 14.3
16.5%
% change y-o-y , non-consolidated
Activity rate % 15-64 total pop. 0.5 1.7 2.3 2.3 3.0 2.5 3.1 2.3 3.2
-0.2%
(3 year change)
Employment Long-term unemployment active pop. 15-74 0.9 -0.2 -0.1 -0.5 -1.0 -1.4 -1.4 -0.6 -0.2
0.5%
indicators (3 year change).
Youth unemployment % active pop. 15-24 1.6 0.6 -0.9 -3.7 -7.0 -6.8 -4.9 -1.4 0.5
2%
(3 year change)
Source: Eurostat MIP Scoreboard indicators, data updated on 04 July 2022, see also AMR 2022.
Indicators above/ below the thresholds

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Annex 3: 2019, 2020, 2021 and 2022 Country Specific Recommendations

2019 CSRs Assessment in Assessment in Assessment in
RO SGP: CSR 1 May 2022
2020 CSRs
May 2022
2021 fiscal CSRs
May 2022
2022 CSRs
SGP: CSR 1 SGP: 1, 2, 3 SGP: -
MIP: CSR 1, 2, 3, (RRP coverage (RRP coverage (RRP coverage
MIP: CSR 4 MIP: - MIP: 1, 2, 3
5 of CSRs) of CSRs) of CSRs)
1. Ensure Limited Progress. 1. Pursue fiscal Limited Progress. 1. Pursue fiscal Limited Progress. 1. Pursue fiscal
CSR 1
compliance with the policies in line with policies in line with (Not applicable) policies in line with
Council the Council’s the Council the Council
recommendation of recommendation of Recommendation of Recommendation of
14 June 2019 with a 3 April 202010 , 18 June 2021 with a 18 June 2021 with a
view to correcting while taking all view to bringing an view to bringing an
the significant necessary measures end to the situation end to the situation
deviation from the to effectively of an excessive of an excessive
adjustment path address the government deficit government deficit
toward the medium- pandemic, sustain in Romania. in Romania.
term budgetary the economy and
objective. Ensure the support the ensuing
full application of recovery. Avoid the
the fiscal framework. implementation of
Strengthen tax permanent
compliance and measures that would
collection. endanger fiscal
sustainability.
Split into Sub-CSRs Strengthen the
resilience of the
health system,
including in the
areas of health
workers and medical
products, and
improve access to
health services.

Split into Sub-CSRs

• Ensure Not relevant • Pursue fiscal Not relevant
compliance with anymore policies in line anymore
the Council (Not applicable) with the (Not applicable)

18 PE 733.725
 Economic Dialogue with Romania

recommendatio Council’s
n of 14 June recommendatio
2019 with a view n of 3 April 2020,
to correcting the while taking all
significant necessary
deviation from measures to
the adjustment effectively
path toward the address the
medium-term pandemic,
budgetary sustain the
objective. economy and
support the
ensuing
recovery.
• Ensure the full No progress • Avoid the Limited progress
application of (NOT ADDRESSED) implementation (Relevant RRP
the fiscal of permanent measures being
framework. measures that implemented as of
would endanger 2021 and planned as
fiscal of 2022)
sustainability.
• Strengthen tax Limited progress • Strengthen the Limited progress
compliance and (Relevant RRP resilience of the (Relevant RRP
collection. measures being health system, measures being
planned as of 2022) including in the implemented as of
areas of health 2021 and planned as
workers and of 2022)
medical
products, and
improve access
to health
services.
2. Safeguard Some Progress. 2. Provide adequate Limited Progress. 2. Proceed with the
CSR 2
financial stability income replacement implementation of
and the robustness and extend social its recovery and
of the banking protection measures resilience plan, in
sector. Ensure the and access to line with the
sustainability of the essential services for milestones and
public pension all. Mitigate the targets included in

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IPOL | Economic Governance Support Unit

system and the long- employment impact the Council

term viability of the of the crisis by Implementing
second pillar developing flexible Decision of 3
pension funds. working November 2021.
arrangements and Swiftly finalise the
Split into Sub-CSRs activation measures. negotiations with
Strengthen skills and the Commission on
digital learning and the 2021‒2027
ensure equal access cohesion policy
to education. programming
documents with a
Split into Sub-CSRs view to starting their
• Safeguard Substantial • Provide Substantial implementation.
financial progress adequate progress
stability and the (NOT ADDRESSED) income (NOT ADDRESSED)
robustness of replacement
the banking and
sector.
• Ensure the Limited progress • extend social Limited progress
sustainability of (Relevant RRP protection (Relevant RRP
the public measures being measures and measures planned
pension system implemented as of as of 2022)
and 2021 and planned as
of 2022 and 2023)
• the long-term Some progress • extend access to Limited progress
viability of the (NOT ADDRESSED) essential (Relevant RRP
second pillar services for all. measures being
pension funds. implemented as of
2021 and planned as
of 2022 and 2023)
• Mitigate the Limited progress
employment (Relevant RRP
impact of the measures planned
crisis by as of 2024)
developing
flexible working
arrangements
and activation
measures.

20 PE 733.725
 Economic Dialogue with Romania

• Strengthen skills Limited progress

and digital (Relevant RRP
learning and measures planned
as of 2022)
• ensure equal Limited progress
access to (Relevant RRP
education. measures being
implemented as of
2021 and planned as
of 2022 and 2023)
3. Improve the Limited Progress. 3. Ensure liquidity Limited Progress. 3. Reduce overall
CSR 3
quality and support to the reliance on fossil
inclusiveness of economy for the fuels. Facilitate the
education, in benefit of businesses further expansion of
particular for Roma and households, sustainable energy
and other particularly SMEs production by
disadvantaged and the self- accelerating the
groups. Improve employed. Front- development of
skills, including load mature public renewables,
digital, notably by investment projects upgrading energy
increasing the and promote private transmission grids
labour market investment to foster and increasing
relevance of the economic interconnection
vocational recovery. Focus with neighbouring
education and investment on the Member States.
training and higher green and digital Increase the pace
education. Increase transition, in and ambition of
the coverage and particular on renovations to
quality of social sustainable advance the energy
services and transport, digital efficiency of the
complete the service building stock.
minimum inclusion infrastructure, clean
income reform. and efficient
Improve the production and use
functioning of social of energy and
dialogue. Ensure environmental
minimum wage infrastructure,
setting based on including in the coal
objective criteria, regions.

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IPOL | Economic Governance Support Unit

consistent with job

creation and Split into Sub-CSRs
competitiveness.
Improve access to
and cost-efficiency
of healthcare,
including through
the shift to
outpatient care.

Split into Sub-CSRs

• Improve the Limited progress • Ensure liquidity Full
quality and (Relevant RRP support to the Implementation
inclusiveness of measures being economy (Relevant RRP
education, in implemented as of benefiting measures being
particular for 2021 and planned as businesses and implemented as of
Roma and other of 2022) households, 2021 and planned as
disadvantaged particularly of 2022)
groups. small and
medium-sized
enterprises and
the self-
employed.
• Improve skills, Limited progress • Front-load Limited progress
including (Relevant RRP mature public (Relevant RRP
digital, notably measures planned investment measures planned
by increasing as of 2022) projects and as of 2022 and 2023)
the labour
market
relevance of
vocational
education and
training and
higher
education.
• Increase the Limited progress • promote private Some progress
coverage and (Relevant RRP investment to (Relevant RRP
quality of social measures planned foster the measures being
services as of 2022) implemented as of

22 PE 733.725
 Economic Dialogue with Romania

economic 2021 and planned as

recovery. of 2022)
• Complete the Limited progress • Focus Limited progress
minimum (Relevant RRP investment on (Relevant RRP
inclusion measures planned the green and measures being
income reform. as of 2022) digital implemented as of
transition, in 2021 and planned as
particular on of 2022)
sustainable
transport,
• Improve the Limited progress • digital service Limited progress
functioning of (Relevant RRP infrastructure, (Relevant RRP
social dialogue. measures planned measures being
as of 2022) implemented as of
2021 and planned as
of 2022 and 2023)
• Ensure Limited progress • clean and Limited progress
minimum wage (Relevant RRP efficient (Relevant RRP
setting based on measures planned production and measures being
objective as of 2024) use of energy implemented as of
criteria, and 2021 and planned as
consistent with environmental of 2022 and 2023)
job creation and infrastructure,
competitiveness including in the
. coal regions.
• Improve access Limited progress
to and cost- (Relevant RRP
efficiency of measures being
healthcare, implemented as of
including 2021 and planned as
through the of 2022 and 2023)
shift to
outpatient care.
4. Focus investment- Some Progress. 4. Improve the Limited Progress.
CSR 4 related economic quality and
policy on transport, effectiveness of
notably on its public
sustainability, low administration and
carbon energy and the predictability of

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IPOL | Economic Governance Support Unit

energy efficiency, decision-making,

environmental including through
infrastructure as well an adequate
as innovation, taking involvement of
into account social partners.
regional disparities.
Improve preparation Split into Sub-CSRs
and prioritisation of
large projects and
accelerate their
implementation.
Improve the
efficiency of public
procurement and
ensure full and
sustainable
implementation of
the national public
procurement
strategy.

Split into Sub-CSRs

• Focus Some progress • Improve the Some progress
investment- (Relevant RRP quality and (Relevant RRP
related measures being effectiveness of measures planned as
economic policy implemented as of public of 2022 and 2023)
on transport, 2021 and planned as administration
notably on its of 2022 and 2023) and
sustainability,
low carbon
energy and
energy
efficiency,
environmental
infrastructure as
well as
innovation,
taking into
account

24 PE 733.725
 Economic Dialogue with Romania

regional
disparities.
• Improve Some progress • improve the Limited progress
preparation and (Relevant RRP predictability of (Relevant RRP
prioritisation of measures being decision- measures being
large projects implemented as of making, implemented as of
and accelerate 2021 and planned as including 2021 and planned as
their of 2022 and 2023) through an of 2022)
implementation adequate
. involvement of
• Improve the Some progress social partners.
efficiency of (Relevant RRP
public measures planned
procurement as of 2023)
and ensure full
and sustainable
implementation
of the national
public
procurement
strategy.
5. Ensure that Limited Progress.
CSR 5
legislative initiatives
do not undermine
legal certainty by
improving the
quality and
predictability of
decision-making,
including by
appropriate
stakeholder
consultations,
effective impact
assessments and
streamlined
administrative
procedures.
Strengthen the

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IPOL | Economic Governance Support Unit

corporate
governance of state-
owned enterprises.

Split into Sub-CSRs

• Ensure that Limited progress
legislative (Relevant RRP
initiatives do not measures being
undermine legal implemented as of
certainty by 2021 and planned as
improving the of 2022)
quality and
predictability of
decision-
making,
including by
appropriate
stakeholder
consultations,
effective impact
assessments
and streamlined
administrative
procedures.
• Strengthen the Limited progress
corporate (Relevant RRP
governance of measures being
state-owned implemented as of
enterprises. 2021 and planned as
of 2022 and 2023)

26 PE 733.725