The good, the bad and the muddly

Date: 22/11/03

Question marks over Bulgaria and Romania

SAY what you like about the current Romanian government, the alternative would have been worse. When the ex-communist Social Democrats won the general election in November 2000, the runner-up was the Greater Romania Party, probably the furthest-right party to sit in any European parliament in the past 50 years. Its leader, Corneliu Vadim Tudor, has compared himself admiringly to Marshal Antonescu, the pro-Nazi wartime leader of Romania, and to the country's more recent dictator, Nicolae Ceausescu.

Mr Vadim Tudor was also the runner-up in the 2000 presidential election, and opinion polls suggest that he may do at least as well in the next one, which is due to be held late next year. Ion Iliescu, the veteran ex-communist who has held the president's job for most of the past decade, will be barred by the constitution from running again.

The politics in neighbouring Bulgaria are less extreme, but scarcely less eccentric. The ruling party, the National Movement Simeon II, was thrown together in haste before the general election of July 2001 as a vehicle for ex-King Simeon Saxe-Coburg, who returned to Bulgaria after his expulsion by the communists 45 years earlier at the age of nine. The Movement won the election handsomely, buoyed up by Simeon's promise to improve living standards in 800 days. When that failed to happen to voters' satisfaction, support for the ex-king's party fell sharply.

Freedom House, an American think-tank, gives Bulgaria and Romania mediocre ratings for their performance in areas such as the holding of free and fair elections, the rule of law, the independence of the press, the quality of law-making and the honesty of the public services. They can be classed as democracies, but not ones in which the democratic processes have consolidated, it says. On this reckoning Bulgaria and Romania are more like Serbia or Albania than they are like Hungary or Poland.

Economists are more upbeat. The IMF says Bulgaria and Romania have both been doing rather well. In July it called Bulgaria's record “excellent”. In October it praised the Romanian government's “sound macro-economic policies and progress in structural reforms”. It says both countries' economies should go on growing for the next four or five years at an annual rate of 5% or more.

From which side should the European Union take its cues? It has told Bulgaria and Romania that they can join the Union in 2007 if they are “ready” to do so. By “ready”, it means that they should have functioning market economies, stable democracies and the administrative and judicial capacities needed to enforce EU laws. Neither country is there yet. If the EU does plan to admit them in 2007 it will have to conclude the detailed negotiations by the end of next year and sign accession treaties with them in 2005. It has about a year to guess if they will make the grade.

The European Commission gave an interim view of the progress being made by Romania and Bulgaria in reports published on November 5th. It found that much remained to be done in both countries, but it was more encouraging towards Bulgaria. It reserved its more serious criticisms for Romania, including the view that Romania had not yet proved itself as a “functioning market economy”, a precondition for EU membership.

On balance, the commission seems right to have credited Bulgaria with greater progress. The country has plenty of problems, including a succession of governments addicted to regulation and red tape. But it has been going fairly reliably in the right direction since 1997, when bad economic policy pushed it to the brink of financial crisis. A general election gave voters the chance to throw out the ex-communists who had made the mess, and to install instead the most successful reformist government south-eastern Europe had seen. Inflation was quashed, the currency pegged, the banking system rescued.

When the 2001 election came round, fatigue with the perceived hardships of reform turned many voters to ex-king Simeon, who has been doing a fair job. His government has been slow with some institutional reforms, including vital judicial ones, but more through inefficiency than through any wish to block them.

Romania has been making strides too, but the politics there do not inspire quite the same hope. It is not the baleful presence of the Greater Romania Party alone which counts against the country, though it does cast a long shadow: the EU's worst nightmare would be to put an accession treaty on the table in 2005 and find President Vadim Tudor waiting to sign it. If anything, the political situation is improving slightly at the level of parties and policies. The ruling Social Democrats are talking less like nostalgic ex-communists and more like a modern, business-friendly party. The next election may well broaden their minds a bit further by forcing them into a coalition with one or both of the country's main centrist parties, the Liberals and the Democrats, which have been reviving under new leaders.

The Romanian economy is doing so well that the EU may even be a little harsh in its reluctance to recognise it as a “functioning market economy”. In some respects the market economy might even be said to function excessively well. There seems to be almost nothing, and nobody, in the public or private sectors, that cannot be bought for the right amount of cash.

The big problem for Romania is the rule of law, or lack of it. A survey conducted by Transparency International, an NGO, found this year that Romania was widely considered one of the most corrupt countries in the world, let alone in Europe. Property rights are weak. The public prosecutor has excessive powers. The judiciary is dominated by time-servers from the communist era. Last year the European Commission expressed “serious concerns” about judicial independence, and called for “comprehensive reform”, but far too little has been done since, says the Romanian Academic Society, a think-tank.

European leaders decided to let Greece into the club before it was ready, in 1981, partly on the grounds that membership would safeguard Greek democracy whereas exclusion might put it at risk. They could justify a similar view of Romania now, but they are not likely to do so. Romania has less sentimental appeal than Greece did 20 years ago, and the EU has plenty of enlargement on its plate without looking for more countries to add.

The greater doubt is whether an enlargement will happen at all in 2007, if Bulgaria alone is deemed acceptable by then. The EU might propose waiting another two or three years to give Romania some breathing space and to give Croatia, the next would-be candidate, a chance to catch up. This would be tough on Bulgaria - and unfair too, since the EU claims to treat each applicant on its merits. But on the positive side, the longer Bulgaria waits, the more the EU will be reshaped by the demands of the countries joining in 2004. Each passing year will make it a more diverse and broadminded club in which Bulgaria, and other new members, will feel much more at home.

Question marks over Bulgaria and Romania. Article is part of a survey 'When east meets west: a survey of EU enlargement'.