Talks have stalled among Romania’s pro-European parties over the formation of a new government with the East European country risking billions in EU funds ahead of a key deadline.
The four pro-European parties have failed to form a governing coalition or present a draft plan to reduce the budget deficit of 9.3 % the highest in the EU. Parties have not agreed on a candidate for prime minister and have discussed the possibility of a government of technocrats.
In an effort to break the deadlock, party representatives met with President Nicușor Dan on Thursday.
The parties_ the Social Democrats, (PSD), the Liberals, USR (Renew), and the Hungarian minority party UDMR have until 20 June to reach an agreement, when the mandate of the interim government led by Liberal Prime Minister Cătălin Predoiu expires.
If Bucharest fails to adopt and submit a plan for spending cuts and increased revenues to the European Commission by 30 June, the country risks losing significant funding from the EU’s Recovery and Resilience Facility.
The initial set of deficit-reduction measures was expected by June 9, but divisions between the parties have stalled progress. The Social Democrats are pushing for tax hikes while the USR wants to cut public spending.
Talks have also broken down over the appointment of a prime minister. President Dan, the Liberals and the USR support Ilie Bolojan for the position. The Social Democrats are unwilling to cede the position entirely, arguing that as Romania’s largest party, it should share the role in a rotating system, first with a Liberal prime minister, followed by a Social Democrat.
Romania is scheduled to next hold parliamentary elections in 2028.
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