Talks on a new government in Romania ended in yet another deadlock on Thursday, preventing the expected announcement of a nominee for prime minister.
The deadlock centers around the VAT issue. Raising the VAT from 19% to at least 21% is among the proposed measures to reduce the budget deficit. However, the plan has faced strong public backlash. President Nicușor Dan had pledged during his campaign that VAT would remain unchanged throughout his term. In contrast, Ilie Bolojan – widely seen as the leading candidate for prime minister – insists that the VAT increase is necessary.
The two held further talks on Thursday evening in an attempt to break the impasse.
Meanwhile, tensions also persist with the Hungarian minority party, UDMR. Its president, Kelemen Hunor, said that the party will make a final decision on whether to join the government on Friday.
During negotiations among the four parties expected to form a pro-European coalition – PSD, PNL, USR, and UDMR – the UDMR was offered the Ministry of Development and Culture. However, the party leadership rejected the proposal, seeking instead to retain control of the Ministry of Finance.
Kelemen Hunor also noted that a government could be formed without UDMR, saying the party no longer feels welcome in the coalition.
Reflecting the growing frustration, interim Finance Minister Tánczos Barna announced that he would not attend Friday’s ECOFIN meeting, where Romania is due to present its deficit-reduction plan.
“We still don’t know who will attend ECOFIN. One thing is certain: Romania will be represented by someone who, on behalf of the Finance Ministry, will present the package of measures prepared by the new coalition,” Barna said Thursday.
(Catalina Mihai, Euractiv.ro)