Romania PM quits in response to protests

By Ioana Patran and Sam Cage, Reuters

BUCHAREST–Romanian Prime Minister Emil Boc resigned on Monday, giving way to mass protests against IMF-backed austerity measures and joining leaders of other European Union states felled by fury at spending cuts.

President Traian Basescu named Boc’s justice minister, Catalin Predoiu, to replace him at the head of a government whose popularity is languishing in opinion polls ahead of a parliamentary election to be held by November at the latest. The International Monetary Fund (IMF), which bailed out Romania in 2009 with a 20-billion-euro (US$26 billion) loan on condition of deep cuts in government spending, said it did not expect the deal to be affected by Boc’s departure. The cabinet will remain in place under Predoiu in a caretaker capacity until Basescu, who has often used his notionally figurehead post to play a significant role in politics, decides whether to ask Predoiu — or someone else — to form a new government that can secure a majority in parliament. While the leftist opposition is calling for an early general election, its lack of a majority in the current legislature means that the president, who comes himself from Boc’s centrist Democrat-Liberal Party (PDL), is likely to be able to secure parliamentary backing for his eventual nominee.

Whatever happens, the IMF mission chief in Bucharest, Jeffrey Franks, told Reuters: “I see no reason necessarily for this to have a material effect on the aid agreement. We have every expectation the agreement will continue.” Committed at some stage to adopting the euro single currency under the terms of its accession to the EU in 2007, Romania is the 27-nation bloc’s second poorest member and is still struggling with the economic legacy of communist state control.

It was forced to seek IMF aid in 2009 to maintain investor confidence, prevent a run on the currency and keep borrowing costs at sustainable levels, even though its public debt to gross domestic product ratio was the fourth lowest in the EU.