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Tuesday, September 21, 2004

Romanian National Bank and the politics behind it

BUCHAREST, Sept 20 (Reuters) - Romania's opposition parties on Monday slammed
a parliamentary decision to appoint a new central bank (BNR) board before
November elections, saying the governing Social Democrats were trying to put
their own people in key posts.

They will ask for the procedure to be postponed until after the polls.

Parliament last week launched procedures to appoint a new BNR board ahead of
Nov. 28 presidential and parliamentary polls -- about a month earlier than
expected -- sparking a row on whether the mandate of the current BNR board had
expired.

"We will ask parliament to wait until the current board's mandate expires,
after the elections," opposition Liberal party spokesman Eugen Nicolaescu told
Reuters.

The current BNR board, headed for most of the post-communist years by
governor Mugur Isarescu who has said he is keen to win a new term, was appointed by
parliament in mid-December 1998.

On Monday, officials from parliament said the BNR's board mandate expired
because new legislation -- which strengthens central bank independence in line
with EU standards and cuts its board term to five years from six -- was adopted
in July.

They said a new BNR board might be appointed next week.

Under the law, parliament's budget and finance commissions propose the bank's
nine-member board which is then approved by majority at a joint lower house
and senate assembly.

The Liberals, which has joined forces with the Democrats to face the
ex-communist Social Democrat Party (PSD) in November, said the move signals the PSD's
eagerness to secure jobs for its supporters while it still dominates the
current parliament.

Latest opinion surveys show the opposition gaining ground ahead of elections
but PSD still leads in voter preferences.

Analysts said Isarescu's job was unlikely to be challanged. He has led the
bank for almost 14 straight years -- except for his one-year as a caretaker
prime minister in 2000.

Posted by Mihai : 9/21/2004 01:40:00 pm