November - 2005



EU: Targeting corruption is high priority

Implementing anti-corruption measures must speed up in order for Romania and Bulgaria to secure entry on 1 January 2007, says the latest EU Monitoring Report, but the outlook for Romania's chance of joining on time is broadly positive.
            This fight, along with improving the situation of minorities, the managing of the borders and public administration reform were called for in the report.
            “Border management and corruption” will play a direct role in the Commission's decision whether or not to recommend delay, said Jonathan Scheele, head of the Delegation to the European Union.
            If reforms fail to be implemented, the EU will also have no hesitation to use the safeguard clause, delaying  entry by one year, said EU Enlargement Commissioner Olli Rehn in Bucharest recently.
            In reforming justice, Rehn said the “courts need to work faster” and “need budgetary support”. However EU Commissioner for Justice Franco Frattini said recently that Romania has “enough time” to implement its justice reform laws.
            The EU's Comprehensive Monitoring Report assesses whether the prospective EU nation has achieved its political and economic criteria for EU entry.
            A similar report will be released in April 2006. After this, a final decision on whether or not to delay Romania's EU entry will be made.



- Stopping widespread human traffic
- Public administration and civil service reform
- Prosecution of the powerful corrupt
- Conditions of disabled and mentally ill
- Inefficiency of state enterprises
- Conditions of Rroma minority
- Fight against piracy and counterfeiting
- Customs control on new EU border
- Ill-treatment in custody
- Preparations for joining Schengen area
- State aid reform


- Justice restructuring
- Legislating anti-corruption measures
- Child protection care
- Freedom of expression
- Press independence
- Restitution of property
- Tax revenue collection
- Conditions of Hungarian minority
- Enforcing competition rules


- Economic growth
- Banking and services sector reform
- Energy, mining and transport restructuring
- Telecom liberalisation



Gold mine still held back by defiant protests

Rosia Montana Gold Corporation has six hundred million Euro ready to invest in a controversial open-cast gold mine in Alba county, but NGOs resident in the area will not leave without a fight

            Canadian-based Gabriel Resources and Rosia Montana Gold Corporation (RMGC) are mounting a new attempt to excavate the Rosia Montana Valley in Alba county for massive gold reserves.
            But until they can buy up the entire village on the site of the reserves, they will struggle to build an open-cast mine.
            “If it does not go ahead, the biggest loss will be to Romania and the Romanians,” says Raphael Girard, former Canadian Ambassador to Romania and a new director of RMGC.
            But non-Governmental organisa-tions against irresponsible mining in the area pose a firm challenge.
            “The mining project remains failed,” says Stephanie Roth, a volunteer from NGO Alburnus Maior.
            The new RMGC team comes with experience of dealing with international large scale mining projects.
            However a number of these, notably the Bulyanhulu Gold Mine in Tanzania, have run into controversy over alleged forced relocation of residents.
            “We have built mines before and we want to focus on bringing Rosia Montana to production,” says Alan Hill, new CEO of RMGC. Hill says the mine is “not for sale” and his firm could be cutting gold from the valley by 2009.
            But the new team does not change the situation, says Roth. “This is a cosmetic solution,” she adds. “Gabriel Resources has changed its teams two or three times. The problems prevail.”
            Press reports and active NGOs in the past have depicted the firm as profit-hungry opportunists blasting apart the beautiful, historical and populated Romanian countryside and poisoning the landscape with cyanide.
            “Rosia Montana does not have a good name, which I will correct,” says Hill. The company wants to communicate a positive message which foregrounds employment opportunities for the area. “If we can get everyone to neutral,” says Hill, “that will have been a good start.”
            The Alba county mine has the tenth largest undeveloped gold deposits in the world and could be the biggest gold mine in Europe, says Hill. 10.6 million ounces of gold reserves and 52.3 million ounces of silver could be excavated from the area, on top of untested resources.


            RMGC has carried out a policy of buying up the Rosia Montana village and relocating the citizens to a new site. So far the company has bought out 42 per cent of the houses. Hill says his company has a commitment to buy the remainder by 2006. On what would happen if some refused to abandon their properties, Hill said: “The indications are from people that they all want to leave and relocate… Some are holding out for a higher price.”
            But Roth dismisses this.
            “There are still many who do not want to leave and relocate,” she says. “If Gabriel Resources wants to operate it will have to purchase all the properties. That will never be possible. I have a house here. It is not for sale.”
            Roth argues that some villagers have two or three houses. They have sold one to Gabriel Resources and, with the money, have bought double glazing or washing machines for their other two residences.  “They have not moved out of the village,” she says.
            It is not within Gabriel Resources' power to evict people. Unless they leave, mining cannot begin.  “We will see if the investors can hold out,” says Roth.
            Hill expects to get approval on an environmental impact assessment (EIA) by September 2006. Roth believes that the EIA will “99 per cent” give Gabriel Resources permission to mine. At that point, Roth says her team will then take them to court.
            Construction of the mine could start in early 2007 and boring of the gold in 2009. This is a five-year delay from the originally proposed start-date of 2004. RMGC expects the mine to have a 20 year life span.
            The predicted total cost of the investment for the project would be around 600 million Euro, financed by debt and equity, the debt from large European banks. The company expects profits of around 730 million Euro, with 20 per cent going to the Romanian Government and 80 per cent to RMGC.
            Hill says the employment opportunities would be great for an area with chronic job shortages. Loss-making state mining company Minvest currently operates an open pit mine around the site of Rosia Montana, which must close  before December 2006 as a condition of EU entry.
            RMGC predicts this will force unemployment up to 90 per cent in the area, unless mining continues in private hands. But NGOs argue that a greater number in the Rosia Montana region are engaged in agriculture and forestry vocations than in mining.
            For a way out of this impasse, Roth does not rule out a compromise. “We are not against economic development,” she says. “We are against irresponsible mining.”
            But she argues that Gabriel Resources is looking to maximise the amount of gold from this area.
            “Either they go or we go,” Roth says.



Shake the disease

Growing inequality means authorities cannot be complacent about stopping the threat of AIDS, Anca Pol finds as she talks to UN AIDS expert Elhadj Amadou Sy

            With the latest United Nations report confirming the gap between rich and poor is increasing in Romania, society must watch whether this could trigger more incidences of AIDS.
            Elhadj Amadou Sy, director of the Bureau for Development Policy of the HIV/AIDS Group, part of the United Nations Development Programme (UNDP), has seen such warning signs in developing countries.
            “The disparities between rich and poor, between rural and urban areas, between men and women induce social vulnerability may lead to an increase of the HIV incidence,” Sy tells The Diplomat.
            In this inequality the more vulnerable seek for “survival strategies”, such as women engaging in prostitution, says the expert
            Another important Romanian characteristic is the gap between rural and urban development.
            Sy says that when young men from the countryside leave the villages for cities, they sometimes find themselves “in a context of anonymity”. There are more chances they will take illegal drugs such as heroin. “A lack of control feeds the epidemic,” he adds.
            Prevention strategies are no different from other developing countries. “Test all the blood samples, use safe injections, take care of the population in the margins of the society, give them opportunities to develop themselves and thus you will keep the level of danger low,” he says.
            Doctor Cristian Andrei believes it is high time Romanian HIV awareness campaigns upgraded. He believes HIV prevention begins with effective sex and anti-drug education using the means close to the youth's experience, such as multimedia and Internet tools. “We shouldn't limit ourselves to just going in schools with boxes of condoms and giving them to the students. Instead, we need to have informal, friendly meetings with them,” he told The Diplomat.
            Since 1994, Romanian HIV cases have been mainly sexually transmitted with fewer related to intravenous drug use. According to UNAIDS, the country is one of the few countries in central and eastern Europe with a large number of people affected by HIV and AIDS. By the end of 2003, Romania counted 44 HIV cases per 100,000 inhabitants. In the late 1980s thousands of children were infected with HIV as a result of unsafe medical procedures. Many such cases arose in the crowded and filthy orphanages of the Communist era.
            Sy says “progress has been made” in Romania. In 2004 the country launched a four-year National Anti-AIDS Strategy to maintain the same number of cases from 2002 until 2007. This intends to develop economic patterns that keep people in their original environment and “balanced, homegrown development”. This is similar to the European Union's targeting of undeveloped regions, rather than allowing poverty to force people to travel far for work. However with two million Romanians working abroad, this is not happening.
            Also when large cities grow rapidly, a lack of jobs appears at the margins of the society. This situation can promote poverty and criminality, chief drivers for HIV.
            “Ghettoisation brings insecurity even for those who are better off,” Sy says, “and when there is insecurity, there is a growth in HIV infection cases.”



Britain called to take on more local opportunities

British firms in Romania should step up a gear, says the UK voice of Business. Michael Bird reports

            British banks and retailers should be seen in Romania, according to Sir Digby Jones, director-general of the Confederation of British Industry, the voice of British business interests.
            Jones, who calls Romania 'Britain's best friend' says the UK has world-class abilities in mobile telephones, aerospace, pharmaceuticals, financial services, retail and academia.
            But only pharmaceuticals, with firms such as GlaxoSmithKline and Ozone, and mobile telephones, with Vodafone, are present in Romania.
            “British business has to come here with retailers and banks,” Jones told The Diplomat on a recent visit to Romania for a Conference on the Lisbon Strategy, where he met British Embassy officials and the British-Romanian Chamber of Commerce ( BRCC).
            None of the nation's four largest banks, HSBC, Royal Bank of Scotland, Barclays and Lloyds, are present in Romania. Neither are any of the major retailers, such as Tesco, electronics group DSG International or DIY specialists Kingfisher.
            All of these retailers have a presence in eastern Europe.
            Royal Bank of Scotland told The Diplomat that the bank had no interest in coming to Romania. A spokesman added that the European Union accession in 2007 for Romania would make “no difference” to this strategy.
            Part of the reason for retailers' reluctance is the lack of infrastructure.
            “Bad roads are a problem,” Jones said. “You can't get goods to market. Let me give you an example: Tesco can pick a lettuce in the east of the UK, wash it and bag it and transport it to the west in one morning.”
            He also says Romania needs a better image in Britain, because it is seen as a corrupt country: “But it is not as bad as they say it is.” The 50 year-old director general said that when the Romanian authorities catch someone for corruption: “Tell everyone. Tell all the news agencies.”
            Calling Romania a potentially competitive threat in Europe, Jones said the country has a well-educated workforce, especially in science. “Also a good work ethic,” he said. “Romanians work hard.”
            In attracting investment from abroad, quality is something Romania should foreground. Jones added: “People won't only come to Romania because it's cheap.”