New PM Faces Uphill Challenge in Romania

Romania is bracing for a period of political uncertainty following the resignation of Prime Minister Emil Boc after weeks of protests against his tough austerity measures.

Boc announced he was quitting early on Monday amid continuing political and social unrest. "I took the decision to step down in order to take the strain off the political and social situation in the country, and also in order for Romania not to lose what it has earned - economic stability," he said.

Boc, who had headed the government since 2008 and had survived ten no-confidence motions, urged the political class to rapidly form a new administration. But this may be a difficult task.

Later on Monday, President Traian Basescu named Mihai Razvan Ungureanu, head of Foreign Intelligence Agency, SIE, as Prime Minister. The proposal came hours after Basescu named Boc’s justice minister, Catalin Predoiu, as interim premier.

Ungureanu will start negotiating with the governing coalition to create a new ministry that will then be submitted to parliament for approval.

Ungureanu, 44, was foreign minister from 2004 to 2007 and has been head of the country’s intelligence agency since 2007.

He was a member of the opposition Liberal Party, PNL, but suspended party membership in 2007 as political activity is incompatible with running the foreign intelligence agency.

While President Basescu has opted to name a person without political affiliation as premier, the leftist opposition is pushing hard for an early general election.

"The resignation of the Boc government is a first step to solving the political crisis. It opens the road to anticipated elections - the only solid, democratic formula to return Romanian political life to normality," Crin Antonescu, leader of the opposition PNL, said.

But the coalition of opposition parties of Social Democrats and Liberals lacks the majority in parliament that it needs to force an election.

Political analyst Adrian Patrascu said Basescu, who comes from Boc's centrist Democrat-Liberal Party, is likely to secure parliamentary backing for his nominee.

The current coalition – comprising Boc's Democrat Liberals, the main ethnic Hungarian party, UDMR, and a grouping of independents – has rejected calls for an early poll, saying elections are scheduled for this November anyway.

Experts say that the main task of any government should be to maintain the pace of reform agreed together with the International Monetary Fund, IMF.

“The next government must stand by these reforms, there is no other option for Romania”, economist Adrian Vasilescu said.

Romania is dependent on a 20 billion euro rescue package from the IMF, the European Union and the World Bank. It obtained the loan in May 2009 in exchange for agreeing to push through austerity measures aimed at taming the country’s deficit.

In July 2010 the government cut civil servants' wages by 25 per cent, while thousands of state jobs were axed and VAT was increased by five percentage points to 24 per cent.

Falling wages and the effects of the austerity measures prompted thousands of people to take to the streets across the country over the past month, demanding the resignation of both the government and Basescu.

The protests have stopped in recent days as snow and chilly winds have deterred many Romanians from going outdoors.