Leibniz Universität Hannover

M.A. Studiengang European Studies

Praxis- und Kompetenzmodul
Leitung: Nora Langerock
Wintersemester 2008/09

Approaching the third year of EU membership:

Corruption in Romania still a problem - does the current
governance system facilitate local corruption?
06.12.2008

Yvonne Eich
Callinstr. 25 / WG 44-1
30167 Hannover
Yvonneeich@hotmail.com
Table of contents

1. Introduction…………………………………………………………………………..1
2. Increase in local corruption: A proof for systemic corruption?..........................2
3. Which perspective of regionalization to fight local corruption?.........................3
4. Conclusion……………………………………………………………………………6
5. List of References……………………………………………………………………6

i
Introduction

Romania, together with Bulgaria being one of the two newest members of the
European Union (EU), has still to hassle with a lot of problems becoming truly
“European”. With entering the membership of the EU, Romania, as a former
communist country, was challenged by the need of implementing a comprehensive
reform of its economy and to build a powerful institutional set up, which could give
the new democratic order a sufficient level of legitimacy and stability. In December
2006 the European Commission established a “Co-operation and Verification
Mechanism” (CVM) with a set of 4 benchmarks, to help Romania to make progress in
the fields of judicial reform, corruption and organised crime which Romania has
agreed to.1 Nearly two years after its accession no sufficient progress towards these
benchmarks could be made, stated also in the biannual report of the European
Commission.2 This work looks at the problems tackling local corruption in Romania
referring to the progress already made towards the loosely formulated 4th benchmark
of the CVM: “Take further measures to prevent and fight against corruption, in
particular within the local government.”3 Further more I will outlay the attributes of
systemic corruption in Romania and then trying to establish a connection between
regionalization and its ability to fight local corruption with establishing a better
working multi-level governance system in Romania. A good working of this system
could be proofed to be an important precondition for fighting corruption.4

1
cf. European Commission (ed.): Assessing ongoing process by Bulgaria and Romania,
http://ec.europa.eu/dgs/secretariat_general/cvm/index_en.htm, 13.10.2008, viewed on 30.11.2008.
2
European Commission (ed.): Report on Progress in Romania under the Co-operation and Verification
Mechanism, http://www.eubusiness.com/Romania/romania-progress.08/, 23.07.2008, viewed on
30.11.2008.
3
ibid.
4
cf. Yllana, Grace: Multi-level governance: Testing it on the hard case of corruption, Paper presented
th
at the annual meeting of the International Studies Asociation, 48 Annual Convention/Hilton Chicago,
Chicago, www.allacademic.com/meta/p181111_index.html, 2007, viewed on 1.12.2008.

1
Increase in local corruption: A proof for systemic corruption?
Although the CMV has been installed its function is limited as it does not really
support actively the process of fighting corruption and just has a monitoring and
recommendation function. Although financial help and expertise has been granted to
Romania from the beginning of its accession the effective and strategic wise use of
these remedies stays disputable. A poll conducted by Transparency International in
the first half of 2008 suggests an increase in 'every day corruption' compared to the
previous year.56 This is alarming as Romania is approaching its third year of
membership within the EU in January 2009. The circumstances that local corruption
is still on the rise leads to the question if the CVM has missed taking important facts
into consideration which lead to local corruption. The second report of the European
Commission on the progress concerning all benchmarks of the CVM states that “The
existing structures– should allow Romania to produce effective results in the fight
against corruption.”7 This can be doubted if one takes into consideration the
prevalence of systemic corruption in former Soviet countries as Romania.8 As Stefes
argues corruption from a Western point of view “is usually considered to be the
expression or the outcome of something that went wrong in the countries’ transitions
towards democracy and a market economy.”9 He further argues that this casual
treatment of corruption by this definition does not take into consideration the crucial
role that corruption, crime and clientelism played in Soviet politics.10 Thus neither the
independent role of corruption is acknowledged within this Western point of view nor

5 cf. European Commission (ed.): Report from the Commission to the European Parliament and the
Council on Progress in Romania under the Co-operation and Verification Mechanism,
http://ec.europa.eu/dgs/secretariat_general/cvm/docs/romania_report_20080723_en.pdf, 23. 07.
2008, p.6, viewed on 2.12.2008.
6
cf. Transparency International (ed.): Global corruption report 2008 -Country report Romania,
http://www.transparency.org.ro/politici_si_studii/studii/global_coruptie/2008/Articol%20GCR%202008_
eng.pdf, 2008, viewed on 30.11.2008
7
European Commission (ed.): Report from the Commission, p.7.
8
cf. Stefes, Christoph H.: Systemic Corruption in Armenia and Georgia: Differences, Consequences,
and How to Fight It, Irex 2004 Caucasus Regional Policy Symposium Agenda, University of Colorado
at Denver, http://www.irex.org/programs/symp/04/Stefes.pdf, 2004, p.1, viewed on 1.12.2008.
9
ibid., p.1
10
ibid., p.1.

2
the existence of a widespread and institutionalized separate corruption system in
Romania. The findings of Stefes state that the separate corruption system was
characterized by its extent, reaching almost every segment of the communist state,
party and society. Its rules and norms were internalized and respected by many, if
not most officials and citizens.11 Applying this to Romania the rise in day to day
corruption in 2008 can be explained. Citizens, businesses and local government are
used to corruption as it was long time - even after the falling of the iron curtain - a
essential part of their system. The roots of this problem are not tackled sufficiently as
Romania is more concentrating on individual cases of high-level corruption of
politicians than approaching the corrupt system as a whole.12 Due to the latest report
from the European Commission Romania continues to make progress in the fight
against corruption at local level but needs to produce more results. It states that
public awareness campaigns, training sessions and other preventive measures have
been carried out. Also the number of corruption investigations within the police has
increased. However, in areas such as health and education where there are clear
indications of corruption, few measures have been taken.13 This is a problem and
asserts that people in Romania are faced daily with the problem of corruption. A
national corruption strategy to combat corruption in local public administration was
only adopted in June 2008, which shows that the problem of systemic corruption was
tackled nearly one and a half years after Romania’s accession to the EU. Having a
closer look at the structure of the regions and the local government can help to
determine gaps within the system in which corruption is still spreading in.

Which perspective of regionalization to fight local corruption?

To harmonize with EU structures, Romania has shifted toward regionalization and
regional development policies ten years in advance. Together with the Romanian
Government the European Commission proposed a Green Paper for Regional Policy

11
ibid., p.2
12
Pop, Valentina: Bulgaria and Romania perceived as most corrupt EU states, on: euobserver.com,
http://euobserver.com/9/26795, 23.09.2008, viewed on 30.11.2008.
13
European Commission (ed.): Report from the Commission, p.6.

3
in Romania in 1997, in 1998 the law on regional development came into effect.14 It
designs eight regions as basic regional policy units. They are perceived as a
development tool and not as an administrative structure as the main task of the
regional development policy is to eliminate unbalances in development of different
regions. Another responsibility is to manage European funds allocated by the EU.15
As it can be seen this regionalization was rather an artificial than a natural process
serving the purpose of approaching EU structures. They were means to an end being
a grid to allocate the structure funds of the EU. It is not known if Romania was ready
for this great shift of regionalization taking the communist past into consideration and
the fairly new democratic system. It is highly critical to view these eight regions as
bases for the allocation of funds as they were integrated in the existing system which
still carries attributes of corruption as stated above. Money flows therefore are hard
to control although the eight development regions are member of the Committee of
the Regions of the European Union since 2007 aiming at an increasing participation
of European regions in community life. As the development regions are not legal
entities they do not have an administrative status and a legislative or executive
council or government. Thus they are not integrated in the public administration
process meaning that they do not have responsibilities in local administration.
Without these responsibilities their position within the political entity of Romania is not
that transparent, they are not fully included in the governance system. Corruption can
take place. The local authorities, being the 42 counties, have several competences
related to the administration of local public interests and their financial resources are
established by law.16 Why do the eight development regions do not? They should be
equipped with adequate competences meaning that the competences of the 42

14
European Commission (ed.): FP Romania; Fiche no.12 - Regional Policy & Cohesion,
ec.europa.eu/enlargement/fiche_projet/document/ro9807-01-regional_policy.pdf, 1.07.1998, viewed
on 1.12.2008
15
cf. Ghinea, Anca: Multi-Level Governance in Romania, Institute for Public Policy Romania,
http://www.cecl.gr/RIGASNETWORK/databank/REPORTS/r19/Ro_19_Ghinea.html, 2004, viewed on
30.11.2008, p.6.
16
cf. Cuglesan, Natalia: Multi-level governance in the EU: What model for Romania?, in:
Eurojournal.org-Journal of Foreign Policy of Moldova, Issue 10/2006 on Central and Eastern
European Online Library (www.ceeol.com),
www.ceeol.com/aspx/getdocument.aspx?logid=5&id=8BF80D82-535A-4EFF-BDBF-ADFF20F9A579,
viewed on 30.11.2008, p.9.

4
counties being administrative units could be combined and shared with the local
development regions. This could be a perspective for Romania’s regionalization and
a strengthening for the multi-level governance system in the country as multi-level
governance implies the dispersion of authoritative decision-making across multiple
territorial levels.17 The increase of the efficiency level of local governance is therefore
dependent on the capacity of the local authorities to elaborate and implement public
policies at local level and to involve all interested factors, also the private sector.18
The inclusion of the eight development regions as legal entities could also help to
allocate the financial resources in a more controlled way. This would be an approach
to change the governance system and therefore would help to fight systemic
corruption. As more parties would be involved in local governance the expertise will
rise and financial resources of the eight development regions are assured for the
economical, social, cultural and scientific development projects. Summed up it can
be assumed that more efficient governance, meaning less corruption, can be
reached by granting competences to sub-national authorities strengthening the multi-
level governance system. It also has to be considered that public opinion in Romania
is still not ready to accept und understand this major change.19 This also supports the
opinion of Stefes that corruption is anchored and has for a long time been accepted
by society. Corruption has to be also viewed as a society problem. The acceptance
of corruption within society and the role of it in day-to day life should not be
underestimated. In the IRIS handbook20 this is proofed by a survey on business
registration & licensing within Romania. A significant number of respondents in this
survey were unwilling to classify some acts as corruption that analysts would
normally term as corrupt, for example, taking informal payments from a company for
buying its products - another proof for viewing corruption as a systemic phenomenon
which is prevalent not only in the public but also in the private sector.

17
cf. Hooghe, Liesbeth and Marks, Gary: Multi-Level Governance and European Integration, 2001,
p.3.
18
cf. Cuglesan, Multi-level governance in the EU, p.11.
19
cf. Ghinea, Multi-level governance in Romania, p.10.
20
cf. Iris Center at the University of Maryland (ed.), IRIS Handbook: Tools for Assessing corruption &
Integrity in Institutions, August, 2005, p.53.

5
Conclusion

The regional decentralization before accession was performed through the existing
local authorities which have been used to systemic corruption. Together with the fact
that the establishment of the development regions was based on the extending of
competences of the local authorities corruption could find a smooth path into the
eight development regions. For the time being Romania lags behind an effective
system of multi-level governance including only two levels: Central and local. As
relevant actors at the same level being the development regions and the local
authorities can not interact with each other due to the difference of their authorities,
the decision-making processes can up to day not be freed efficiently from corruption.
This can be proofed by the increase in day to day corruption in 2008. At the state of
the art the governance system of Romania tends to facilitate corruption. The question
which will be interesting to catch up within the near future is if the very late, more
precisely in June 2008, adopted national corruption strategy to combat corruption in
local public administration will be able to break through the hard walls of systemic
corruption.

List of References

Cuglesan, Natalia: Multi-level governance in the EU: What model for Romania?, in:
Eurojournal.org-Journal of Foreign Policy of Moldova, Issue 10/2006 on Central and Eastern
European Online Library (www.ceeol.com),
www.ceeol.com/aspx/getdocument.aspx?logid=5&id=8BF80D82-535A-4EFF-BDBF-
ADFF20F9A579, viewed on 30.11.2008, p.9

European Commission (ed.):

Assessing ongoing process by Bulgaria and Romania,
http://ec.europa.eu/dgs/secretariat_general/cvm/index_en.htm, 13.10.2008,
viewed on 30.11.2008

European Commission (ed.): FP Romania; Fiche no.12 - Regional Policy & Cohesion,
ec.europa.eu/enlargement/fiche_projet/document/ro9807-01-regional_policy.pdf, 1.07.1998,
viewed on 1.12.2008

6
European Commission (ed.): Report from the Commission to the European Parliament and
the Council on Progress in Romania under the Co-operation and Verification Mechanism,
http://ec.europa.eu/dgs/secretariat_general/cvm/docs/romania_report_20080723_en.pdf, 23.
07. 2008, p.6, viewed on 2.12.2008

European Commission (ed.):

Report on Progress in Romania under the Co-operation and Verification Mechanism,
http://www.eubusiness.com/Romania/romania-progress.08/, 23.07.2008,
viewed on 30.11.2008

Ghinea, Anca: Multi-Level Governance in Romania, Institute for Public Policy Romania,
http://www.cecl.gr/RIGASNETWORK/databank/REPORTS/r19/Ro_19_Ghinea.html, 2004,
viewed on 30.11.2008, p.6

Hooghe, Liesbeth and Marks, Gary: Multi-Level Governance and European Integration,
2001, p.3.

Iris Center at the University of Maryland (ed.), IRIS Handbook: Tools for Assessing
corruption & Integrity in Institutions, August, 2005, p.53.

Pop, Valentina: Bulgaria and Romania perceived as most corrupt EU states, on:
euobserver.com, http://euobserver.com/9/26795, 23.09.2008, viewed on 30.11.2008

Stefes, Christoph H.: Systemic Corruption in Armenia and Georgia: Differences,

Consequences, and How to Fight It, Irex 2004 Caucasus Regional Policy Symposium
Agenda, University of Colorado at Denver, http://www.irex.org/programs/symp/04/Stefes.pdf,
2004, p.1, viewed on 1.12.2008.

Transparency International (ed.): Global corruption report 2008 -Country report Romania,
http://www.transparency.org.ro/politici_si_studii/studii/global_coruptie/2008/Articol%20GCR%
202008_eng.pdf, 2008, viewed on 30.11.2008

Yllana, Grace: Multi-level governance: Testing it on the hard case of corruption, Paper
presented at the annual meeting of the International Studies Asociation,
48th Annual Convention/Hilton Chicago, Chicago,
www.allacademic.com/meta/p181111_index.html, 2007, viewed on 1.12.2008