Sun, Apr 29, 2012 - Page 6 News List

Austerity topples Romanian Cabinet

Reuters, BUCHAREST and PRAGUE

Romania’s left-leaning opposition will try to form a new government after torpedoing the center-right Cabinet in a confidence vote on Friday, the latest collapse of an austerity-minded ruling coalition in Europe.

Like other governments in the EU, ousted Romanian Prime Minister Mihai Razvan Ungureanu’s two-month-old Cabinet has faced a wave of public anger against plans for spending cuts and tax hikes. Violent protests toppled his predecessor, former Romanian prime minister Emil Boc.

“Today justice was done,” said Victor Ponta, head of the left-leaning opposition Social Liberal Union (USL).

Romanian President Traian Basescu, a political opponent, nominated Ponta to try to form a new government as prime minister.

The defeat came hours before a confidence vote for another budget-cutting EU government, in the Czech Republic. Although Czech Prime Minister Petr Necas survived, his unpopular Cabinet might now be hamstrung by a thin majority, infighting among its scandal-plagued parties and public outrage over its policies.

French President Nicolas Sarkozy is on course in nine days to become France’s first president to be voted out of office in 30 years, and a center-right Cabinet in the Netherlands resigned this week over disagreement about budget tightening measures.

“The end result seems to ... echo what we have been seeing in other countries in terms of a popular move away from the parties that are pushing for austerity,” said Koon Chow, a strategist at Barclay’s Capital, of the Romanian vote. “France, Holland, the Czechs — it’s all connected.”

Ungureanu was defeated by the votes of 235 deputies, four more than required to topple his government.

The EU’s second-poorest member slashed public sector salaries and raised sales taxes to put its economy on a more solid footing, but the measures have hit the poorest as Romania emerges only slowly from a two-year recession.

Ponta said he controls 228 seats in the 460 member parliament. He should be able to gain backing from smaller parties that will give him a clear majority. If parliament fails to back a new prime minister, an early vote would be held. The next general election is scheduled for November.

The rise of Ponta, 39, marks a change of guard for his Social Democrat party, founded chiefly by former communists and now the dominant force in the USL. Some analysts and opponents say he remains under the influence of its founder, Moscow-educated Ion Iliescu.

“USL has already prepared a government and could appear in front of parliament towards the end of next week,” political commentator Mircea Marian said.

The IMF, which with the EU has extended two loan packages to Romania, postponed a review there pending details on the shape of a new government. The deal is key to Bucharest’s battle to maintain investor confidence.

The IMF said it expected Romania to observe its economic policy commitments.

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