Europe 2020 in Romania

The Country-specific Recommendations are documents prepared by the European Commission for each country, analysing its economic situation and providing recommendations on measures it should adopt over the coming 18 months. They are tailored to the particular issues the Member State is facing and cover a broad range of topics: the state of public finances, reforms of pension systems, measures to create jobs and to fight unemployment, education and innovation challenges, etc. The final adoption of Country-specific Recommendations prepared by the Commission is done at the highest level by national leaders in the European Council.

Country overview

The Romanian economy expanded by 0.7 % in 2012 and the Commission forecasts a modest recovery for 2013, with growth picking up to around 1.6 %, driven primarily by domestic demand and investment.

The labour market recovered somewhat in 2012 but challenges remain, in particular regarding high youth unemployment. Unemployment fell from 7.4 % in 2011 to 7 % in 2012 but youth unemployment, currently at around 23%, is expected to remain high.

Romania is currently completing the implementation of the second economic adjustment programme with the EU and the IMF. The programme should be formally completed after a final review in the summer 2013.

Romania also faces a number of further, medium-term challenges in the bid to secure smart, sustainable and inclusive growth. At 46 % of the EU average, Romania’s GDP per capita is one of the most telling indicators of the country’s developmental gap. Particular challenges include the need to increase labour market participation, improve overall competitiveness and reform the public administration. EU funds can provide an important source of public investment to support Romania in addressing these challenges.

2013 European Commission's recommendations for Romania in brief

The Commission has issued eight country specific recommendations (CSRs) to Romania to help it improve its economic performance. These are in the areas of:

  1. Implementation of the precautionary programme
    Romania negotiated with the European Commission and the IMF a precautionary economic adjustment programme in 2011.In March 2013 Romania formally requested a three-month extension and therefore the final programme review will take place by the end of June 2013.
  2. Sustainable public finances and taxation system
    Although the fiscal position has been improving in Romania low tax compliance represents a major challenge and the sustainability and adequacy of the pension system is at medium risk in the long-term. Therefore, Romania should improve tax collection, equalise the pensionable age for men and women and underpin the pension reform by promoting the employability of older workers.
  3. Health sector reform
    There are major inequalities in the Romanian health sector mainly due to the inefficient use of resources and poor management. Romania should put more efforts into increase the cost-effectiveness of the system by reducing the excessive use of hospital in-patient care and by strengthening primary care and referral systems
  4. Labour market, youth unemployment and poverty
    Romania had a low employment rate in 2012 and the youth employment rate was among the lowest in the EU. Romania should enhance the quality of active labour market policies and implement without delay the National Plan for Youth Employment. The level of the population at risk of poverty and social exclusion is also very high and children are particularly affected. Romania should adopt the remaining legislation without delay and ensure the link with activation measures.
  5. Education reform
    Romania faces a major challenge in raising the quality of its education and training system. Early school leaving is a significant challenge. Romania should implement its reforms whilst building up its administrative capacity. Tertiary education should be aligned with the needs of the labour market and improve access for disadvantaged people.
  6. Better public administration
    Poor administrative capacity is a core concern for Romania which contributes to the low absorption of EU funds. The governance and quality of public administration should therefore be strengthened.
  7. Business environment
    Major challenges for Romania are a weak business environment and low support for research and development. The Romanian authorities should ensure a coherent e-government and undertake efforts to ease access to finance and to reduce the administrative burden on SMEs.      Romania should also improve the efficiency and independence of the judiciary system and the effectiveness of policies to prevent and combat corrupt practices, notably in the area of public procurement.
  8. Energy and transport
    Romania has a low degree of competition and efficiency in the energy and transport industries. It should ensure the liberalisation of gas and electricity prices strengthen the governance of state-owned enterprises and regulators and complete cross-border connections. The take-up of broadband in Romania is the lowest in the EU and should be more widely rolled out, while in transport a comprehensive long-term plan is needed.

See how Romania compares with other EU Member States in key areas

European Semester Documents