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Romania's Portuguese hope

by Andrei Postelnicu
September 2004

Jacques Chirac, with the subjectivity that comes with being a head of state, thought France's economy somehow warranted that France's European commissioner be granted a high-powered economic post in the new EU executive.

Jose Manuel Barroso, the European Commission's new president, managed to be more objective and realised that France's trains run better than pretty much anything else in the otherwise spectacularly inefficient French economy. And thus Jacques Barrot, the French commissioner, is now responsible for transport in the EU executive.

The moral of this is that Mr Barroso may well become the most influential Portuguese in recent memory, if his deft handling of forming the new European Commission is any indication of how he might perform in his new job. Having had no choice in deciding the roster of his term, Mr Barroso did not bow in front of the often unreasonable demands coming from the big member countries and allocated the briefs in a surprisingly wise manner: a Dutch businesswoman is in charge of competition, Ireland's representative, hailing from a country that knows a few things about the EU's benefits, is in charge with the internal market. Britain's Peter Mandelson is the top trade man, which is not quite as good as Pascal Lamy continuing but not that much worse.

The way Mr Barroso allocated the posts in the commission shows independence of thinking; but equally important is his rhetoric as he did so, and the way in which he set the agenda for the next five years of the EU executive's next term.

The reason for this has to do with the fact that, absent a giant cock-up from Romania, its entry into the EU in 2007 is all but assured, at least for one diplomatic source whose credibility I have no reason to doubt. Consequently, Mr Barroso's economic agenda is vital for Romania for it will determine the kind of policy environment it will join once it does become an EU member. If the job of Olli Rehn, the Finn charged with enlargement, is pretty much determined by more talk of Turkey than of Romania/Bulgaria, what will matter more is what happens to the Balkan countries once they join the club.

And from what Mr Barroso has said, he stands to be more crucial for Romania than any other Eurocrat or even head of state in any of Europe's powerful capitals.

If his speech is anything to go by, reviving the EU's sclerotic economy will be the main priority for Mr Barroso and his team. Fresh from having appointed his team in as independent a manner as he could, the former Portuguese premier identified the EU's sorriest source of embarrassment and professed to fix it. In an even more admirable show of commitment, Mr Barroso took charge of the effort to move forward the Lisbon Agenda, the EU's ambitious but until now hopeless effort to revive its economy and make it the world's most competitive by 2010.

The cynic in me wants to point out that, Mr Barroso's rhetorical bravado notwithstanding, his efforts will end up in smoke without the backing of the EU's member states. Under Romano Prodi, the EU executive has found itself pushing on a string on more than one occasion. Unpalatable reforms, though necessary, were never carried out. Union-wide directives found their death in the EU Parliament at the urge of lobbies from local unions and the like. All in all, there is plenty of scope in the EU bureaucracy for Mr Barroso's ambitious rhetoric to remain just that - rhetoric.

But never mind my rampant euroscepticism. Let's just pretend it's Christmas and not be a Scrooge. If that's the case, there's much more to cheer about for Romania than meets the eye.

If Mr Barroso succeeds even partially in furthering his agenda of economic reform, Romania has a shot at integrating into an economic environment that's worth integrating into. Yes, the EU economies won't be transformed in the next five years, but if the reality follows the rhetoric, the impetus for reform will have to have some results. The difference will be between today's soporific pace of economic change in France, Germany and Italy and what could be a more dynamic situation down the road. Rather than the current model of utter mediocrity and complacency in economic policy, Romania might actually have an example worth following. Now if only there will be some bright sparks in Bucharest to do just that.

Andrei Postelnicu writes about global markets for the Financial Times in New York, and writes for Vivid in a personal capacity.