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241571 12/24/2009 6:17 09BUCHAREST863 Embassy Bucharest UNCLASSIFIED//FOR OFFICIAL USE ONLY 08BUCHAREST1008|09BUCHAREST669|09BUCHAREST691|09BUCHAREST756|09BUCHAREST857 VZCZCXRO4863 PP RUEHIK DE RUEHBM #0863/01 3580617 ZNR UUUUU ZZH P 240617Z DEC 09 FM AMEMBASSY BUCHAREST TO RUEHC/SECSTATE WASHDC PRIORITY 0202 INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE PRIORITY UNCLAS SECTION 01 OF 03 BUCHAREST 000863

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E.O. 12958: N/A TAGS: PGOV, PREL, RO SUBJECT: ROMANIAN PARLIAMENT APPROVES NEW CABINET, ENDING PROTRACTED POLITICAL CRISIS

REF: A. 08 BUCHAREST 1008 B. BUCHAREST 669 C. BUCHAREST 691 D. BUCHAREST 756 E. BUCHAREST 857

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1. (SBU) SUMMARY. On December 23 the Romanian Parliament approved the new Cabinet assembled by Prime Minister designate Emil Boc with an unexpectedly large majority. The new Cabinet includes members of the Democratic Liberal Party (PDL), the Democratic Alliance of Hungarians in Romania (UDMR) and non-affiliated politicians. This vote effectively ends a three month-long political crisis triggered by the collapse of the former governing coalition (PDL and Social Democrats, or PSD) in late September (reftel B). The governing program presented by the new Cabinet continues the austerity programs supported by the previous Boc Cabinet, maintains current taxation levels, and suggests new public sector lay-offs in the coming months in order to comply with the IMF requirements. END SUMMARY.

A NEW COALITION GOVERNMENT, A NEW PARLIAMENTARY MAJORITY

2. (SBU) On December 23, the joint chambers of the Romanian Parliament voted 276 to 135 to approve a new Boc Cabinet. As PDL and UDMR together control only 42 percent of the parliamentary seats (198 out of 470), the extra support came from ethnic minority representatives (18 votes) and from a newly-constituted group of "independents" (24 votes). The vote count indicates that approximately three dozen PSD and National Liberal Party (PNL) legislators also voted for the government, likely out of fear that a protracted battle could lead to early parliamentary elections.

3. (SBU) President Basescu's re-election has triggered a reconfiguration of the political spectrum. The UDMR, which had aligned itself with PSD and PNL before the presidential vote but was desperate to re-enter government, switched camps on December 19 and join the President's PDL as the junior governing partner. After brief negotiations, UDMR was given control over three Cabinet portfolios: culture, health, and environment and forests. The UDMR chair, Marko Bela, will serve as the deputy PM. The caucus of "independent" legislators also joined PDL in exchange for an important ministerial portfolio--defense--for their leader, Gabriel Oprea.

THE NEW CABINET: A POLITICAL PATCHWORK

4. (SBU) The new PDL-UDMR Cabinet includes the prime minister, a deputy prime minister and 15 ministers (down from 19 in September). The new Cabinet reflects not only the new parliamentary majority but also President Basescu's pledge to include the opposition and non-affiliated experts. Basescu, in a move meant to illustrate his new conciliatory line, openly invited former PSD Labor Minister, Mirian Sarbu, to join the new Boc government but was turned down by PSD. PM designate Boc tendered a similar offer to a former member of a PNL-led cabinet, and now independent, Sebastian Vladescu, who accepted the post of Finance Minister without his party's endorsement. The new Boc Cabinet welcomes two new politicians with no party affiliation, alongside independent Justice Minister Catalin Predoiu who served in the previous Boc government. The full list of ministers is included below:

- Prime Minister: Emil Boc (PDL) - Deputy Prime Minister: Marko Bela (UDMR) - Minister of Administration and Interior: Vasile Blaga (PDL) - Minister of Public Finance: Sebastian Vladescu (independent) - Minister of Economy, Trade and Business - Environment: Adriean Videanu (PDL) - Minister of Foreign Affairs: Theodor Baconschi (independent) - Minister of Transportation and Infrastructure: Radu Berceanu (PDL) - Minister of Environment and Forests: Laszlo Borbely (UDMR) - Minister of Regional Development and Tourism: Elena Udrea (PDL) - Minister of National Defense: Gabriel Oprea (independent) - Minister of Culture and Patrimony: Kelemen Hunor (UDMR) - Minister of Justice: Catalin Predoiu (independent) - Minister of Communications and Informational Society: Gabriel Sandu (PDL) - Minister of Labor, Family and Social Protection: Mihai Seitan (PDL)

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- Minister of Education, Research, Youth and Sports: Daniel Funeriu (PDL) - Minister of Health: Cseke Attila (UDMR) - Minister of Agriculture and Rural Development: Mihail Dumitru (independent)

5. (SBU) PDL is the senior governing partner, with the prime minister and seven other ministers. These are the old guard: six of the eight served in the first PDL-controlled cabinet. Prime Minister Boc, Transportation Minister Berceanu, and Communications Minister Sandu will occupy positions held since December 2008. Two other PDL ministers, Adriean Videanu and Elena Udrea, will now oversee enlarged portfolios: Videanu's Economy was combined with Trade and the Business Environment while Udrea's Tourism was combined with Regional Development. The former Minister of Regional Development, Vasile Blaga, will head Administration and Interior, a portfolio he oversaw between 2005 and 2007 and held temporarily after the PSD left the cabinet in early October. Catalin Predoiu, the independent, formerly PNL, Justice Minister will continue the mandate he assumed in 2008 (see ref A for biographies on these ministers).

6. (U) Mihai Seitan, 63, the new Minister of Labor, is a long-standing member of the PDL (and its PD predecessor) but has never held high party positions and is considered more of a technocrat than a politician. He served for several months as state secretary in the Labor Ministry before his ministerial nomination, and also formerly worked for the World Bank. Between 2005 and 2007, he was the head of the National Authority for Pensions and Social Security and was one of the architects of Romania's partially privatized pension system, expertise which will be valuable as the Government takes up additional pension reforms under the IMF program. In early 2009 Seitan became one of Boc's closest advisors. Daniel Funeriu, 38, comes to the Ministry of Education, Youth and Sport after serving in the European Parliament in November 2007 and as a vice-chair of the special presidential committee for education and research. Neither Seitan nor Funeriu hold leadership positions in PDL.

7. (SBU) The ethnic-Hungarian UDMR brings Marko Bela and Laszlo Borbely, two long-standing legislators and former senior cabinet members. Bela, 58, is UDMR chair and served as Deputy Prime Minister in the PNL-led cabinets of PM Calin Popescu-Tariceanu between 2005 and 2007. Borbely, 54, a UDMR executive vice-chair, was a Development Minister in the same PNL-led cabinets between 2005 and 2008. Minister of Culture Kelemen Hunor, 42, the UDMR's first-round presidential candidate, held a state secretary position in the same ministry from 1997 to 2002. Hunor is seen by some as Marko Bela's heir apparent.

8. (SBU) Cseke Attila, 32, the surprising UDMR nomination for the health portfolio, was a junior official in the General Secretariat (the administrative body of the Cabinet) between 2005 and 2008. In 2008, he was elected to the Senate, where he served on the legal committee. As the youngest and least-experienced new cabinet member, Attila is an odd choice for the Ministry of Health, with no medical background and scant administrative experience. The Ministry, and Romania's health system generally, are beset by serious problems and are in desperate need of reform, but this young UDMR official from Oradea seems poorly positioned to take on the many entrenched interests in the health sector.

9. (U) The Ministers of Foreign Affairs (MFA), Defense, Justice, Finance, and Agriculture have no party affiliation. Foreign Minister Teodor Baconschi, a career diplomat, has served as the Romanian Ambassador to the Vatican, Lisbon, and, since September 2008, to Paris. In January 2005 he was appointed as MFA's state secretary for global affairs, a position he held until September 2006, when he was dismissed following a reduction of the number of state secretaries. In October 2007, President Basescu brought Baconschi into the presidential staff as advisor for domestic policies and civil society, before sending him to Paris as Ambassador one year later. Baconschi is widely credited with convincing Pope John Paul II to visit Romania in 1999, the late Pope's first visit to an Orthodox Christian country. Under Baconschi's ambassadorship, Romania also signed a strategic partnership with France. Baconschi, 46, has a degree in theology and a Ph.D. in religious anthropology and comparative history of religions from Sorbonne, Paris.

10. (U) Defense Minister Gabriel Oprea, 48, is a retired Army general who oversaw administrative, economic and national security issues. He was the PSD's nominee for Interior Minister in December 2008, when the ill-fated

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PDL-PSD coalition was formed. Oprea's ministerial mandate was short-lived; the PSD viewed him as more loyal to Basescu than to his own party. PSD stripped him of political support and Oprea resigned from the party in January 2009. Soon after, Basescu promoted Oprea to the rank of a four-star General, his second promotion after retiring from the military in 2000. In November, he and like-minded legislators formed a now-sizable caucus of "independents" who proved critical in shaping the new parliamentary majority.

11. (U) Finance Minister Sebastian Vladescu, 51, previously of the PNL but now an independent, served as Finance Minister in the PNL-led cabinet of 2005-2007 and subsequently as a state secretary in the same ministry. His first nomination was based on personal ties to then-PM Tariceanu and was not fully endorsed by the PNL. Moreover, during the battles between PNL and President Basescu's PDL, Vladescu often sided with Basescu, most notably on the issue of keeping Romanian troops in Iraq. Vladescu is generally viewed favorably by the foreign investor community, having served as the Tariceanu Government's chief negotiator with Ford for privatization of the Craiova auto plant and later as chairman of the selection committee which awarded management of Romania's Property Fund to Franklin Templeton. Agriculture Minister Mihail Dumitru is probably the least well-known of the new ministers because, unlike most of his other colleagues, he has never held a public office. For more than a decade (1995-2006), Dumitru was the chief of the agricultural department at the European Commission Delegation in Bucharest. After Romania joined the EU in January 2007, Dumitru moved to Brussels as negotiator-coordinator of the Program for Romania's rural development. Dumitru is said to have a close relationship with former minister Dacian Ciolos, who was recently named European Agriculture Commissioner by EC President Barroso ) perhaps auguring well for coordination between Brussels and Bucharest on assistance, especially through better absorption of EU funds, for Romania's backward agricultural sector.

11. (SBU) COMMENT. The Parliamentary approval of this new Boc Cabinet ends a three-month political crisis that began when the previous PDL-PSD coalition collapsed in late September (ref B). The demise of the former coalition and the inability to find parliamentary support for a new cabinet slowed necessary reforms, limited the government's ability to respond to the economic crisis, and delayed the disbursement of crucial IMF loan installments. The two-to-one margin of approval indicates that some PNL and PSD members voted to confirm the cabinet despite their parties' public stance in opposition. In contrast to the October 13 no-confidence vote which brought down the prior Boc Cabinet, this time around neither PSD nor PNL leaders threatened their members with expulsion as punishment for breaking party discipline. That fact reflects a new reality: as Romania thaws after an exhausting election season and two brutal snowstorms, Traian Basescu has emerged as the indisputable winner and driving force of Romanian politics. END COMMENT. GITENSTEIN