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RACC News Alert - November 23, 2005 | | U.S.A. Ambassador to arrive next month; investors still avoid Romania | | ![]() U.S. Charge d'Affaires Mark Taplin severely criticized the government yesterday for not focusing enough on the binding nature of contracts, but also announced the arrival of the new U.S. Ambassador to Romania during December, as the best proof that bilateral relations remain positive.
"Romania and the U.S. have a
remarkable partnership. But for it to be sustainable in the long-term, we need to do more to give impetus to our economic and trade ties," said U.S. Charge d'Affaires Mark Taplin yesterday, at a meeting with the Romanian Association for International Law and International Relations.
Taplin pointed out that even if economic relations between the two countries have registered remarkable progress in recent years, the relationship has not yet reached its full potential because many potential American investors still avoid Romania. "Investors are packing their bags, or staying away in the first place, drawn by opportunities in neighboring countries that on paper should not necessarily have a strong edge over Romania," said Taplin.
According to Taplin, due to the global competition for investment, Romania needs to do more if it wants to take advantage of this period when its upcoming accession to the EU, competitive labor rates and highly skilled workforce should be a very
compelling attraction for any potential investor. "The numbers help tell the story. For instance, Bulgaria's per capita FDI Foreign Direct Investment is more than twice Romania's, and Hungary's is nearly eight times as large," explained Taplin.
Taplin outlined the factors which discourage U.S. investment and said that Romania needs to promote better governance, across the board. "More needs to be done to diminish the opportunity for calculations of private interest or political advantage to override the imperative of serving the public interest," he said.
Another negative factor pointed out by the U.S. Charge d'Affaires is that the government does not focus enough on the binding nature of contracts and legal obligations. "Too often it seems that if one official signed an agreement, his or her replacement feels they are no longer responsible for seeing that its terms are respected and carried out," he said.
Another challenge, according to Taplin, is balance and
transparency in the legislative process, as laws rushed forward both by legislators and by government ministers, with virtually no provision for public debate or balanced review discourage foreign investors. "Investors are attracted to stable and predictable environments, where proper consultation with stakeholders and the public takes place. But average Romanians suffer too, when some groups of insiders promote a legislative 'solution' for the few that runs counter to the goal of promoting economic growth and opportunity for the many," said Taplin.
"EU used as excuse for lack of transparency or fairness to foreign investors"
Taplin added that Romania is not responsible and mature enough when it comes to implementing EU legislation. "When our Embassy has raised questions about transparency, about fairness to foreign investors, we very typically hear that 'Brussels made us do it'. I am sure that is indeed the case, sometimes. But just as often, it is a handy,
all-purpose talking point to avoid having to answer for non-transparent rule-making or impatient governance," Taplin said.
Taplin added that the U.S. and the EU have essentially the same interest in fostering Romania's full entry into Europe.
Nicholas Taubman to move to Romania next month
Taplin said Romania's relations with the United States are still good in spite of obstacles in the business environment. He mentioned the arrival of the newly appointed U.S.A. ambassador as the best proof of the positive relations between the two countries.
Nicholas Taubman is to present his accreditation letters to President Traian Basescu in December, according to the Charge d' Affaires.
Taplin said that Taubman's appointment is "a tribute to the continuous growing-up of American-Romanian relations" revealing promising horizons in the months and years to come and described the ambassador as "a
leader full of energy," who has significant experience in the business field and is an influential political personality willing to contribute to the improvement of the partnership between the two countries.
Taubman, a 75 year old billionaire and supporter of the Republican Party, is currently president of Mozart Investments in Roanoke, Virginia, and previously was chairman at Advanced Auto Parts.
He graduated from the University of Pennsylvania, and is among the richest 100 people in the state of Virginia, with a fortune of over $ 1 billion. His wife, Jenny, has worked as an Army employee in Israel, and together they are involved in several projects to support the local community.
The position of U.S. Ambassador to Romania has been vacant since May this year.
Recent investments sweeten Taplin's pill for the government
Taplin continued his
speech by pointing out some recent achievements, considered to be positive signs towards a better economic relationship. "The recent announcement by Emerson Electric Company to invest up to 125 million euros to build a factory in Cluj as well as to partner with that city's Technical University for research and development is a notable example," he said.
Taplin also referred to the Black Sea region, emphasizing Romania's important role in solving conflicts in the area. "Romania has demonstrated leadership in seeking to build more economic, political, and security links among the Black Sea nations. We agree with our allies and friends that while the threat of greater instability in the region remains, for the moment, just a threat, the potential risks are considerable," Taplin said.
According to the U.S. Charge d'Affaires, under the leadership of President Traian Basescu and Foreign Minister Mihai Razvan Ungureanu, Romania is taking the right steps
to reach out to its friends and neighbors to build a stronger regional dialogue. "But the burden should not fall only on the six countries bordering on the Black Sea. It should involve other organizations and states in the region through negotiation and agreement. The U.S. will continue to encourage and support the new democracies around the Black Sea, and will do so in tandem with close allies like Romania," added Taplin.
Denisa Maruntoiu
Daily News
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