Growth Poles to Promote Competitiveness and Cohesion - Romania Nicolae Rotileanu, PM Chancellery

ROMANIAS DEVELOPMENT REGIONS (NUTS 2) Nord Est Sud Est Sud Sud Vest Vest Nord Vest Centru Bucureşti-Ilfov

ROMANIAN CONTEXT I Romanias GDP = 42% of the EU average 8 NUTS-2 regions, out of which 7 are among the 15 poorest regions of the EU, but discrepancies exist. Nr. crt.Region GDP in 2005 Million EUR GDP in 2005 EUR/inhab. 1NORD EST SUD EST SUD SUD VEST VEST NORD VEST CENTRU BUCUREŞTI-ILFOV ROMANIA Source: EUROSTAT

GDP per region

ROMANIAN CONTEXT II Similar discrepancies in the levels of urbanization… Nr. crt.Region Total Population 2006 Urban Population 2006 Percentage of Urban Population NORD EST ,6% 2SUD EST ,4% 3SUD ,6% 4SUD VEST ,6% 5VEST ,5% 6NORD VEST ,1% 7CENTRU ,8% 8BUCUREŞTI-ILFOV ,5% 9ROMÂNIA ,2% Source: Romanian Statistical Yearbook 2007

Unemployment and FDI % per region

ROMANIAN CONTEXT III … and in the levels of FDI and unemployment these internal imbalances have been increasing these internal imbalances have been increasing Nr. crt.Region Unemployment Rate 2006 FDI at the end of 2006 Million EUR FDI at the end of 2006 % 1NORD EST6.2% % 2SUD EST5.6% % 3SUD6.4% % 4SUD VEST7%7% % 5VEST4.1% % 6NORD VEST3.6% % 7CENTRU6.1% % 8BUCUREŞTI-ILFOV2.2% % 9ROMANIA5.2% % Source: Romanian Statistical Yearbook 2007

ROMANIAN CONTEXT IV all eight regional capitals are specialized in one or several economic sectors, with the potential of increasing if provided with a better business environment all regions are rather balanced demographically, with large rural populations spread around spatially dispersed regional centers …so each regional center has the potential to become a growth pole

STRATEGY CHOICE need for a fair and efficient strategy incremental approach - mid-term evaluation - fast growing, running behind economy - great socio-economic imbalances - shift towards strategies based on efficiency A growth pole policy can: - allow a fair chance for all regions - channel the funds into investments with greater economic return. - ensure impact and visibility

IMPLEMENTATION MECHANISMS Need for a wide political agreement in order to ensure sustainable success the implementation mechanisms of the policy has been discussed/negotiated for months among the government members and with the EC

IDENTIFICATION OF POLES the 7 (8-Bucharest) regional capitals have a clear potential of becoming growth poles, but other cities of Romania rightfully claimed their status as potential growth poles too considerable pressure a decision was taken to limit the number of growth poles to 7, in order to maintain the credibility of the policy and avoid any suspicion of supporting a clientele policy nomination by means of government decision; funds are set aside, but not granted beforehand

INSTITUTIONAL SETUP strategic national coordinator responding directly to the Prime Minister; Ministry of Development as responsible body for the policy implementation inter-ministerial working group, under the auspices of the National Coordination Committee to ensure policy coherence sustainability and appropriate funding seven commissioners/managers, at the level of the Ministry of Development, one for each growth pole to tackle variable or insufficient administrative capacity at local level

STRATEGY DESIGN Local authorities create integrated development plans - based on running engines - with spillover effects over the region Ministry of Development - analyzes viability of the plans - integrates them IM/PM level ensures coherence and coordination - with other OPs - and with the other major strategies of Romania

FUNDING Guaranteed by government decision and by decisions of the National Coordination Committee A mix of: 50% of Priority Axis Sustainable Urban Development from the Regional Operational Program contributions from all the relevant OP contributions from national programs possibly EIB loans

PROSPECTS Details on implementation still under discussion Strategy in the elaboration process