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Priorities for Romania's infrastructure - Doing Business | DOINGBUSINESS.RO

  |  09.11.2012

Priorities for Romania's infrastructure

Romania needs to focus and increase its efforts to rehabilitate and construct major transportation routes and railroads, especially the European Corridors segments leading to improved national and international traffic and safety and economic growth

Of equal importance is to improve the environmental infrastructure and related facilities in order to achieve compliance  with national legislation and the EU Acquis Communitaire, translated into the provisions laid down in the EC Environmental Directives for water, wastewater and waste sectors.


Two of the most important priorities should be the proper planning and spending of the investment values and the close monitoring of the works progress enabling the authorities to anticipate and mitigate any project delays and occurrence of additional allocation of funds.


European programs


The seven years of programming has a two years delay for reimbursing, meaning that the commission is allocating an amount over seven years  - 2007-2013 - and we need to spend it between 2009-2015, and so we will have two more years for absorbing the EU funds. For Romania and Bulgaria, we had the n+3 years rule, meaning that what the commission is allocating between 2007-2010 we could spend between 2010-2013, and from 2011 to 2013 for two more years (n+2 rule). The commitment, (the financial allocation) for the year N has to be spent and certified by the Member States until the year N+3 (N+2) inclusive. The amounts not spent within this time frame will be lost for our country. All these sectors are part of the main priorities within the respective Operational Programmes Axes and they are developed in parallel, although we could notice a better management and use of the allocated funds for the environmental related infrastructure. The tendering and contracting process was one of the reasons which positively influenced this.


Finding a private partner


Although the notion of PPP has been conveyed for years now in Romania, its application still remains a rather unconventional tool for many public authorities and it may be precisely for this reason that many of them disregard it as being an effective procurement method. So, first of all it is a matter of institutional and political drive to plan and prepare projects suitable under a PPP-type arrangement.

In what the national regulations are concerned, the national procurement legislation is generally considered viable for contracting private sector investors as long as its application is done diligently (for example, the value for money principle is not necessarily compatible with the lowest price criterion that has been so much used lately in public procurement). Given the trend in recent years, the concentration has been on smaller scale projects (of tens of millions of Euros) rather than on mega-projects requiring investments in the order of hundreds of millions. Therefore, local public authorities may well become a more active party in the setting up of PPPs as urban projects may capture the interest of private contractors and of funding agencies, both in terms of size and related risks.

The majority of funds comes from EU and major IFIs and the absorption of this financing is done through public tendering. This process is a major impediment which is also delaying the contracting period and thus not respecting the investment planning at national level. There were several attempts to impose revisions of the public procurement law aiming for improving this process’ efficiency, but it still has sufficient unclear articles which are subject to the contracting authorities ‘decision and which are often contested and the process further delayed.

The procurement process needs to be more transparent and coherent with standard tendering documents and both ANRMAP and CNCS will have to adopt a coherent approach in presenting their points of view to standardize the process.


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