Romanian government collapses after no-confidence vote

Summary

• Social Democrats, hard-right parties oust Liberal premier
• Centrist president set to call parties for consultations
• Analysts expect protracted negotiations over a new majority
• Romanian leu hits new record low

Romanian lawmakers toppled Prime Minister Ilie Bolojan's pro-EU ​government in a no-confidence vote on Tuesday (5 May), putting at risk the country's sovereign debt ratings, its access to ‌EU funds and the stability of its currency.

Bolojan has led a minority government since late April when the Social Democrats - the largest party in parliament - called for his resignation and then walked out of the four-party coalition and teamed up with the far-right opposition to file a no-confidence vote.

Tuesday's no-confidence motion garnered 281 votes, ​above the 233 needed to pass, the official parliamentary count showed.

Although a snap election looks unlikely, financial markets are concerned that ​the turbulence could mean Bucharest wavers in its commitment to narrowing the European Union's biggest budget deficit. Romania's leu ⁠currency fell to a record low against the euro ahead of Tuesday's vote.

The current coalition came to power 10 months ago with a ​view to containing the gains of the far right after a series of polarising elections, and it had begun to reduce the deficit, narrowly ​avoiding a ratings downgrade from the last rung of investment grade.

But the Social Democrats -without whom a pro-EU majority cannot be achieved - have repeatedly clashed with Bolojan as his austerity measures have hit their voters and patronage networks, while their popular support has bled away to the far right.

Nevertheless, opinion polls show Bolojan is ​the most popular politician in the ruling coalition.

'Do you have a plan?'

"Can anyone say how Romania will function from tomorrow, do ​you have a plan?" Bolojan asked lawmakers before the vote.

"Romanians will understand that you can govern differently, with respect for public money, and you cannot undo that."

Romania's ‌next ⁠parliamentary election is not due until 2028. It has never held an early election and analysts say the likelihood of one now is small as the opposition hard-right Alliance for Uniting Romanians (AUR) leads in opinion polls.

Centrist President Nicusor Dan, who nominates the prime minister, is now expected to invite parties for negotiations and attempt to rebuild the four-party pro-EU coalition under a different member of Bolojan's Liberals or perhaps a technocrat as prime minister.

The Social Democrats (PSD) have often said ​they would rejoin a pro-EU coalition ​under a different premier.

Bolojan's party ⁠has so far ruled out collaborating with the Social Democrats again, though some senior party members have pushed for reconciliation.

"There is life after the no-confidence vote," PSD leader Sorin Grindeanu told reporters. "We want to ​keep broadly this coalition."

A Romanian Liberal member of the European Parliament, Siegfried Muresan, called the alliance between the ​leftists and AUR ⁠in support of the no-confidence motion "anti-European".

"The formation of a new government will become their responsibility," he told Reuters.

However, Liberal deputy prime minister Catalin Predoiu said his party "must leave its options open".

Bolojan will stay on as interim premier with limited powers until a new government is approved by ⁠parliament.

Romania must continue to shrink ​its deficit as well as implement reforms in order to tap some 10 ​billion euros worth of EU recovery and resilience funds before an August cutoff date. The deficit is expected to narrow to 6.2% of economic output this year from ​more than 9% in 2024.