C O N F I D E N T I A L SECTION 01 OF 04 BUCHAREST 000813

SIPDIS

SIPDIS

STATE DEPT EUR/NCE - WILLIAM SILKWORTH


E.O. 12958: DECL: 05/16/2016
TAGS: PREL PGOV ECON ETRD EFIN PHUM SOCI CASC KDEM
KJUS, KCOR, RO
SUBJECT: ROMANIA RECEIVES CONDITIONAL GREEN LIGHT FOR
ACCESSION ON JANUARY 1, 2007

REF: A) 2005 BUCHAREST 2240 B) BUCHAREST 724

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Classified By: DCM MARK TAPLIN FOR REASONS 1.4 (B) AND (D)


1. (C) Summary: The European Commission (EC) gave a
conditional green light May 16 for Romania's accession to the
EU on schedule on January 1, 2007. Although the EC did not
specifically recommend a date in its monitoring report on
Romania, local EU contacts and media observers note that the
overall positive tone -- as well as the specific omission of
a recommendation to delay entry -- represents a significant
step toward timely accession. The report specified only four
areas of concern, down from 14 in the last monitoring report
released in October, and all are related to technical aspects
of accession, primarily in agriculture. Local analysts
assess that none of the four would be significant to the
degree that they would delay entry. Language in the report
on the issue of international adoptions indicated no change
in the EC's overly sanguine assessment of Romania's child
welfare situation. By deferring a definitive announcement of
the accession date until October, EU contacts tell us the
commission seeks to maximize leverage to encourage further
reform. The immediate GOR response has been to portray the
report in a distinctly positive light. Nonetheless, EU
contacts tell us Romania will have to remain firmly on track
in implementing reform between now and year's end, and still
risks potential EU sanctions in several sectors even after
accession. End Comment.


2. (SBU) EC President Jose

Manuel Barosso and EC
Commissioner for Enlargement Ollie Rehn released the
long-awaited EC monitoring reports on Romania and Bulgaria
the afternoon of May 16, following a meeting of Commissioners
to discuss the final draft of the report. Romanian
television stations covered live remarks by Barosso and Rehn
from Strasbourg, where the two delivered the reports to the
European Parliament. Romanian Prime Minister Calin
Popescu-Tariceanu expressed optimism after the release of the
report but noted that Romania "still has a few points to work
on" to meet fully the criteria for accession. Perhaps
seeking to deflect attention from negative aspects of the
report, Foreign Minster Mihai-Razvan Ungureanu asserted that
the more important event is the June European Council
meeting, when member heads of state and government are
expected to discuss the report and provide further indication
of the mood in Europe towards Romanian and Bulgarian
accession.


3. (C) The report failed to make a definitive recommendation
for a January 1, 2007 accession for either Romania or
Bulgaria. It asserts that the two should be ready for
accession by that date, but postpones final determination
until the next monitoring report in mid-October.
Theoretically, the EC could invoke their safeguard clause
that would delay entry until 2008. Few analysts or local
contacts foresee such a negative outcome. According to the
local EC mission and many media reports, the omission
reflected a strong desire by many EU member states and
commissioners, particularly Rehn, to keep pressure on Romania
and Bulgaria to continue implementing reform and attacking
high-level corruption. The EC Mission DCM Onno Simons told
PolChief May 15 that the Commission also needed to show
member states that it was sensitive to concerns about the
continued pace of expansion, following the French and Dutch
"No" votes on the European constitution in 2005.


4. (C) Although there is no intention to de-link accession
for the two EU aspirants, early media reports have placed
Romania in a slightly better position than Bulgaria.
According to local EU contacts the EC is particularly
concerned about the latter's poor record in combating violent
organized crime, while on Romania they sought to support
activist Justice Minister Monica Macovei's efforts to clean
up the judiciary. The EC DCM Simons told PolChief that,
broadly speaking, the EC wanted to convey in its report on
Romania a strong message that the country is largely on track
with regard to accession, but could still run into trouble if
it fails to continue aggressively pursuing high-level
corruption cases or enters a period of political instability
during the remainder of the year. The same official asserted
that the EC sought to deliver almost the opposite message to
Bulgaria, notably that Romania's southern neighbor would "not
be able to enter the EU on time unless it addressed

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outstanding strong concerns."

What's in the Report?
--------------

5. (U) In general, the report documented substantial progress
by Romania in meeting EU requirements since the last
monitoring report released in October 2005. Indeed, Romania
moved from 14 areas of strong concern (commonly called "red
flags") to only four, which all apply to specific technical
aspects of accession. The first three "red flags" relate to
agriculture, specifically to a control system for ensuring
sanitary standards; food safety; and the mechanisms for
distributing EU funds to farmers (Ref B). The fourth relates
to taxation, specifically to Romania's computerized
collection of the VAT. None of these four would necessitate
delaying accession in the event that Romania failed to
complete them by year's end, although they could result in
negative consequences. Failure to complete the agricultural
requirements could trigger an internal market safeguard
clause that would delay access to the much-needed EU funds
under the Common Agricultural Policy (CAP). It could also
result in a ban in exports of some Romania animal products to
other EU members. Failure to complete reforms to VAT
collection could result in a continued customs presence
between Romania and other EU states until the issue is
resolved.


6. (C) Far more numerous were so called "yellow flags,"
areas requiring further progress before accession but not
receiving the same level of concern as the "red flags." Most
notably in this category is the reform of the justice system
and the fight against corruption. The report spares few
words in praising progress in the judiciary, which remained
one of the most persistent "red flags" in previous reports.
It commends the GOR for increasing impartiality in the courts
through random case assignments; increasing resources and
improving working conditions throughout the judicial system;
and abolishing the internal intelligence service within the
Justice Ministry, which had remained as a relic of communism
and served no practical purpose. EC mission DCM Simons told
PolChief that the EC sought to send a strong message that it
was extremely pleased with the extensive efforts of Justice
Minister Monica Macovei, a political independent who has
"done more for Romanian justice than any other justice
minister since 1989." Simons confided that many in Brussels
would like Macovei to be appointed as Romania's first
commissioner, although they saw that as unlikely given her
lack of political support in Bucharest.


7. (SBU) With regard to corruption, the report notes the
increased number of investigations of high level cases being
pursued by the National Anti-Corruption Directorate (DNA),
including against 14 members of parliament and past or
present cabinet members. Simons stated that the EC is happy
with the DNA, but views "with great suspicion" the intentions
of the Romanian parliament, which initially voted against a
key anti-corruption measure in February. Indeed, the report
lists the parliament as its first and primary concern with
regard to corruption, calling on legislators to stop delaying
the implementation of legislation and to establish an
independent agency for monitoring wealth declarations of
politicians and senior bureaucrats.


8. (U) Yellow lights also went to Romania in many other areas
such as care for the mentally disabled; prison conditions;
the rights of Roma and other minorities; and human
trafficking.


EC Digs in Heels on Adoptions: No Change in Tone
-------------- --------------

9. (C) Despite recent revelations about pervasive problems in
Romania's system for protecting orphaned and abandoned
children -- and repeated approaches from prospective adoptive
parents, the USG, and several EU member governments -- the EC
did not change its strongly supportive tone of Romania's
current system for child welfare and protection. As in
previous reports, it reiterates that Romania's law and de
facto ban on international adoptions implemented in 2005 is
"in line with EU norms." It also notes that the Romanian
Adoption Agency (ROA) had screened all the pending adoption
cases filed before the ban and declared them in eligible in
an ROA report according to schedule. The report also

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inaccurately asserts that the number of prospective adoptive
Romanian parents exceeds the number of children available for
adoption. The only criticism in this area relates to the
provision of social services for pregnant mothers and
ensuring access to maternity hospitals. According to the EC,
the overall situation with regard to child welfare had
"substantially improved."


10. (SBU) Earlier in the day, Romanian broadcast media
covered extensively a press conference by international
adoption foe and MEP Baroness Nicholson, with former Social
Democratic Party (PSD) cabinet member Alin Teodorescu.
Nicholson claimed that a recent condemning report released by
NGO Mental Disabilities Rights International had been "full
of inaccuracies" with regard to the state of Romania's
orphanages and other institutions. She applauded Romanian
efforts on child welfare and claimed that the Braila County
Council would sue MDRI over revelations about abysmal
conditions in a Braila psychiatric facility.


GMO - EU Ramps up the Pressure
--------------

11. (C) While the EC did not cite genetically modified
organisms (GMO) as a "serious concern," Commission officials
ramped up the pressure on Romania by highlighting in the
report GMO traceability and control as an area requiring
"increased effort" and "decisive action" in the main report
and all of its summaries. In the "Key Findings" summary, for
instance, GMO is one of only two examples under "increased
effort." Romanian farmers, who are strong supporters of GMO
seeds and their higher yields, have expressed a willingness
to buck regulations and continue planting. The Commission is
concerned that Romania will not strongly enforce new
EU-compliant rules on GMO cultivation. Romania could be a
strong partner for us within the EU on biotechnology, but
will be hard-pressed to deflect EU pressure with the date of
accession still up in the air.


Next steps toward Ratification
--------------

12. (SBU) In coming months, and concurrent with
deliberations within the EC and European Council, Romania
will also require ratification of its EU accession treaty by
all EU member states. Since the signature of the treaty in
April 2005, 17 out of 25 EU member parliaments have ratified
the agreement, to include all the ten new members that joined
the EU in 2004. Countries that have not ratified the treaty
to date include France, Germany, the Netherlands, Denmark,
Finland, Belgium, Luxembourg, and Ireland. EU member
diplomats in Bucharest have told post they anticipate no
problems with ratification by their parliaments, although
several have noted that their governments are awaiting more
definitive news from Brussels before moving forward in this
regard.


13. (C) Comment. Romania is clearly headed towards EU
accession on January 1, 2007. In any case, most of the
impetus in Brussels for holding back from a formal
commitment, according to a German diplomat and others based
here, was concern over Bulgaria rather than Romania. An EC
official summed it up tonight by saying: "It is 2007,
provided that.... with a final decision in October." The
only foreseeable impediment now to accession in 2007 would be
a major political crisis precipitated by the ongoing conflict
between Prime Minister Tariceanu and President Basescu.
However, even this appears unlikely given the high stakes.
Both palaces tell us the two leading parties in the ruling
coalition are prepared to ride out the next seven months
together despite their mutual animosity and incessant
plotting against each other. With timely accession now all
but certain, many in Bucharest are now focused on likely
post-accession developments. This includes anticipated
difficulty in absorbing the roughly 30 billion Euros in
structural funds that will be made available -- current
estimates are that due to inefficiency and poor preparation
Romania will only benefit from some 20 percent of the funds,
if that. Many observers are also concerned that Romania will
slow down -- or even reverse -- reforms that have
strengthened democratic institutions and provided hope that
the country will ultimately truly make progress in the fight
against corruption. In the words of one civil society

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leader, Romanians "won't know what to do after the EU stops
watching." The lack of precision in the May monitoring
report, however, ensures the EC will continue watching and
exercising its remaining leverage, at least for a few more
months. End Comment.


TAUBMAN