Romania country brief
Bilateral relations
Australia and Romania share a relationship based on commercial linkages and community ties. According to the 2006 census, there were 12,950 Romanian-born people living in Australia, with the majority residing in New South Wales and Queensland. It is estimated that there are a further 16,000 people living in Australia who are of Romanian descent.
Diplomatic relations between Australia and Romania were established in 1968. Australia is represented by an Honorary Consulate in Bucharest. Australia's non-resident Ambassador to Romania is based in Belgrade. Romania has an Embassy in Canberra, a Consulate-General in Sydney and an Honorary Consulate in Melbourne.
In 2008, Australia’s two-way trade with Romania was A$259 million (up from A$146 million in 2006). Australia’s trade in services with Romania is negligible. Main exports to Romania were coal and other ores and concentrates. Australian imports of Romanian merchandise have grown in recent years including inorganic chemical elements, clothing items and rubber tyres.
Bilateral Agreements
Romania and Australia have concluded an Investment Promotion and Protection Agreement, a Trade and Economic Agreement (signed with full effect for Australia in July 2002 and for Romania in January 2003) and an Agreement for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion, signed in 2001.
High level visits
Prime Minister Kevin Rudd attended the NATO Summit in Bucharest in April 2008.
An Australian Parliamentary delegation led by Senator Alan Ferguson, the then Chairman of the Joint Standing Committee on Foreign Affairs, Defence and Trade, visited Romania in April 2003. The purpose of the visit was to lead an Inquiry on the potential for Australian trade and investment in Central Europe. The Inquiry concluded that there were good prospects for Australian companies to further expand trade and investment with Central European countries, including Romania. The full report can be found on the Parliament House website. An Australian Parliamentary delegation to Romania was led by the then President of the NSW Legislative Council in July 2002.
The Speaker of the Chamber of Deputies of the Romanian Parliament, Mr Bogdan Olteanu, visited Australia in September 2006 with a business delegation. The Romanian Deputy Minister responsible for relations with the diaspora, Christian Niculescu, visited Australia in October 2001, principally to meet with the Romanian community. Former President Emil Constantinescu visited Australia in September 2000 for the Olympic Games. Romania's then Defence Minister Mr Ioan Mircea Pascu, visited Australia in April 2000.
Political overview
Under the 1991 Constitution (revised in 2003), Romania has a presidential political system. Under this system, an executive President is elected directly for a maximum of two five-year terms and acts as the Head of State. While in office, the President must renounce all party positions and affiliations. The President is the Commander of the Armed Forces, represents the State in foreign relations and may take part in Government meetings to discuss issues of national interest.
Amendments to the Constitution, passed in October 2003, extended the Presidential term from four years to five. The 2009 Presidential election went to a runoff on 6 December, with incumbent President Traian Basescu claiming a narrow victory. Basescu was sworn in for a second term on 16 December.
The legislature comprises two chambers: the Chamber of Deputies (332 seats) and the Senate (137 seats). The Constitution gives Parliament a central place in the system of state authorities. It has power in exceptional circumstances to dismiss or suspend the President.
The President appoints the Prime Minister based on parliamentary elections, most recently held in Romania on 30 November 2008. A single constituency voting system was used for the first time, with run-offs between the two leading candidates if necessary. The system replaced the use of party lists, where citizens voted for a whole list of party-nominated candidates, rather than a single candidate. Parties are still however required to cross the threshold of 5% of the total vote to obtain representation in Parliament.
Following the elections, Democratic Liberal Party (DLP) leader Emil Boc was sworn in as Prime Minister on 22 December 2008. Prime Minister Boc’s ruling coalition, consisting of the DLP (115 seats and 33% of the vote), and the alliance of the Social Democratic Party and the Conservative Party (114 seats and 33.6% of the vote), collapsed in September 2009. Several attempts to appoint a new Prime Minister have failed and negotiations continue.
The National Liberal Party (with 65 seats and 18.7% of the vote) and the Hungarian Democratic Union in Romania (22 seats and 6.3% of the vote) are the main opposition parties.
Foreign policy issues
Romania's overriding foreign policy priority remains strengthening relations with other European countries and the United States through its membership of both the European Union and NATO. Romania joined the European Union on 1 January 2007.
Romania has been a member of NATO since 2004. It hosted the Bucharest NATO Summit in April 2008. There is strong public support for Romania’s NATO membership, which is seen by Romanians as an important guarantor of stability in its immediate region, both in a strategic sense and also politically and economically. There are also hopes that closer integration with regional and international organisations such as NATO will attract further foreign investment. Romania has made modest but significant contributions to military deployments in Afghanistan and Iraq. Romania also has an agreement with the US on American access to Romanian military facilities.
Economic overview
Romania has a population of 22.2 million (2009 est.), GDP of US$271.2 billion and an estimated GDP per capita of US$12,200 (2008 est.). Principal export destinations are Germany, Italy, and France, while the main import sources are Germany, Italy and Hungary (see Romania - Fact Sheet). Romania's economy is largely based on services, which contribute 55.9 per cent of GDP. Industry constitutes the second largest sector at around 36 per cent, followed by agriculture at 8.1 per cent (which provides employment for about 29.7 per cent of the labour force).
Romania’s economy had improved markedly with GDP growing by an average of more than 5 per cent from 2000 to 2008. Romania’s strong growth performance had been a result of a number of factors, including a stronger political commitment to reform, post-recession recovery, strong foreign direct investment, greater macroeconomic stabilisation and the country’s strong export performance.
The Romanian economy is however increasingly affected by the global economic crisis. The European Bank for Reconstruction and Development (EBRD) reduced growth estimates for Romania in 2009 to 1 per cent from the initial estimate of 3 per cent. Unemployment is on the rise. The National Bank of Romania recorded unemployment at 5.8 per cent in May 2009, compared to 3.8 per cent in May 2008.
Updated: 21 December 2009