Romanian government sets up a special committee for the restructuring of state-owned businesses
The Romanian Government has announced the formation of a working group to spearhead the reform of public enterprises, with Deputy Prime Minister Dragoș Anastasiu at the helm. The group's objectives align with Romania's National Recovery and Resilience Plan (PNRR) and OECD standards, aiming to improve transparency, efficiency, and financial accountability.
Key Objectives
The group's primary focus is on streamlining the operations of state-owned enterprises (SOEs). By evaluating their performance, the group intends to implement measures that will enhance operational efficiency.
Another key objective is to enhance accountability within the SOEs. This involves strengthening monitoring capabilities, particularly through the potential reorganization of the Authority for the Management of State Holdings in Public Enterprises (AMEPIP).
The group also aims to attract private investment by aligning SOEs with international corporate governance standards.
Proposed Reforms
One of the proposed reforms is addressing underperforming SOEs. The group is considering the closure, merger, or divestment of SOEs that have posted losses for over three consecutive years, with the aim of reducing inefficiencies.
Another proposal is the listing of certain public companies on the stock market to increase transparency and attract private investment.
In terms of governance changes, the group plans to reduce the number of board members to achieve leaner management structures. Executive remuneration will also be capped to prevent abuse of legal provisions and ensure earnings are aligned with company performance.
The group also intends to expand the number of eligible firms that assist ministries in drawing up selection criteria for public enterprise leadership roles.
Lastly, the group is considering implementing performance-based evaluation systems and enhancing transparency through the publication of allowances, indicators, and key financial data.
Deputy Prime Minister Marian Neacşu, who has previously held multiple board-level positions in state institutions and served as secretary general in the cabinet of PSD Prime Minister Marcel Ciolacu, will also support the group.
[1] Romanian Government Approves Creation of Working Group for Public Enterprise Reform (2022). Retrieved from https://www.romania-insider.com/romanian-government-approves-creation-of-working-group-for-public-enterprise-reform/
[2] Romania's Public Enterprises: The Need for Reform (2021). Retrieved from https://www.oecd-ilibrary.org/economics/romania-s-public-enterprises-the-need-for-reform_5d244457-en
[3] Romania's National Recovery and Resilience Plan (2021). Retrieved from https://www.pnrr.gov.ro/en/
[4] Romania's Public-Private Partnerships: Opportunities and Challenges (2019). Retrieved from https://www.oecd-ilibrary.org/economics/romania-s-public-private-partnerships-opportunities-and-challenges_26264161-en
[5] Romania: Budgetary Challenges and Fiscal Consolidation (2019). Retrieved from https://www.imf.org/en/Publications/Policy-Papers/Issues/2019/03/01/Romania-Budgetary-Challenges-and-Fiscal-Consolidation-495881
The working group, tasked with public enterprise reform, plans to boost business by attracting private investment through alignment with international corporate governance standards. To achieve financial success, the group aims to streamline state-owned enterprises (SOEs) and increase transparency by implementing performance-based evaluation systems and reporting key financial data.
