Romania has a plan for its future transport infrastructure. It must now turn paper into concrete
, 5th of October, 2016
The Foreign Investors Council (FIC) welcomes the adoption of the long awaited Transport Infrastructure Master Plan by the Romanian Government. This is an important step towards building the robust infrastructure Romania needs to ensure its long-term development and authorities and political parties must bear in mind that this is only a necessary first step.
The next one is to prioritize inside the Master Plan. Authorities must decide the projects they want to focus on in the next 3 to 5 years and make sure that these projects have the necessary financing and management capacity to be completed in time.
The Government, political parties and other institutional actors must be aware that European funds available (even with on absorption rate of 100%) are not enough to cover the costs of implementing the Master Plan. Romania must commit its own funds from the state budget and attract private capital where possible. In the medium term Romania should gain experience in developing public-private partnerships for projects which are commercially viable or where EU funds are not available.
The Ministry of Finance should also be open to provide a framework for multiannual budgeting at least for large scale and complex infrastructure projects. FIC encourages the Ministry to develop tools for capital expenditure (CAPEX) on infrastructure because such expenditure is of a non-recurring nature and results in acquisition of permanent assets.
FIC members also support the restructuring of the National Company for Roads and Highways (CNADNR) into two entities: one designed for maintenance and one solely focused on investments and the implementation of the Master Plan. We believe that an entity dedicated to infrastructure investments will increase efficiency in this area as long as:
- It has an appropriate corporate governance structure in order to ensure that it is properly managed; the new investment entity should comply with Law 111/2016 regarding corporate governance.
- It sits outside of political influence and focuses solely on building road infrastructure recruiting the specialists it needs for this task
- The restructuring of CNADNR should be done in such a way as to avoid any delays with the ongoing projects. One idea for ensuring a smooth transition would be to have a “task force” coordinated by a Vice Prime Minister with the Ministry of Transport, Ministry of Finance and the Ministry of EU Funds to work on financing, prioritization and feasibility studies.
FIC believes infrastructure is key for Romania’s future development and it is also one of the three pillars Romania must focus on if it is to become one of the top 10 EU economies, a message we are also conveying through our VAURMA.RO public campaign. According to the latest World Economic Forum Competitiveness Report Romania ranks 72nd out of 139 countries when it comes to the quality of its infrastructure. Speeding up investments in infrastructure will increase Romania’s competitiveness and help it attract more investments.