VZCZCXRO0538
PP RUEHAG RUEHAST RUEHDA RUEHDBU RUEHDF RUEHFL RUEHIK RUEHKW RUEHLA
RUEHLN RUEHLZ RUEHROV RUEHSR RUEHVK RUEHYG
DE RUEHBM #0192/01 0471814
ZNR UUUUU ZZH
P 161814Z FEB 07
FM AMEMBASSY BUCHAREST
TO RUEHMO/AMEMBASSY MOSCOW PRIORITY 0837
RUEHC/SECSTATE WASHDC PRIORITY 6083
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE

UNCLAS SECTION 01 OF 02 BUCHAREST 000192 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE FOR EUR/NCE AARON JENSEN AND H MARK SMITH; MOSCOW 
PLEASE PASS TO CODEL LANTOS CONTROL OFFICER 
 
E.O. 12958: N/A 
TAGS: OREP PREL PGOV RO
SUBJECT: SCENESETTER FOR CODEL LANTOS VISIT TO ROMANIA, 
FEBRUARY 23-24. 
 
REF: BUCHAREST 00147 
 
1.(SBU)  Embassy Bucharest warmly welcomes your visit to 
Romania.  Some things have not changed since you last visited 
Bucharest almost six months ago.  Romania continues to show 
dynamic economic growth and the US-Romanian friendship and 
partnership in addressing common threats and interests is 
second to none.  The domestic political environment, on the 
other hand, has deteriorated significantly since last August. 
 Within weeks of Romania's accession to the EU on January 1, 
the center-right coalition government, already hamstrung by 
sharp conflicts  between President Traian Basescu's 
Democratic Party (PD) and Prime Minister Calin Pospescu 
Tariceanu's National Liberal Party (PNL), suddenly confronted 
a strong challenge from the opposition. 
 
¶2. (SBU)  The Social Democratic Party (PSD), led by former FM 
Mircea Geoana, and backed by other figures like 
former-President Ion Iliescu, accused Basescu of 
authoritarianism and various alleged violations of the 
Constitution.  On February 12, the PSD filed a motion to 
suspend President Basescu from office for 30 days and force a 
popular referendum on his Presidency.  There are apparently 
sufficient opposition votes in Parliament to make the threat 
a real one.  Analysts see a distinct possibility of Romania 
entering a period of political instability and government 
paralysis. 
 
¶3. (SBU)  Parts of Basescu's political problems are 
self-made; he was described famously by one opposition 
politician as "a lone wolf" and his style is direct and 
confrontational.  But he cannot be counted out of the fight. 
He retains a level of popular support that is unmatched by 
any other single politician in Romania.  It remains to be 
seen, however, whether he can face down both his critics 
within the governing alliance (including a Prime Minister who 
has considerable authority as the head of government), his 
diehard opponents in Parliament on both the right and the 
left, and the business and political-media oligarchs who 
resent what they argue are Basescu's selective targeting of 
corruption investigations.  (The President and his closest 
aides deny they interfere in the prosecutorial realm, 
insisting that judges and prosecutors are making independent 
judgments for the first time.)  This same configuration of 
center-left politicians from the last government, former 
Communists, right-wing nationalists and regional "barons" are 
also trying to unseat the Minister of Justice, whose efforts 
to fight corruption and reform the judiciary have earned 
plaudits both in Brussels and in Washington. 
 
¶4. (SBU)  The bottom line is that just a month after its 
entry into the European Union, Romania is facing the prospect 
of months of domestic political uncertainty and instability 
that could raise anew questions about the country's readiness 
to move beyond its legacy of post-Communist, oligarchic 
business and political interactions.  The good news is that, 
for the moment, there is still broad acceptance in the 
political class and among Romanians as a whole, in the 
importance of Romania's strategic partnership with the U.S. 
So far, the current political instability has stayed within 
legal and constitutional bounds, however torrid the rhetoric 
and vivid the theatrics. 
 
¶5. (SBU)  Meanwhile, we have emphasized that, while we cannot 
comment on the constitutional debate itself, it is important 
that the political issues be worked out democratically, 
transparetly and responsibly. We want to encourage Romania 
to build on the progress it has made in recent yeas in 
fighting corruption and strengthening the rle of law.  We 
want to discourage a turn of events politically which would 
leave irresponsible actors like the extremist head of the 
"Greater Romania" Party in a position to benefit from the 
turmoil.  We want responsible political leadership to sit 
down together and talk about their future and consider the 
consequences of a political implosion and the unintended 
results that could follow.  With one of the fastest growing 
economies in Europe, a talented workforce, and a strategic 
location on the Eastern rim of both NATO and the EU, Romania 
has a lot of positives with which to work, if only its 
political class can overcome its reliance on selfish, 
zero-sum politics. 
 
¶6. (SBU)  There is still much other work to do.  Human rights 
concerns continue to linger, including discrimination against 
minorities, like the Hungarians, the Roma, homosexuals, along 
with a continuing legacy of anti-Semitism.  The government 
recently passed a Law on Religions that provides government 
 
BUCHAREST 00000192  002 OF 002 
 
 
support only to well-established religions and discriminates 
against smaller groups by imposing burdensome registration 
requirements.  There has been agonizingly slow movement on 
post-communist property restitution, especially affecting the 
Greek Catholic Church.  While progress has been made in 
promoting broader acknowledgment of Romania's Holocaust 
history, anti-Semitism remains a rallying cry for certain 
right-wing politicians.  Inter-country adoptions remain 
blocked under Romania's 2005 law. 
 
¶6. (SBU)  The government of President Traian Basescu is 
anchored on a strong strategic partnership with the United 
States, with a focus on maintaining an outward-looking 
transatlantic foreign policy.  Romania continues to deploy 
around 2,000 troops abroad with NATO and Coalition-led 
operations in Afghanistan, Iraq, and the Balkans.  Still, 
some political actors, including influential members of 
Tariceanu's Liberal Party, oppose the Romanian commitment in 
Iraq.  You may recall last June when the Prime Minister, 
pushed by radicals in his Liberal Party who sought to 
embarrass Basescu, announced a plan to withdraw Romanian 
troops from Iraq without consulting the President or 
Romania's allies.  While Basescu and Defense Minister 
Frunzaverde recently have confirmed Romania will continue to 
meet its commitments in Iraq, some still hope to foster a 
parliamentary debate over Romania's troop deployments.  Your 
visit is an opportunity to emphasize that EU membership and a 
strong strategic partnership with the United States are 
perfectly compatible. 
 
¶7. (SBU)  While Romania has carefully fostered a close 
bilateral security and political relationship with the U.S., 
our economic and commercial relationship still has plenty of 
room to grow.  Since 2000, the Romanian economy has 
accelerated markedly, enjoying four to eight percent growth 
each year.  Recently, there have been encouraging signs for 
U.S. investment.  Many American companies are in Romania and 
are doing well.  Microsoft, Oracle, Timkin, Colgate 
Palmolive, Smithfield Foods and Hewlett Packard have all made 
recent substantial investments here.  Along with IBM, both 
Ford and GM are looking at further large investments in 
Romania.  Although hurt by delays, misperceptions, and 
misunderstanding, construction continues on the nearly 3 
billion USD Bechtel highway project through Transylvania. 
 
¶8. (SBU)  We continue to work closely with the government to 
help build industry's confidence in Romania's future. 
Following EU accession, however, the legacy of corruption and 
slow economic reforms continues to impede U.S. investment in 
Romania.  Poor infrastructure and labor rigidities also 
contribute.  You may wish to encourage GOR officials to work 
more closely with foreign investor groups like Amcham to 
adopt growth-promoting policies and to focus greater 
resources on infrastructure and stronger anti-corruption 
measures as a means of attracting greater foreign investor 
interest.  The passage of investigation and accountability 
laws to address issues related to conflict of interest, 
especially for the stalled legislation establishing a 
National Integrity Agency, would do much to increase 
investors, and citizens, confidence in Romania.  Your voice 
on the issue of combating corruption and promoting a Romania 
for everyone, and not just for economic and political elites, 
will have resonance throughout the nation. 
 
¶9. (SBU)  Finally, while we must be careful not to interfere 
in the ongoing political showdown between Basescu and the 
opposition -- with the Prime Minister operating somewhere in 
the middle -- you may have an excellent opportunity in your 
meetings to make the point that Romania needs political 
stability in order to continue to make progress.  In 
particular, the efforts both we and Brussels have encouraged 
to foster justice reform and combat corruption need to keep 
moving forward.  For the sake of its credibility as a NATO 
and EU member, and for its prospects in attracting investment 
to an economy that is only now starting to show real 
dynamism, Romania cannot afford to go back to a 
post-Communist, only semi-reformed future. 
TAUBMAN