EU calls for changes in Romanian steel policy
On October 6 the European Commission published a progress report on
Romania's accession to the European Union.
According to the European Commission's report,
Romania's biggest obstacles are transparency of state aid and restructuring and privatization of the country's steel industry.
The report recognized the progress of
Romania in privatizing the country's two largest steel producers at the end of 2003 and the beginning of 2004, which completed the privatization of the Romanian steel sector.
In April 2004, the Romanian government approved an updated version of the document “Strategy for Restructuring the Steel Sector”. In comparison to the original strategy outlined in 2001, the new updated version of the strategy report included viability plans for the major steel producers. The new report calls for an increase in
production, sales and exports of Romanian steel products, increased utilization of existing
production capacity and a reduction in the number of employees in the Romanian steel sector.
However, the report was also careful to point out that the country will have to revise its policy on state aid in the steel sector before starting accession talks with the EU, especially in regard to the amount and intensity of state aid to be granted to individual companies in order to restore their viability. The report specifically states that important elements of any industrial policy are controlling state aid and ensuring the compatibility of support schemes with EC rules, both of which remain to be assessed.
According to recent reports, the steel question is reportedly the biggest issue in delaying the finish of the “competition section” of
Romania's accession negotiations with the European Union.