Romanian Party Makes New Pick for Premier to Avert Crisis

  • Social Democrats nominate Sorin Grindeanu for prime minister
  • President Iohannis must respond to proposal in coming days

Romania’s Social Democrats nominated Sorin Grindeanu to lead the next government in a bid to avoid a political crisis after their previous pick was rejected by President Klaus Iohannis.

Grindeanu, 43, served as communication minister in the government of former premier Victor Ponta. Party leader Liviu Dragnea, who can’t take the post himself because he was previously convicted of rigging a referendum, said if Grindeanu’s nomination is rejected, his party will start procedures to suspend the president. Iohannis, who is expected to announce his decision within days, considers Grindeanu a better proposal, reported on Thursday, citing unidentified officials from the president’s office.

“We’ve chosen not to throw the country into political crisis, and we decided to propose a person who’s loyal to the party and the governing program,” Dragnea told a news conference on Wednesday in Bucharest. “I hope the president will take this proposal very seriously.”

The Social Democrats won the most votes in Dec. 11 elections a year after public outrage over corruption pushed Ponta out. They have a majority in parliament with their junior ally, ALDE, and are aiming to form a new government. Iohannis called on the coalition on Wednesday to choose another candidate after he rejected Sevil Shhaideh, a former development minister with little previous political influence. He didn’t give a reason.

Leu Weakens

A delay in installing a government risks undermining one of the fastest paces of growth in the EU by delaying investment and the tapping of development funds, an area where Romania has ranked last in the 28-member club. Iohannis has the constitutional right to name a prime minister and reject any candidate who he doesn’t consider fit for the job. The president’s spokesman didn’t respond to calls seeking comment.

The leu gained 0.1 percent to 4.5372 per euro at 4:17 p.m. in Bucharest, rebounding from the weakest level since January. The currency has lost 0.3 percent against the euro this year. The economy has outperformed its eastern European peers in growth, expanding by 4.4 percent from a year earlier in the third quarter.

“The leu has already started selling off, though as a very heavily managed currency we will never see that much movement,” Peter Attard Montalto, a London-based economist at Nomura International Plc, said an e-mailed note. “Markets are also increasingly looking to Romania as a key ‘local market’ story for 2017, and the political crisis could fuel further expectations of earlier rate hikes by the central bank.”

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