Sustainable development of Romania within the process of European integration.

Toba, Elena

Structure and development within economic theory

The increase in national wealth, in macroeconomic results per assembly and per inhabitant constitutes one of the preoccupations of decision factors from different countries and the main object of theoretic investigations and controversies.

Within the actual economic judgment there are expressed different opinions connected to economic increase and development (1). Considering these facts, the economic increase is defined as the process of increase in the dimensions of economic results determined by the combination and use of production factors and underlined by macroeconomic indicators--the gross domestic product, gross national product and national income in real terms, not only per total, but also per inhabitant.

The notions of economic increase and economic development should not be opposed one to another, nor do they superpose either. The two notions have some common elements: both processes are evolutional; they are based on the cooperation and use of the same factors; the social finality of both processes is represented by the improvement in the quality of people's lives. At the same time, the two notions contain elements that delimitate them. Thus, they have a different comprehension sphere. The economic increase supposes the quantitative increase in national economic dimensions, in the macroeconomic results per assembly and per inhabitant (GDP, GNP, NI). Synthetically, the economic increase is expressed through the rhythm of GDP, GNP, NI increase per inhabitant. Within the sphere of national economy (technological, inter-branches, economic-social, organizational, territorial etc), as well as the people's level of living. Any economic development also supposes an economic increase, but not all economic increase means economic development. The rapport between the two concepts is as from part to whole. Economic development, besides economic increase, associates and modifies its qualitative structures within national economy and quality of life. The concepts of economic increase and economic development are associated to the concept of economic progress, which underlines the specific and sense of development in each step, in comparison to anterior steps and constitutes the support of an optimistic view on the perspective evolution of society.

As a form of manifestation of macroeconomic dynamics, economic development supposes an assembly of quantitative, structural and qualitative changes not only in economy, but also the organizational mechanism and structures of functioning in the way of reflection and the behavior of human beings. Within this context, the concept of sustainable economic development appears, concept which represents that form of economic development within which it is wished to satisfy present consume requirements and not to compromise or prejudice the one of future generations.

The concept of sustainable development expresses the process of enlargement of possibilities through which present and future generations can fully manifest their options within any domain--economic, social, cultural or political, man being the centre of the development action.

Sustainable development is conceived within the visions of reconciliation between man and nature (2), of their equilibrium and harmony, "on a new means of development that should sustain the human progress, not only in a few places and for a few years, but for the whole planet and for a long future" (3). Essentially, sustainable development is a development that satisfies present necessities, without compromising the possibilities of future generations of satisfying their own needs.

The general objective of sustainable development is of finding an optimal point of interaction and compatibility of four systems: economic, human, ambient and technological, within a dynamic and flexible functioning process. The optimal level corresponds to that development of long duration that can be supported by the four systems. In order to realize a sustainable development, the minimal requirements include: re-dimension of economic increase, taking into account the accentuation of quantitative branches of production; elimination of exiguity under the conditions of satisfying the essential needs--work place, food, energy, water, house ad health; assurance of increase in population at an acceptable level (reduction of uncontrolled demographic increase); conservation of increase in human resources, maintenance of diversity of ecosystems, surveillance of the impact of economic development on the environment; technological reorienttation and control of their risks; decentralization of the governing forms, increase in the participation degree when taking the decisions concerning the environment and the economy.

A. Romanian National Strategy on Sustainable Development (5) partially reunites the requirements resulted from its quality of European Union Member State and continually necessitates completions and fundaments.

In the elaboration of the Romanian National Strategy on Sustainable Development it was ascertained that at the end of the first decade of the 21st century, after a prolonged and traumatized transition to pluralist democracy and market economy. Romania still has to recuperate considerably towards the other Member States to the European Union, simultaneously with the acquirement and transposition into practice of the main principles and practices of sustainable development within the context of globalization. In spite of all progresses realized within the past years, it is a reality that Romania still has an economy based on the intensive consume of resources, a society and an administration still searching for a unitarian vision and a natural capital affected by the risk of some deteriorations that can become irreversible.

The present Strategy establishes concrete objectives for the passing to the model of development that generates added value, propelled by the interest for knowledge and innovation, oriented towards continual improvement in the quality of life and the relations among them in harmony with the natural environment within a reasonable and realist period of time.

As a general orientation, the paper focuses on the realization of the following strategic objectives, in short, on a medium and long term:

Horizon 2013: Organic incorporation of the principles and practices of sustainable development within the assembly of public programs and policies of Romania, as E.U. Member State

Horizon 2020: Reaching the actual medium level (with reference to the number of the year 2006) of EU--27 according to the basic indicators of sustainable development.

Horizon 2030: Significant approach of Romania towards the medium level from that year of the Member States of the EU from the point of view of the indicators of sustainable development.

The text is structured in 5 parts:

Part I presents the conceptual frame, it defines the notions used, it describes the main points of the Renewed Strategy for Sustainable Development of EU (2006), the actual stage of the process of elaboration of basic indicators of sustainable development and relevant measures taken by Romania within the pre- and post-accession period.

Part II contains an evaluation of the actual situation of Romania's natural, anthropic, human and social capital. This approach is according to the last recommendations (May 2008) of the combined EU Work Groups of Statistic Department (Eurostat), the UN Economic Commission for Europe (UNECE) and the Organization of Economic Cooperation and Development (OECD) concerning the measurement of performances of sustainable development according to the evolution of the four forms of capital.

Part III offers a perspective vision, establishing the precise objectives on the three time horizons, strictly following the logic of key challenges and inter-sector themes, as they are mentioned within the Renewed Strategy for Sustainable Development of the EU.

Part IV analyses specific problems that Romania confronts with and establishes targets for the acceleration of the process of passing to a sustainable development, concomitantly with the reduction and elimination of the existent gaps regarding the medium performance level of the other Member States of the European Union.

Part V contains concrete recommenddations concerning the creation and modalities of functioning of the institutional frame in order to assure implementation, surveillance and rapport on the results of Renewed Strategy for Sustainable Development. The proposal considers the experience and practice from the other EU Member States and focuses on the adoption of some innovative solutions, adapted to specific conditions of Romania, concerning the responsibilities of public authorities and active implication of social factors in realizing the objectives of sustainable development.

The problem of elaboration of the Strategy for Sustainable Development of Romania was more obvious in 2006, from the perspective of our country's accession to the European Community. The creation of a National Consultative Council and of regional councils of sustainable development contributed to the intensification of the effort of accumulation, synthesizer and partition of a huge documentary and prevision material existent at the level of branches, sectors, basic products and public services that compose the structure, infrastructure and superstructure of Romanian society from the first part of the 21st century. They took into account the other national spread documents, including the pre-accession and post-accession strategies.

The Project of the strategy for Sustainable Development of Romania is an integrator document, the first with such amplitude after 1989 and it is concerned with a few essential provocations that humanity confronts with, in the new millennium. Energy, food and environment are considered a priority under the conditions of the disappearance of natural resources and the alarming increase in environmental polluting and destroying factors. The strategy establishes the development frame on a long term, the way in which economic structures support the established objecttives. However, it is not an economic and environmental strategy, but a synthesis of all elements that may assure the sustainable development of the country.

B. The elaboration of scientific documents of Romania's development should start from the actual realities of our country.

Romania is an energofagus country, consuming more energy than the European average: with a value of four billion dollars a year. The 85,000 flats consume circa 65% from the electrical energy of the country, where the necessity of efficiency of the whole economic system. The economic increase was based on consume of products, not on added value. Concerning the use of natural resources, in Romania there does not exist any town with the management of integrated water. Within the urban area, the centralized drinking water system represents circa 65%. We have an enormous deficit of specialists capable to elaborate eligible projects for European financing.

We earn and we borrow even more, but we consume almost the whole amount. The management and financial projections are lacking at the level of houses, not only concerning incomes, but also concerning expenditures and loans. Present needs dictate us the consume behavior, and to the future we reserve the strategy "we shall live and we shall see". The risk of living in debt could now reflect on banks, under the conditions of diminishing the access to alternative financing resources, internal or external.

Salaries supply over half from the total incomes of Romanian houses, and social activities circa one fifth, during the second trimester of the year 2008. Without some economy stimulation instruments, the Romanians allotted their average monthly incomes (of2,046 lei per house and 702 lei per person) in a proportion of 90% of the consume [5].

* The Chinese earn almost one dollar per hour, from which they save 40%, and the rest is consumed. The Romanians earn better than the double of the Chinese, but they save circa 10%.

* Others will enjoy the fact that we are situated on a better position than the Americans who earn 24 dollars per hour and spend 25. It is not quite so: consume credits dominate the whole part of populations' debts.

INS also tells us that from the total consume of the households, circa 43% are spent on food and non-alcoholic drinks, 7% on clothes and shoes and almost the same on alcoholic drinks. Evidently, the most part of Romanian acquisitions within the urbane area is realized within retail store commerce. Within the rural area, 40% of food is still assured from auto consume.

* Fulminatory actual increases--with tens of percentages--at salaries, pensions, compensations, to which a new increase of the minimum salary to 600 RON starting with 1st January 2009 will certainly supply the consume as value volume.

* In real term, the prices' intensification will fuel inflation and will diminish the buying capacity.

* The budgetary impact of all salaries and social increases within the past year (1st October 2007-1st October 2008) reaches 3,5% from the domestic intern product estimated for the year 2008.

The consumer behavior of Romanians has been directly influenced by the stimulation of crediting, to the cost of saving. The difference between active and passive interest (namely between credits and deposits) maintained at an exaggeratedly high level for a period of 16 years. The profits of the banking system have been huge. Within the past two years, the differrence of interest started to drop significantly. But savings moved slowly on an ascendant scale.

The Romanians take loans to consume: over 90% for the debts of population are represented by the consume credits.

More concretely, starting with the second half of the year 2007, the population becomes net debtor towards the banking sector. The only exception is represented by the region Bucharest-Ilfov.

But, per assembly, the weight of the credits offered to the population in DIP is inferior to the countries from the euro area. Such comparisons are less too relevant. Romanians are more indebted than European citizens if we compare the credits at the level of incomes. The differences are even more increased if we rapport these credits to the level of the declared fiscal incomes to which we add a maximum of 20%, according to the new rules of RNB.

We think that the tightening of crediting norms represents the correct solution, but too late. Until now, both fundamental purposes of efficient crediting norms have been missed: of reducing the non-reimbursement risks, respectively of stimulation of productive credits against the ones for consume. We will witness more and more financial drowning of the crediting persons, but we still protect the one from the surface.

Actual pressures on consume are partial reciprocally annulled. On the one side, the available incomes are increasing. On the other side, the interests at credits are even more costive, and the credit allowance conditions are more restrictive. The important depreciation of the Leu is added here. The population is completely uncovered towards this exchange risk.

Thus, Romanians find themselves in the unpleasant situation of reimbursing a sum greater with 10% in lei for credits in Euro, to which the increases of interest rates are added.

The optimism of the consumer, that in future years he obtains greater incomes, and the reduced perspectives of unemployment fuel on the other side the request for consume credits.

Presently, in Romania, the population consumes with 20% more than it produces. There is no high added value at Romanian products, the change being imposed according to economic rationalization, of competitive finality for products and services. The main objective of sustainable development is the increase in life quality for all social categories. Presently, the economic increase is based on consume, not on production, and the consume increases the imports. Although, sometime, it was considered "Europe's barn", Romania of the 21st century imports over 60% from agrarian products. Even salt is imported by the country of the salt mountains! The efficiency of resources is an essential challenge for the future decades. Agriculture remains the main "alcove" of our sustainable development, with the 14 million hectares of agrarian land, from which 7 million of arable land. The cultivation of ecologic products is vital.

Ecologic agriculture, balneal therapeutic tourism and the Black Sea connected to the Caspian Sea, both rich in hydrocarbons are considered to be the main resources for sustainable development of Romania. Demographic crisis and education are other priorities to which the Romanian state should find radical solutions, under the conditions of a decline of 1,6 million inhabitants, plus 3 million who work abroad, within mentioning annual retirements.

C. The National Strategy of Sustainable Development of Romania should comprise new directions in order to facilitate the EU integration.

Among all these, more important are the following:

* Elaboration and attachment within the National Plan of Development of a special chapter regarding the development and modernization of industrial activities recommended by the EU.

* Elaboration of another special chapter regarding technical endowment, increase in productivity and improvement of the crediting system of agriculture.

* State support for the re-launching of scientific research, that should ease the modernization of economic activities.

* Attraction of a high volume of direct foreign investments.

* Re-thought of fiscal and currency economic policies according to the requests formulated by the EC and the IMF.

* Government surveillance that each external credit employed directly serves the economic production objectives.

* Rationalization of expenditures from public money, by simplifying all administrative structures at national and local level, starting with the Parliament and local administrations.

* Reduction of commercial gap and of the current account on the basis of modernization of industry and agriculture, as well as of the development of energy production on the basis of regenerable resources.

* Rational correlation of the development objectives, including of investment programs, for inter-sector and regional profile, with potential and capacity of sustenance of material capital;

* Accelerated modernization of the systems of education and professional training and public health, considering the unfavorable demographic evolutions and their impact on labor market;

* Use of the best ecologic and economic available technologies in investment decisions from public funds on national, regional and local plans of such decisions from private capital; firm introduction of the criteria of eco efficiency within all production or services activities;

* Anticipation of the effects of climatic changes and elaboration of some acclimation solutions on long term and of some plans of measures of inter sector contingency, comprising portfolios of alternative solutions for crisis situation generated by natural or anthrophic phenomena.

* Assurance of alimentary security and safety, including through valorization of comparative advantages of Romania concerning organic agriculture; correlation of the measures of quantitative and qualitative increase in agrarian production in order to assure the food for people and animals with the requests to increase the production of bio combustibles, without reduction from the exigencies regarding maintenance and increase in soil fertility, biodiversity and environmental protection;

* Protection and valorization of the cultural and natural national patrimony; compression to European norms and standards regarding the quality of life together with the revitalization in modernization of some means of traditional living, especially within mountain and wet areas.

Notes

(1) S. Kuznets, Economic Growth and Structural. Selected Essay, Heinemann Educational Books Ltd, London, 1966, p. 6; H.W. Arndt, The rise and Fall of growth, H. Study in "Contemporary Thought", Longman Chesire Pty Limited, Melbourne, 1978, p.1; Fr. Peroux, Pour une philosophie du nouveau developpment, Les Press d'UNESCO, Paris, 1981, p.13.

(2) Brundtland Report, "Our Common future", elaborated by the Environment and Development Independent World Commission, presented at the UNO Conference from Rio de Janeiro, June 1992.

(3) Economia si sfidarea naturii, Economic PH., Bucharest, 1994, p.13.

(4) Romanian Government, The project of the Strategy for Sustainable Development of Romania, Version V from 15th May 2008.

(5) The calculus was realized based on the data delivered by the National Institute of Statistics, Bucharest.