“ROMANIA – DEVELOPMENT STRATEGY” CONFERENCE Adrian Coman, Reff & Associates | Deloitte Legal: “We are faced with the fact that Romania does not have the capacity to absorb European funds; it is not necessarily true” – 25.04.2024

We face the myth that, in our country, there is a certain inability to absorb especially classic European funds, which is not necessarily true, at least from a quantitative perspective, stated Adrian Coman, Senior Managing Associate, Reff & Asociaţii | Deloitte Legal.

His Highness pointed out that, according to the Ministry of Investments and European Projects, for the programming period 2014 – 2020, an absorption of funds of approximately 94% was reported, and for the programming period 2007 – 2013, the degree of absorption amounted to approximately 90 %.

“From a quantitative point of view, we do not have an important gap. But from the perspective of the qualitative component, considering the relatively long period over which these sources of financing are circulated, it is possible and probable that, at some point, they will no longer be necessarily appropriate, for an intervention in a certain sector. This means that we should have a bit more discipline and organization to successfully modify these interventions during the execution of the exercises. Probably, from this perspective, a performance is felt weaker. Hence the idea that the Romanian State is not performing in this chapter (number of absorption of European funds). It is just that, from a qualitative point of view, this does not feel as good as it is seen from the point of view from a quantitative point of view”, said Adrian Coman.

The representative of Reff & Asociaţii recalled that our country has at its disposal approximately 80 billion euros, European money for investments and development, an amount coming from several sources – classic European funds, PNRR to which modernization funds are added, etc.

“I think that this opportunity that we have is the last in many respects. Once it is about the economic growth that Romania is experiencing, which is beginning to claim that the type of intervention that we are used to during programming periods, i.e. grants, is no longer the solution to follow in the long term. And it is likely that, little by little, especially in the context in which there are discussions regarding a potential enlargement of the European Union, we will see a transition from the role of net beneficiary to a role of contributor net. Or, this requires, in principle, a change of paradigm regarding the provision of complementary sources of investment financing”, said Adrian Coman.

According to the representative of Reff & Asociaţii, considering the availability of these non-reimbursable sources, Romania’s budget was built, in general, on a consumption-type approach, leaving investments to non-reimbursable financing. “The paradigm must be changed and we will have to assume this complementarity perhaps at the level of new state aid schemes and other interventions of the nature of financial instruments. It is a trend that we already feel, and the European Union was very clear in showing that the next programming period, which will start after 2028, will be dedicated to financial instruments – loans and other instruments that will facilitate economic development, but not grants”, said Adrian Coman.