Romania lags behind in attracting EU funds for CEE transport infrastructure

Romania attracted less than 7% of the EU funds spent in Central and Eastern Europe for transport infrastructure between 2007 and 2013, according to the PwC and the Atlantic Council report The road ahead – CEE transport infrastructure dynamics.

“In the 2007-2013 financial exercise, out of the total of EUR 82 billion of structural and cohesion EU funds spent in the CEE for transport infrastructure, Romania attracted less than 7%, while Poland accounted for over 30%,” said Ruxandra Chiriţă, director, Public Sector Services with PwC Romania.

The country has one of the lowest scores in the EU in terms of infrastructure quality and needs massive investments and improvements in this area, according to the authors of the report. It had a 3.61 score for the quality of its infrastructure in the Global Competitiveness Index published by the World Economic Forum. By comparison, the average for the EU 15 countries is 5.65 and the CEE average score is 4.02.

More than 5,600 Km of new motorways were built throughout CEE since 1995. Romania has increased its total motorway length by 470% between 1995 and 2013, second to Poland’s growth of 502% and ahead of Hungary’s 427%.

In its part of the Rhine-Danube Corridor, Romania has several sections it needs to further develop or address. It is the case of the Arad-Craiova and Craiova-Bucharest sections of the TEN-T core route in Southern Romania, among others.

The Rhine-Danube Corridor connects France, Germany, Austria, the Czech Republic, Slovakia, Hungary, Croatia, Romania and Bulgaria along the Rhine, Main and Danube rivers to the Black Sea.

Romania is also home to one of the ten flagship projects the European Investment Bank (EIB) has in the region. It concerns the construction of the sections I & II of the Bucharest Metro Line 5, and it received an EIB contribution of EUR 860 million.

In the rail sector, the country has cross-border projects where financing is a critical issue in the case of the network parts crossing non-EU countries. These do not enjoy the same benefits of EU funding as the EU13.

“Currently, Romania has on-going cross-border rail projects with 4 out of its 5 neighbors: Hungary, Bulgaria, Ukraine, and Republic of Moldova. While the cooperation with the two EU neighbors benefits from the inclusion of both borders in the two Core Network Corridors crossing Romania, the cooperation with Ukraine and Moldova lacks the necessary public interest and funding,” explained Marius Chiper, the general manager of the Romanian National Railway Company CNCF CFR SA, quoted in the report.

Overall, the broad CEE region needs another EUR 615 billion in further transport infrastructure investment through 2025, the report found.

“Despite progress in recent years, there is still a great deficit throughout the CEE for more efficient and modern transport infrastructure. It is clear that the need for financing these infrastructure projects is far greater than the current possibilities of the national budgets of the countries in region, including Romania. That is why it becomes paramount to identify additional financial resources in the private sector, by implementing a viable Public-Private Partnership legislation. Unfortunately, although in Romania we have the basis of this legislation, it still lacks the application norms, being not-functional at the moment”, Ionuţ Simion, Country Managing Partner with PwC Romania, said.

The full report can be read here.

[email protected]