IULIAN FOTA: "The deprofessionalization of the administration is becoming more dangerous than the economic crisis itself"

Reporter: Europe has been heavily shaken by the economic crisis. Is the European project still sustainable?

Iulian Fota: At this moment, starting with the US and going through all the European countries, the economy is considered the most important matter of national security.

And this isn't an exaggeration. Why? Because the economy is truly the foundation of the national security effort.

National security requires money to organize yourself and to defend yourself, you need resources, you need capabilities. The moment the economy is affected, national security also becomes vulnerable. In the end, let's not forget that the Soviet Union fell apart not as a result of a military aggression, but rather because from an economic point of view, it has collapsed and was no longer capable to meet the needs of its population in a satisfactory manner. The economy is currently a matter of national security for everybody.

A second very important thing is the public opinion. The legitimacy of the efforts in the area of national security comes from the support of the public opinion.

Reporter: Just like the USSR collapsed because of economic problems, isn't it possible that the UE will see a similar thing happen to it?

Iulian Fota: There is a major difference between the Soviet Union and the European Union: the EU belongs to the space of democracy, of open debates and of a developed spirit of criticism. When the European Union has a problem, nobody runs from it, nor do they hide, like it happened for years in communism, when we all knew how badly we were doing, but no one had the courage to start a discussion about those problems. The European Union will not have the same fate as the USSR because it is aware of its problems, it deals with them openly, head-on. It's true that we have problems, just like the Americans, in fact, we did buckle a little under their burden, but we are far from being in a decline. After all, a crisis is also a challenge, as well as an opportunity.

Reporter: President Traian Băsescu, in his speeches, speaks of two European factions moving at different speed lanes.

Iulian Fota: That this not something that is being forced upon our country by someone else - it is up to us whether we are in the first or in the second Europe.

The Union does not decide on the performance of a country, the whole responsibility falls on that country itself. I am not the supporter of a theory that someone from outside is trying to keep us down.

We are there because this is our performance as a country, but there is nothing stopping us from progressing and raising towards the middle of the ranking or towards its top. Our performance depends first of all on us, on our domestic power, on our cohesion and competence. Personally, I am concerned when I see important people from outside the country who say that Romania can't be governed. That kind of statement should be treated with the utmost seriousness. It is a troubling rhetoric, it's like someone trying to send us the message: "You are second-rate Europeans!"

Reporter: Mr. Gunther Oettinger recently said that Romania is non-governable and he still hasn't retracted that statement.

Iulian Fota: That kind of statements isn't fair to us, because Romania's performance has been very good in certain areas.

On the other hand, I think that before clinging to this kind of statements, we need to look more closely to what we are doing domestically. From my point of view, there are some things that we need to improve.

In order to achieve such a goal, we need to fight two factors which are extremely harmful: greed - sometimes I feel like people are putting their own accounts above the nation's interest- and the deprofessionalization of the central or local administration. The increase in incompetence which we are increasingly running up against can easily be explained when looking at things such as the quality of education.

Reporter: Education is indeed, a very serious problem.

Iulian Fota: It is a paradox, but on that matter, we are the opposite of the EU, and I am speaking about a dangerous antithesis. While the European Union is looking to pursue a knowledge-based economy, where intelligence is the foundation, when it comes to intelligence and skills, Romania doesn't seem to tap them appropriately. The competent people in Romania have been marginalized or even systematically destroyed by the political parties through the politicization process which they are not stopping and they don't control anymore.

On the other hand, the mass-media, especially some TV channels, have contributed to the propagation of this phenomenon, which has contributed to replacing information with manipulation, in many cases.

I am also very worried by the disappearance of the printed press because based on the old Latin adage "verba volant scripta manent", what really matters is what remains on paper.

And in Romania, the media landscape is built on a Russian rather than a Western model, namely 80% of people get their information from TV stations, there are sociological polls which prove that is the case, and the quality of the information supplied by the TV stations is the one we all know: lots of superficiality, everything is rushed, a lot of sensationalism and a bit of ill-will. We are however keeping a minimal chunk of good quality written press on the political and economic segments; this is actually what I define as the real European mass-media in Romania.

Reporter: There is frequent talk about the undermining of the national economy and of the national interest being replaced by that of various interest groups, rallied around the political parties. How would you describe such a statement?

Iulian Fota: Everyone is speaking about such an act, but nobody is saying who is undermining the national economy.

What I've seen, over time, was how we have undermined our own economy. How many Romanians were involved in the bankruptcy of Bancorex, of the Agricultural Bank, for example, or of other banks in the 90s and how many were foreigners? Depending on the answer to this question, we will eventually realize who contributed to the undermining of the Romanian economy. I won't deny the ill will of some people or the desire of some of them to make out a profit at any cost, including at the expense of our country and of our people.

In spite of all this, no one can harm the country's economy as badly and as significantly as we Romanians can.

The matter of the Westerners who are harming the economy is in my opinion superficial. Indeed, some Western companies, out of incompetence or ill-will, sometimes, did not do what was good for us, but in each such individual situation, the Romanian government had enough means of pressure and tools to take all the necessary steps of protection and to punish the company in question.

If the state had no reaction at all, this is strictly tied to our own incompetence, or perhaps to our corruption. And the problem once again lies with us, not with them.

Let's take the example of privatizations: on one hand we want to be a capitalist country, and on the other hand, we currently have a problem with the process which is fundamental in the transformation of a communist country into a capitalist one, namely privatization.

The privatization process isn't wrong - it is bad to do a harmful privatization, with small fry companies that have no interest in acquiring the company being privatized and developing it.

It is bad to do privatizations based on corruption.

The process in itself is not wrong, as proven by the fact that other countries have used it successfully and with remarkable results, one positive example being Poland.

Why is the Polish economy doing better than that of Romania?

Because the Polish state did its privatizations a lot smarter than we did.

If we are still selling state companies, like we did in the 90s, to unknown companies or we give them on a platter to political cronies for a dime, we shouldn't get mad, after that, that the outcome isn't good.

When we did good privatizations - when we chose strategic investors, reputable names, which were brands in their sector, with reasonable business plans - everyone gained: people got jobs, the state collected the taxes it was owed etc.

Reporter: Lately, we are noticing that foreign investors are avoiding Romania ...

Iulian Fota: Romania comes after a period where it has slowed down the privatization pace, maybe even shut it down.

Resuming this process is a delicate and difficult process. You need to understand the markets, the mechanisms of investors.

Therefore, resuming the privatization process isn't easy to do. We are talking about a process which involves certain steps, perhaps even certain small sacrifices.

Nevertheless, for Romania it is crucial to resume the privatization process.

If one looks at the capital inflows, the money which Romania needs, there are only two channels: European funds - the cheapest money that Romania has access and which need to be absorbed 100% - and what can come into the country following the privatizations.

Of course there is also the stock market (an institution which is fundamental for a capitalist country), but in Romania, it remains underdeveloped.

It is worrisome to see Romanian companies get listed on foreign stock exchanges to raise funding, when they could do that on ours.

Reporter: There are certain talks about the possible merger between the BSE and the OPCOM, from the entry of the state as a shareholder of the BSE to help revitalize the stock exchange...

Iulian Fota: As a last resort, it depends on what we want: whether we do indeed want to contribute to the country's development.

150 years ago, the old liberals knew how to build a stock market and what to do with it, and today, after so many decades of accumulating know-how in the sector of economics and finance, we don't know how to manage it profitably.

The stock market needs a development plan set up by very good economists, so that in four or five years, it will be solid enough to finance small and major Romanian companies.

Reporter: The projects concerning shale gas and the mining of gold at Roşia Montană have sparked numerous reactions nationwide. Furthermore, we are seeing a shift in the position of the government on the subject, as last year it was against starting such projects, and currently they look more inclined to give a favorable permit ...

Iulian Fota: Being in the opposition, when you can say anything and it won't cost you a thing, and being in charge and having to give people what you promised, including jobs, are two different things.

On the other hand, the public debates on both topics had not been conducted by experts, but by the demagogues or the populists in charge, who had the wrong conclusions from the very beginning.

For example in the case of shale gas, where everyone seems to have all the answers.

We don't even know what shale gas is, what its value is and why it is so important, but we already have conclusions and answers to questions that others are just beginning to ask now.

The talks concerning the shale gas only began recently, due to the remarkable results which some countries have obtained following its exploitation, such as the United States of America.

For now we are in a preliminary phase which involves exploration.

The discussion on this topic should be technical, lead by specialists, which is not what is happening in Romania.

Reporter: The International Energy Agency stated that Romania has shale gas for 100 years, for its own consumption.

Iulian Fota: Indeed, this is one of the major stakes because Romania is still a gas importing country.

If the report released by the agency in question is true, then we can become an independent country, which no longer needs gas imports, or we can become, even more interestingly, a gas exporting country.

And this could change the geopolitical equation of the region, at least from an energy point of view.

Romania has a significant mineral potential - a potential which we can use to our advantage, and to that of our future generations as well.

Reporter: For example, we could exploit Roşia Montană, but charge a higher royalty ...

Iulian Fota: There are certain countries in Europe where the companies had come with a great willingness and interest in their resources, and after a while they left, because at a certain time, due to a populist and demagogic approach, the governments sought to raise their royalties.

Increasing these royalties needs to be done in harmony with the economic national and international situation, because the Government may well run some numbers on paper, and decide to hike the royalty by a certain percentage, but the company in question, which already has some other costs to bear, may not accept a higher royalty and thus it may decide to leave.

I think that this process of hiking taxes needs to be treated with great care and moderation.

The discussion needs to be carried out in such a manner so that you attract businesspeople, not drive them away, because investors are predators, which, in the end, want and need a certain profit.

We need to take great care with foreign investors because they are the ones who lay the foundation of a long term development.

For example, and investment in the energy sector has a cycle of 10 years or more.

And this aspect is extremely important - the moment a company invests in Romania for the next 10 years or more, this also allows the authorities of the state to draw up a development plan.

On the other hand, the departure of a foreign investor sends a very bad signal.

I don't want to imagine the scenario where a major investor on the energy sector will depart Romania - it is a negative signal not just for the energy sector, but for the entire economy.

What is predominant in the coming period, is to attract as many foreign investments as possible because it is thanks to them that we will grow as an economy.

Reporter: Direct foreign investments are still dropping heavily. Furthermore, foreign investors - those we know -are complaining about the difficult dialog with the authorities of the state.

Iulian Fota: This is indeed the first reason.

Second of all, Romania's political stability hasn't been that great, the average lifespan of a Romanian government was less than two years in the last seven to eight years.

The real problem is that in Romania, the change of government destabilizes entire systems. The government changes are also accompanied by the replacement of the employees from top to bottom: sometimes all the way from the directors to the janitors.

Another aspect which we should take into account is that of deprofessionalization. One example in that regard is that of graduates. The best students we have go abroad. Some will return, others won't.

Out of those that stay in the country, the best go to the private sector, which emphasizes competences.

The others, who are less skilled, seek to get hired in the public sector, where it's not the quality of the individual that matters.

Therefore, the state starts absorbing the least qualified people, based on the criterion: my man, my posse, my party.

The perpetuation of this model means that the state is "assassinated" precisely in areas which involve a maximum of exactingness and professionalism.

The deprofessionalization of the central and public administration is becoming more dangerous than the economic crisis.

Reporter: Are we speaking about a future deadlock in society?

Iulian Fota: This will create a split between the educated Romanians who are outside the borders and those living here.

There is already a certain reluctance when it comes to the Romanians who emigrated because they are better prepared, more competent.

When your goal is to do what is best for the country, then you need to have a more competent administrative apparatus. Competence is also a form of loyalty towards the country. The problem is that the current elite in power, built on shaky, wrong foundations, without quality, without criteria for establishing value, will not want to be replaced or to have competition from another elite built on criteria of competence.

Romania's future in the coming years, at least in the coming years, will depend on the ratio between the two elites.

Reporter: What is your take on the amendments being made to the Constitution?

Iulian Fota: In order to improve on the Constitution you need more competence and expertise.

From that point of view, I am beginning to have doubts on whether the future Constitution will be better than the current one, as long as some things are changed just for the sake of change.

Reporter: Is the change of the Constitution necessary?

Iulian Fota: We need a better Romania, and if this involves a better Constitution, then the change is welcome.

Of course, as long as the new Constitution is an improved version.

However, we first need to define what a better Constitution means: simpler, more flexible?

Considering the manner in which the process is currently taking place, I think that the future Constitution will have twice as many pages.

Reporter: Why has the country's National Defense Strategy not been approved after all this time?

Iulian Fota: Procedure wise, the discussions on the National Defense Strategy are still frozen.

The strategy in question has been promoted in June 2010, and in the autumn of that year we had two talks in the Defense Commission of the Parliament, surrounding the text. However, they got stuck when it came to the item concerning press campaigns.

I hope that the Parliament will eventually resume the process and an adequate solution will be found so that the strategy gets adopted as soon as possible. At this moment, the ball is in the court of the Parliament, more specifically at the defense commissions in the Chamber of Deputies and the Senate.

If we take into account the evolution of the international dynamic, then, a few years from now, there may be many things in that document that may change and they may need to be reflected in the defense strategy.

Reporter: it could change completely, if we consider the manner in which the international relations are currently evolving.

Iulian Fota: It's impossible for all the aspects in the international dynamic to change, but there is the possibility for certain things to have already evolved.

On the other hand, there are extremely important documents for our country, such as the White Book of Defense, which can not be discussed in the Parliament without the matter of the National Defense Strategy being clarified first.

Thus the postponement of the process for the adoption of the National Defense Strategy is obstructing other fundamental documents which I know the government has in the works for the near future.

Reporter: We do not have a National Defense Strategy, but the Government recently approved a Cybernetic Security Strategy.

Iulian Fota: Procedure wise, The National Defense Strategy is approved at the level of the Supreme Council of the Board, which, at the time, just like today, contained not just the Presidential Administration, through president Traian Băsescu, but also half of the Romanian government.

In the National Defense Strategy it was stipulated that following its adoption, there would be sectoral strategies.

But the Cybernetic Security Strategy has already been adopted by the Supreme Defense Council, it has been promoted and published, through a Government Decision, so at the present time, we have a first pillar of this new security policy that Romania will have to develop.

In the coming period, the second pillar strategy will be put together and presented - the law of cybersecurity.

Thus, the segment of cybernetic security will be regulated through a law as well.

Reporter: Do we have the funding to implement such a program?

Iulian Fota: The practice of cybersecurity is already ongoing in Romania.

First of all, at least on the national security segment, every institution is already taking steps to prevent and protect its own networks against potential cybernetic attacks.

In the private sector there are also important economic players which are protecting their data and computer networks. The first steps in cybernetic security have already been taken, and at the moment, we only have to organize ourselves better on this segment.

Essentially, based on already existing laws, we are coming with an addition, which is means, in fact, that we are legitimizing the national cybernetic security effort through a law.

Whether or not it will require additional funding, we will see.

In spite of all this, the cybernetic security expenses are very small compared to the potential damages which could occur.

In light of this thing, if cybernetic security will involve an additional expenditure which we can control, I will be the first to support it, because like I've told you, the costs of a cybernetic attack, especially against a critical infrastructure, are huge.

Reporter: What is the current status of the Deveselu missile shield? There are talks about the project being dropped, and also of the US abandoning Eastern Europe...

Iulian Fota: The shield will get made, and we have all the necessary guarantees coming from the United States of America.

The financing is secured and we also have several statements made by American officials which have confirmed this. Therefore the antimissile program of Deveselu is still valid, with all its stages being on schedule.

The American congress has the money approved for the shield and in fact, in the near future there will be several events, including public ones, which will prove this - the project of the antimissile shield continues.

Reporter: So there is no opinion that the Americans will, in a manner of speaking, abandon Europe?

Iulian Fota: This claim has no support, and Americans, in the second term of president Obama, have very clearly explained that for them, this additional support granted to the Pacific will not be done by excluding Europe, but by including it as well.

For example, the first visit of American secretary of state John Kerry, after his appointment at the White House, was to Europe.

Also, even the placement of the antimissile shield in Europe comes to prove that the Americans will not abandon Europe, as the shield is intended to protect the territory of the United States, as well as that of the European allies.

Reporter: What is Romania's position when it comes to Russia?

Iulian Fota: We have been very open and we have struggled hard, over the last few years to improve cooperation and dialog with Russia even in those moments when our viewpoints did not coincide with theirs.

Romania still maintains this openness to dialog.

We are hoping that this year will be a good one, perhaps even the best for bilateral dialogue with Russia, taking into account a series of events which will take place in the near future.

In my opinion, however, in certain regards or in certain moments, Russia treats us a bit unfairly and I think that if it were to look closely at what we are doing when it comes to foreign policy, at our positions, at the manner in which we supported or did not support certain points of view conveyed, they would see that Romania doesn't have a hostile policy towards Russia.

Romania hasn't wanted and does not want a policy of confrontation with Russia, as we are more focused on a policy of cooperation and openness.

The two states also have an economic relationship which is going very well, an aspect which is demonstrated by the recent meeting president Traian Băsescu had with the manager of Lukoil, Vagit Alekperov.

But it is just as true that we want a pragmatic policy, based on mutual respect and equality.

Reporter: A relationship of coordination, not of subordination ...

Iulian Fota: We have nothing to reproach when it comes to the Romania-Russia relationship, we have never intended and we have never wanted to have aggressive actions in our policy.

When Romania has certain initiatives it is promoting, but which are not to their liking, I hope that the Russian party understands that we are not promoting those initiatives starting from the idea of a zero-sum game, but rather we are promoting those initiatives starting from Romania's needs for energy cooperation, including on the energy segment.

The best proof is the fact that Lukoil has leased perimeters on the continental shelf of the Black Sea.

Reporter: But what is the main element of tensions between the two sides? Moldova or the shield of Deveselu?

Iulian Fota: There are elements of Romanian foreign policy which Russia views differently than we do, which is normal, just like we have a different way of looking at certain aspects of the foreign Russian policy.

Of course, this doesn't mean that we can't have a dialogue or to analyze them or consult on them, it doesn't mean that we can't harmonize the two points of view.

Concerning the shield, I have repeatedly said this - the shield is a strictly defensive element for Romania, just like it is a defensive element for the United States as well.

This is also confirmed by the legal agreement with the United States where we have made it clear that the shield of Deveselu will be used exclusively for defensive purposes.

Reporter: What are the main strategic priorities Romania has on a foreign level?

Iulian Fota: The fundamental parameters of our foreign and security policy remain unchanged.

First of all we are a country which is a member of the North Atlantic Pact (NATO) and of the European Union, so that we will continue to fulfill our obligations and commitments we have made once we joined the two organizations.

Second of all, we are continuing the foreign political initiatives, which president Traian Băsescu began over the last few years, to get back the special relationships we used to have with many countries which we have ignored in the past because we were very focused on NATO and the European Union.

As a result, in the last few years, we have focused our attention on developing special relationships with countries in Central Asia, such as Azerbaidjan, Kazakhstan or Turkmenistan.

We have recently had very productive talks with officials from Uzbekistan, and we remain very willing and open to cooperation with other states in Asia such as China, North Korea, Japan.

Reporter: What is currently the greatest risk for Romania?

Iulian Fota: There are several risks to handle, including the one represented by cyber-terrorism.

The phenomenon of cybernetic attacks is relatively new, as it takes time to understand it, the attackers usually have the advantage.

There is also an entire series of risks which I see stemming from the increasing uncertainty of the international system.

For Romania, from an international point of view, the strategic holiday has ended in 2008.

The international system has entered a transition phase: what we knew as the fundamental parameters of the international relations is beginning to change, and everybody feels it.

However, no one can predict what the new configuration of the international system will look like.

Most countries are currently going through a process of internal evaluation and adjustment to the new circumstances, and some of the conclusions of these evaluations could lead to radical changes in their policies.

It is possible that interest in certain regions will grow, or quite the opposite, to significantly fall.

Reporter: Thank you!