THE CHANGING POLITICS OF LOCAL AND REGIONAL DEVELOPMENT AND GOVERNANCE IN ROMANIA MICHAIL BINIAKOS A thesis submitted in fulfilment of the requirements for the degree of Doctor of Philosophy in Economic Geography (SSCI). Newcastle University School of Geography, Politics and Sociology Centre for Urban and Regional Studies (CURDS) February 2011 Abstract This thesis investigates the extent to which a move from a planned to a market economy has changed the nature and character of local and regional development and government in Romania. In the aftermath of the collapse of the ‘Iron Curtain’, the swift towards a market economy and democracy by the ex-communist countries of Central and Eastern Europe triggered a vast process of change that affected all aspects of social life across different many levels. In spite of the complexity of these changes, and the general realisation that local and regional policies are determined from place to place and overtime according to specific domestic characteristics and political decisions the nature of which will also depend on the time and the place of their execution and implementation, most scholarly analyses remain entrapped within existing theoretical ‘orthodoxies’ and research gaps. In this thesis, various theories in local and regional development, post-Socialist transition and Europeanisation are combined to derive a ‘heterodox’ approach to understanding local and regional development and government in Romania by placing particular emphasis on non- economic factors. The case-study of Neamt County in the North East Region is used to illustrate the empirical evidences of local and regional development policies for the post-Socialist period in Romania. Through a close examination of the context, the procedures and the actors of these policies, this thesis argues that despite the occurrence of systemic change in Romania, local and regional policies present ‘layering’ effects, a ‘change in continuity’ that emphasises more the continuity instead of the changes. The ‘heterodox’ analysis proposed in this thesis challenges the theoretical hegemony and uniform applicability of the New Regionalism that is suggested by the European Union (EU) and adopted by the Romanian Government. The consideration of historical and cultural legacies, alongside the economic environment, challenges both the explanatory power and policy paradigm proposed by the New Regionalism for the Romanian experience. Furthermore, it raises questions regarding the effectiveness and efficiency of the EU’s local and regional policies and underlines the necessity to reconsider and reform several aspects of these polices- in the direction of a rather different orientation that responds better to specific local and regional needs and aspirations. ii For Vasileios and Ioannis iii Acknowledgements I would like to acknowledge and extent my heartfelt gratitude to my wife Eleni and our two sons, Vasileios and Ioannis, not only for their support and belief on my work but also for having the patience of a saint throughout the completion of this study. The research for this thesis was mainly supported by a scholarship from the Greek Scholarship Foundation (Ίδρυµα Κρατικών Υποτροφιών - ΙΚΥ). In addition, the ‘New Economic Geography Reading Group’ from CURDS has significantly supported the completion of this thesis. The author would like also to thank the supervisory team, Pr. J.Tomaney, Pr. A.Pike and Pr. A.Stenning, not only for their constructive advice and criticism but also for their emotional support and encouragement through out this study. My thanks go to the study participants for spending time to discuss their experiences and opinions regarding the local and regional politics in Neamt County in Romania. In particular, I thank Mr. Nikolaos Bitcu and Ms. Smaragda Diamanti, the president and vice-president of the Greek Community in Piatra Neamt, not only for participating in my research but also for providing interpretation services in several other interviews during my field trip. I’m also indebted to Pr. Palne Kovacs for her insights regarding the regional administration changes across the Central and Eastern Europe. Last but not least, in writing this thesis, I benefited also from discussions with colleagues and academic staff from the CURDS and the Geography Department in Newcastle University. iv Table of Contents Abstract ii Acknowledgements iv Table of Contents v List of Tables viii List of Figures ix Chapter 1. Introduction 11 1.1 Overview 11 1.2 Studying the Local in Romania 16 1.3 Aims and Objectives of the Study 20 1.4 Structure of the Thesis 22 Chapter 2. Analytical Framework 25 2.1 Overview 25 2.2 Methodological Approach 26 2.3 Working in the Field 31 2.4 Making Sense of the Data 37 2.5 Summary 43 Chapter 3. Theoretical Perspectives on Romanian 44 Local and Regional Development and Government 3.1 Introduction 44 3.2 The Region Problematic 46 3.2.1 Scale Matters 46 3.2.2 Territory and Regions 48 3.2.3 Region Building 51 3.3 The Regionalism Problematic 52 3.3.1 Regionalism ‘old’ and ‘now’ 52 3.3.2 Regionalism and Regionalisation 55 3.4 The Romanian Problematic 56 3.5 Summary 61 Chapter 4. Local and Regional Development in 64 post-1989 CEE: New Forces on Power 4.1 Introduction 64 4.2 The Transition Process 65 4.2.1 Overview 65 4.2.2 Theorising Transition 68 4.2.3 Transition and the Balkan Legacy 74 4.2.4 Transition and the Local/Regional Impacts 78 4.3 The Process of Europeanisation 82 4.3.1 Overview 82 v 4.3.2 Conceptualising Europeanisation 85 4.3.3 Europeanisation in Practice 87 4.3.4 Europeanisation and Local/Regional Politics 92 4.4 Summary 96 Chapter 5. The National Legacies in Romania 98 5.1 Introduction 98 5.2 The Romanian State: a Historical Review 99 5.2.1 Overview 99 5.2.2 From Early Times to Middle Ages 100 5.2.3 From Despotism to National Revival 103 5.2.4 From Old Kingdom to Greater Romania 105 5.3 Communist in Power: Romania from 1945 to 1989 109 5.3.1 Overview 109 5.3.2 Industrialisation 111 5.3.3 Agriculture and Land Reform 114 5.3.4 Economy in Trouble 115 5.4 Aspects of Local and Regional Policies During Communism 119 5.4.1 Overview 119 5.4.2 Planificare 122 5.4.3 Sistematizare 126 5.4.4 Local Participation 129 5.4.5 The Volatile Local/Regional Map 134 5.5 Summary 137 Chapter 6. Neamt under Change 139 6.1 Introduction 139 6.2 The Foundation of the ‘Moldavian Pearl’ 140 6.2.1 Overview 140 6.2.2 Earlier History (until 17 th century) 141 6.2.3 Modern Times (18 th -20 th century) 144 6.3 The Communist Experience of Planning in Neamt 149 6.3.1 Overview 149 6.3.2 Development of Neamt during Gheorgiou-Dej (1947-1965) 151 6.3.3 The Ceausescu Era (1965-1989) 161 6.4 Summary 169 Chapter 7. The Transition Period (1989-1997) 171 7.1 Introduction 171 7.2 Transition and Local Development 173 7.2.1 The Systemic Change in Romania 173 7.2.2 Economic Difficulties During Transition 178 7.2.3 In What Sense a Neamt’s Local Development Problem? 183 7.3 Neamt’s Development Policies 188 7.3.1 Responses from Below 188 7.3.2 Responses from Above 195 7.4 Neamt’s Local Government Practices 196 vi 7.4.1 The Rescaling of the Decision-Making System 196 7.4.2 Transformation of Local Government 198 7.5 Summary 203 Chapter 8. The Pre-Accession Period (1997-2007) 206 8.1 Introduction 206 8.2 The EU Accession as the Solution to Development Problems 207 8.3 Institutional Change: Region on the Forefront 211 8.3.1 Overview 211 8.3.2 Region and Regionalism in Romania 213 8.3.3 The North-East Development Region (NEDR) 221 8.4 New Governmental Processes 227 8.4.1 Overview 227 8.4.2 Legislation for Partnership in Romania 231 8.4.3 Partnership in Practice in the NEDR 233 8.5 The Context of Local Development in Neamt 244 8.5.1 Overview 244 8.5.2 Development Strategies at the Local Level 245 8.5.3 Development Strategies at the Regional Level (2000-2006) 249 8.5.4 The Regional Operational Programme (ROP) 2007-2013 260 8.6 The Key Actors and their System of Relationships 268 8.6.1 Overview 268 8.6.2 Conducting the Social Network Analysis (SNA) 270 8.6.3 The Neamt’s Network Dynamics – a Macro Perspective 274 8.6.4 The Neamt’s Actors – a Micro Perspective 285 8.7 Summary 291 Chapter 9. Conclusions 293 9.1 Introduction 293 9.2 The Changing Politics of Local and Regional Development 296 and Government in Romania 9.3 Theoretical and Conceptual Reflections 302 9.4 Limitations to Present Study and Future Work 305 9.5 Final Remarks 307 Appendices 310 A North East Development Region and Neamt County Profiles 310 B List of the interviewees 312 C The Interview Schedule 314 References 319 vii List of Tables Table 2.1 The analytical framework for the ‘heterodox’ agenda 28 Table 5.1 Labour Force by Sector 1950-1981 114 Table 5.2 Investment by Sector in Romania (1951-1980) 116 Table 5.3 Planned and Achieved Growth 1971-1983 in Romania 117 Table 6.1 Allocation of Industries and other significant companies in Piatra Neamt 154 according to their specialisation in 1944 Table 6.2 Evidence from the ‘golden years of prosperity’ in Neamt 168 Table 7.1 External Trade of Romania in 1995 179 Table 7.2 Money Supply in post-communist countries (1990-1996) 180 Table 7.3 FDI in post-communist countries (1992) 182 Table 7.4 Decline of jobs in Industry and simultaneously increase of jobs 187 in the Service sector (1992-2002) Table 8.1 Structure of the North East R.S.