Romanian finance minister sacked in reshuffle

BUCHAREST (Reuters) - Romanian Finance Minister Ionut Popescu and four other cabinet members were sacked on Monday in a reshuffle aimed at boosting popular support for the ruling centrists as they tackle tough EU-prescribed reforms.

Prime Minister Calin Tariceanu said Popescu -- accused by foreign diplomats of not being up to the job -- would be replaced be finance ministry adviser Sebastian Vladescu.

"We need ministers who will perform superbly, not just well," he said.
Commentators said the reshuffle was part of efforts by the centrist coalition to win backing for urgent but difficult reforms in the next few months. Romania must speed up its efforts or risk seeing accession delayed by a year to 2008.

Tariceanu resigned in July to trigger snap polls after the constitutional court watered down justice laws crucial to EU entry, but decided to stay when Brussels told him Romania had no time to waste. A cabinet reshuffle had been expected since then.

Popescu, 40, who was also the country's chief negotiator with the International Monetary Fund (IMF), had been slammed by senior party members for plans to raise value added tax to 22 percent from 19 percent as of 2006.

VAT CHALLENGE
Vladescu, who was deputy finance minister during the 1996-2000 centrist rule which brought Romania to the brink of economic collapse, is a Liberal Party member and government representative on the board of leading oil firm Petrom.

"The government is trying to improve its image but I am not sure firing the finance minister is the best idea. If the VAT needs to be raised, the next minister will also have to do it," said Sorin Ionita, analyst with the Romanian Academic Society think tank.

The government has promised the IMF it will boost revenues to offset losses to the budget from introducing a flat 16 percent income and profit tax after coming to power in January. Previously income was taxed on an 18-40 percent scale and profit tax was 25 percent.

Popescu angered party colleagues by announcing the unpopular VAT rise -- likely to hit poor pensioners in mid-winter -- without clearing it first with his partners in the four-party government led by the Democrats and Liberals.

Tariceanu said former Transport Minister Anca Boagiu would become EU integration minister, replacing Ene Dinga, whom EU diplomats have criticised for a lack of communication skills.
Eugen Nicolaescu, a senior Liberal Party MP, becomes health minister in place of Mircea Cinteza, who failed to improve the crumbling national healthcare system.

Deputy Prime Minister Gheorghe Seculici was replaced by Democrat Party member Gheorghe Pogea, and Tariceanu named Adrian Iorgulescu, a musician, as culture minister, a post that had been empty since Mona Musca resigned in July.

source