The talks on the formation of a ruling coalition in Romania reached a deadlock on December 19 after the Social Democratic Party (PSD) leader and current Prime Minister Marcel Ciolacu pulled out of the talks, accusing the National Liberal Party (PNL) and reformist Union Save Romania (USR) of making unfair comments about their “moral superiority”. 

The deadlock of the talks among the four democratic parties in Romania, after USR claimed it was left out of the negotiations a day earlier, prompted major concerns among investors as quick formation of an executive is critical for taking key fiscal consolidation action before the end of the year.

Ciolacu said he is ready to support a right-wing cabinet in parliament at least until the presidential elections. In a statement posted on Facebook, Ciolacu criticised the behaviour of coalition partners, without naming a specific party, accusing them of inconsistency and disrespect during negotiations.

Key moments to follow are the December 20 formation of the parliament and December 21 when the term of President Klaus Iohannis ends according to the constitutional interpretation accepted by USR and far-right parties. However, following the cancellation of the presidential elections by the Constitutional Court (CCR), and based on a CCR statement, Iohannis said he would remain in office until his successor is sworn in. The future government is to decide the new dates of the presidential elections.

Romania’s parliament is summoned on December 20 after the December 1 parliamentary elections, which makes the incumbent government headed by Ciolacu an interim executive, with reduced powers.

Ciolacu took the decision to quit coalition talks without broader consultations with his party, meaning that the resumption of talks at least with the PNL and the Democratic Alliance of Hungarians (UDMR) party is still possible. 

USR leader Elena Lasconi, as well as Liberal vice president Ciprian Ciucu – the authors of the harsh comments about the Social Democrats that supposedly annoyed Ciolacu – have since toned down or at least explained their positions. 

At the same time, nationalist parties the Alliance for the Union of Romanians (AUR), SOS Romania and the Party of Young people (POT) said they were ready to form a ruling coalition, but their combined 30% of seats in parliament is visibly insufficient. Together the parties command fewer seats than a potential centre-right alliance of the PNL, USR and the UDMR. The latter alliance of centre-right parties is again unlikely, as UDMR said it would not take part in, but would support in parliament, such a minority construction.

Lasconi reiterated her party’s key requirements that set rather high but justified standards: fiscal clarity, action against those responsible for the political deadlock (after the annulment of the presidential elections) and political stability to be achieved through reforms, namely two-ballot elections of mayors, and a reduction of the number of MPs in line with an already endorsed public referendum.