43-years old Grindeanu has been a member of the Social Democrat Party for 20 years and has occupied various positions (Timisoara city deputy mayor in 2008-2012, Member of the Romanian Parliament in 2012-2016) and is now Timis county president).
From December 2014 until October 2015 he was also the minister of Communications (Information Society) in the last PSD-led Government.
He previously worked as an university assistant and as a CEO and deputy CEO in the private environment.
Grindeanu studied Computer Science at the Mathematics School, West University in Timisoara. He also completed a training at the National Information Academy of SRI (Romanian Internal Intelligence Service) and while an MP he was a member of the Committee for the Control of SRI.

Position inside PSD and his role as Prime Minister
Sorin Grindeanu is not a well known figure inside PSD or on the Romania political scene. He is considered a politician from the second echelon without a very strong power base. He was only elected president of PSD branch in Timis county a few days ago.
Liviu Dragnea said Grindeanu will be “a PM for 4 years”, although adding later that he has not given up on the idea of being Prime Minister himself.
Grindeanu was chosen for his good image, not being tainted by any corruption scandal or controversy, but also because at the moment he couldn’t threaten Dragnea’s position as PSD president. His activity will be supervised by a PSD committee led by Dragnea himself. Grindeanu also admitted that he will be “subordinated” to Liviu Dragnea because the latter is his party’s president.
The fact that he was proposed as a PM shows that Liviu Dragnea was left without alternatives.

What’s next?
Now President Klaus Iohannis has to decide if he accepts Grindeanu or not. Most probably he will, as there is no obvious reason to reject him. PSD and ALDE have threatened Iohannis with impeachment although it is something very unlikely to happen.
Grindeanu will then present a Cabinet to the Parliament and will be voted as a Prime Minister for sure.
Dragnea said that we will probably not have the next Government in place until the end of the year because of the very short time left but in the first days of January. That means that important measures like the VAT reduced to 19%, the elimination of the excise duty for fuel and the pole tax (infrastructure or special constructions tax) will remain eliminated and the minimum wage will be kept at 1.250 LEI.
PSD can however reverse those decision in the first part of January.


Elections aftermath: The battle for a new Prime Minister and major developments regarding fiscal measures

The parliamentary elections were held on Sunday 11th of December and the results are still not validated but we already have some very important developments regarding on one side the nomination of a new Prime Minister and on the other the request to delay the implementation of some major decisions from the Fiscal Code, also considering that the wages increases in Education and Health public systems are ruled as being constitutional.
The stakes are high because there is the danger that both the inauguration of the new Government and the adoption of a new state budget by the Parliament could be delayed, as well that the budget deficit will swell considerably.
All these factors are interconnected and the results of the moves for each of them will influence the others, as you can see in the analysis below.
First, the facts:


President Klaus Iohannis said once again that he will not nominate PSD leader Liviu Dragnea as Prime Minister.
The head of state has reiterated his intention not to nominate a person who is convicted as Prime Minister, a direct reference to PSD president Liviu Dragnea after this party won a massive victory in Sunday’s parliamentary election. Iohannis added that it is not just the law that bans convicted people from occupying the position but also it is a matter of principles.
Dragnea has not been officially presented as PSD’s nomination but most of the Social-Democrat leaders have expressed their support for Dragnea to occupy this position. Even Dragnea himself hinted that he want to be Prime Minister but without saying it directly.
A local PSD leader, Ioan Dirzu, threatened President Iohannis with impeachment if he refuses to nominate Dragnea.


PSD refused President Iohannis’ invitation to consultations
Klaus Iohannis invited the parties elected in the new Parliament to consultations on Tuesday, in order to nominate the Prime Minister.
PSD refused to come, saying they were not called according to the Constitution because “PMP and USR are not yet parliamentary parties as the new Parliament has not convened”. ALDE soon followed his example.


Ombudsman intervention: A chance for Liviu Dragnea
Romanian Ombudsman Victor Ciorbea has offered some help to PSD by saying it wants to attack at the Constitutional Court the 2001 law that bans convicted people from becoming Prime Ministers.
Ciorbea said that he analyzes that option after “seeing debates about the issue on televisions”.
If the law is declared unconstitutional, PSD could have a major reason to claim the Prime Minister position for Liviu Dragnea.


PSD wants to keep 20% VAT, tax on special constructions, excise duty on fuel and to increase the minimum wage/The Constitutional Court rules that the huge salary increases are constitutional

In a surprise move, PSD leader Liviu Dragnea asked Prime Minister Dacian Ciolos to adopt an Emergency Ordinance to modify the Fiscal Code in order to postpone the VAT reduction from 20% to 19%, the elimination of the tax on special constructions and the 7 eurocents excise tax for fuel.
Dragnea has given few reasons for this request, saying just that the PSD government will reduce the VAT and eliminate the tax on special constructions starting with 2018, otherwise it will not have such a big impact.
Prime Minister Dacian Ciolos, after an initial hesitation, refused to accept Dragnea’s request, saying that it is PSD’s job to keep its promises.

The Constitutional Court ruled as constitutional that the PSD-ALDE law to increase the salaries of some personnel categories in the Health and Education systems by up to 25% is constitutional
The law was adopted by the PSD-dominated Parliament prior to the electoral campaign but was attacked at the Constitutional Court by the Ciolos Government. Now President Klaus Iohannis can resend it to the Parliament or directly sign it into law.


PSD has to pas two challenges: 1. Iohannis blocks Dragnea’s appointment as Prime Minister 2. It will have major difficulties in constructing the budget for next year.
One determines each other. If the battle for a new Prime Minister will prolong, PSD will not be able to have a Government able to modify the Fiscal Code through an Emergency Ordinance and a new state budget constructed on its own terms as well as other measures meant to prevent budgetary unbalances.
The political situation is further complicated by the fact that the Constitutional Court has ruled that the law to increase salaries in Education and Health systems by up to 25% is constitutional. The next Government has to find resources to cover these “holes” as well as to keep a least a part of the PSD promises made in the electoral campaign.

This is why Dragnea asked Ciolos to adopt an Emergency Ordinance – because he knew that the fight to become a Prime Minister might be long and that the PSD Government might not have time to adopt it on its own in 2016.

It is also a clear sign that PSD will drag the issue of the next Prime Minister for as long as it can to obtain a good deal. This could be the reason why it refused to accept President Iohannis’ invitation to consultations.
First of all, it needs to make sure that it really has over 50% of the parliamentary mandates. The vote has not been yet validated and it is not 100% clear if PSD will reach that score, it seems that it is just below. If not, it will probably try to bring in its camp MPs elected on other party lists so that it will really have over 50% in order to force the interpretation of the Constitution that says that after the parliamentary elections the President gives the Prime Minister mandate after consultation with the party that has over 50% of the mandates. If no party has over 50%, the President will consult all the parliamentary parties.
The second obstacle is the law that bans Liviu Dragnea from becoming Prime Minister because of his 2015 suspended conviction for electoral fraud. The help will probably come from the Romanian Ombudsman, the only one who can attack it at the Constitutional Court in this stage. The procedure will take time as well.
Also, with all these obstacles cleared, President Klaus Iohannis will probably still not nominate Liviu Dragnea as Head of the Executive.
From that point, PSD has two choices: 1. It comes with another proposal for the PM job (Senator Mihai Fifor, Ambassador to the US George Maior, Bucharest mayor Gabriela Firea or another), but with risks for Liviu Dragnea whose power will decrease. 2. Continues the fight by going once again to the Constitutional Court for a decision to force Klaus Iohannis to accept Liviu Dragnea.
That means more time spent.
Meanwhile, the other issue of the last days, the need to modify legislation (especially the Fiscal Code) in order to have a balanced budget for 2017, will also press PSD. It might want the Prime Minister position but it also wants to be able to govern well next year, without economic shocks.
At this point, Ciolos’ refusal to emit the Emergency Ordinance that would have modified the Fiscal Code puts PSD in a delicate position, adding pressure to them to have a government in place as soon as possible, although it comes into conflict with the desire to impose Liviu Dragnea as Prime Minister.
Which one of these imperatives will prevail? It is still hard to know. What we can predict is that the situation will not be resolved very soon. First PSD will wait for the new Parliament to convene, something that could not happen earlier than 19th of December. Then it could have the upper hand in the negotiations as well as, maybe, an eventual decision of the Constitutional Court that would rule that the law that interdicts a convicted person like Dragnea to become PM is unconstitutional.

In conclusion, the political uncertainty will last for a while as PSD will not move until it doesn’t have all the cards in its hands. That will surely translate into political uncertainty as the new Government will take its mandate much later. Political uncertainty will create economic uncertainty, as we will still not know what taxes will the Fiscal Code include for 2017, what will be the level of the minimum wage and when will a new state budget be adopted. These are all open questions and we will have to wait for the answer more than usual.

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