Regional Project for Labour Relations and Social Dialogue in South East Europe January 2011 Annual Review 2010 on Labour Relations and Social Dialogue in South East Europe: Romania By * Content Executive summary Socio-economic developments Governmental policies and legislation Industrial relations Tripartite social dialogue Forecasts Annex- Information about: Collective bargaining, social dialogue, social security, education& vocational train­ing, employment, wages Trade unions and employers’ organizations * , Economist © Friedrich-Ebert-Stiftung Regional Project for Labour Relations and Social Dialogue in South East Europe Tadeusa Koscuska 8/5 11000 Belgrade, Serbia E-Mail: fes@fessoe.de Internet: www.fessoe.de The text is available online: www.fessoe.de The views expressed in this publication are not necessarily those of the Friedrich-Ebert­Stiftung or of the organization for which the author works. 1. Executive summary World financial downturn had a highly negative impact on Romania’s economic activity, which decreased much sharper than projected due to a combination of an unfavourable external environment and faster retrenchment of domestic demand. Due to harsh eco­nomic conditions, in 2009, Romania signed a loan agreement with the International Monetary Fund(FMI) for almost EUR 20 bn and in order to respect the conditions, in 2010, the government took highly social austerity measures. These include the cut of 25% of the budgetary wages, VAT increase from 19% to 24% and major lay-offs in the public system. As a reaction, trade unions formed a crisis committee but the govern-