BNR's Popa: NRRP billions might be held back due to slothful absorption & implementation rate

  The National Recovery and Resilience Plan (NRRP) is the most ambitious reform and investment initiative Romania has ever had at its disposal, but the absorption and implementation rate is extremely slow, and without reforms or milestones met, the billions will not flow in, argues Cristian Popa, member of the National Bank of Romania's Board of Directors in an op-ed posted on Linkedin."With a total allocation of 28.5 billion euros (13.6 billion euros in grants and 14.9 billion euros in loans), the NRRP should speed up the modernization of infrastructure, the digital transformation of public administration and the improvement of key sectors such as health care and education, with European money. However, Romania is facing major delays. By the end of September 2024, of the total of 28.5 billion euros, our country had collected only 9.4 billion euros, that is, about a third. The problem is that only 4.1 billion euros of this money were actually spent at the end of the third quarter of 2024. In terms of milestones and targets, Romania has fulfilled just 14% of what it had pledged, with 448 milestones out of 518 still unchecked (European Commission data). This means that the pace of absorption and implementation is extremely slow. Without reforms, respectively milestones fulfilled, the billions will not come," Cristian Popa cautions in the article titled "The NRRP Stage: Long Overdue. Yet The Opportunity We Cannot Afford To Miss Is Still There".According to Popa, Romania was the only country at risk of having payment commitments or payments suspended based on Article 10 of the Recovery and Resilience Facility Regulation which sanctions member states that do not correct their excessive deficit."I have said it before: the NRRP is not just about absorbing European funds, but also about the structural modernization of Romania. It is hard to imagine another occasion when someone offers you 28.5 billion euros for development and only asks you to do what was necessary anyway: reforms, fiscal discipline and to invest efficiently, strategically, to do something to help you fare better in the long run. The benefits are twofold: not only do you have a solid source of financing, but you also have a clear set of reforms and implementation mechanisms to back sustainable development. It is, of course, important to receive fishing rods, not fish, to cope even after the program runs to end. We have less than two years left to capitalize on this opportunity. In the end, the unspent amounts are lost. Will we succeed to increase the funding absorption rate?," Cristian Popa inquires in conclusion.