No Eastern Bloc country marked the end of its communist epoch quite as decisively and brutally as Romania, where dictator Nicolae Ceausescu and his wife Elena were executed by firing squad on Christmas Day in 1989. The president’s death brought hopes of a fresh start, but Romania has been plagued ever since by corruption and revolving-door governments -- despite having joined NATO and the European Union in the interim. The latest round of political turmoil has brought down yet another government and could lead to Romania’s first-ever snap election and a new ruling coalition.

1. What’s the source of the turmoil?

Romanians have been protesting for the past two-and-a-half years against the ruling Social Democratic government. The controversy dates back to 2016, when the party, then led by Liviu Dragnea, won national elections. Dragnea was convicted the same year of trying to fix a referendum and was blocked from becoming prime minister. Instead, he ran the country from behind the scenes, allegedly instructing ministers to undermine an unprecedented anti-corruption drive that had begun to gain traction and to enact laws to shield him from prison as his legal difficulties mounted. Ultimately unsuccessful, his efforts sparked the biggest protests since communism, with crowds swelling to as many as a half-million people across the country. The Dragnea episode soured ties with the EU and drew comparisons to contemporary infringements of the rule of law in Poland and Hungary.

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2. How did Romania get here?

After the end of communism, the Black Sea nation set itself on a path to democracy and a free market economy, but progress has been spotty. Romania has had 15 prime ministers during that time, with only two -- Adrian Nastase and Calin Popescu-Tariceanu -- serving their full four-year terms. Infighting has often toppled governments, including two in 2017. But there has also been a large helping of scandal. A fatal fire at a nightclub in 2015 brought down Premier Victor Ponta after it emerged that local officials had been bribed to look the other way on safety violations. The last three governments have been overshadowed by the legal and political dramas surrounding Dragnea.

3. Have there been periods of stability?

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The times of least upheaval in Romania coincided with its joining the North Atlantic Treaty Organization and the EU, when politicians were focused on common aims. The drive to EU accession, achieved in 2007, was especially beneficial in helping build public institutions and civil society. Still, lingering concerns over graft -- coupled with chaotic fiscal policy -- have kept Romania out of the passport-free Schengen travel area and slowed its adoption of the euro common currency, which now looks unlikely before 2024. The country’s 20 million people haven’t been patient: Despite improving economic conditions, hundreds of thousands have emigrated west, mostly to Spain, Italy and the U.K.

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4. What brought down the government?

Romania has churned through four prime ministers since the pivotal 2016 election. The latest leader was Viorica Dancila, a Social Democrat and the country’s first female premier, who took office in January 2018. After her former party boss Dragnea was convicted of abuse of office and sent to prison in May 2019, Dancila took over as party leader and started to reverse the policies he had pushed his proxies to carry out. The shift was welcomed by the EU. But her government suddenly stumbled in July when she announced plans to run for president in November elections -- a job coveted by the leader of her junior coalition partner, who promptly took his party out of the government, causing Dancila to lose her parliamentary majority.

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5. Where do things go from here?

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Dancila is still fighting for her political survival, despite having lost a confidence motion brought by opponents on Oct. 10. Her main rival in the presidential elections next month, incumbent Klaus Iohannis, has nominated Ludovic Orban, his ally and leader of the opposition Liberal Party, to form a new government and become the next prime minister. Getting parliament’s approval could be an uphill battle for Orban (who is unrelated to the Hungarian prime minister of the same surname) because of political fragmentation and a lack of support from rival factions. If he can’t form a government after two attempts, Romania will likely hold an early election.

6. What else might happen?

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Some opposition parties and even Iohannis have argued for snap elections by January, as much as a year sooner than originally planned. That would be the first early parliamentary vote in Romania’s post-communist history. Polls show the Liberals in the lead, with the center-left Social Democrats and an upstart center-right party vying for second place. A new government, or even a caretaker team installed until the next scheduled elections, could improve Romania’s relationship with the EU and move the country further away from Dragnea’s legacy.

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7. What’s at stake for Romania’s economy?

Despite all the political chaos, Romania has largely prospered in the past three decades, especially in the years before and after the 2008 global financial crisis. Incomes have risen as vibrant technology and auto-making sectors fuel one of the EU’s fastest-growing economies. But generous tax cuts and public-sector pay rises pushed by Dragnea -- aimed at keeping voters onside -- have taken their toll on the budget and curbed domestic and foreign investment.

--With assistance from Andrea Dudik and Andrew Langley.

To contact the reporters on this story: Irina Vilcu in Bucharest at isavu@bloomberg.net;Andra Timu in Bucharest at atimu@bloomberg.net

To contact the editors responsible for this story: Rosalind Mathieson at rmathieson3@bloomberg.net, Andy Reinhardt, Balazs Penz

©2019 Bloomberg L.P.

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