Taking the Lead

Romanian officials recently spoke with U.S. businesses and government officials in an attempt to jump-start technology in the country.

by / June 11, 2001
For centuries, Romania has been a square on the chessboard of Eastern Europe. Players, one after another, have moved to dominate the fertile country.

Nowhere in its history is there an indication the country might emerge as a leader in the development of e-government in Europe. Its recent political past -- nearly 40 years of Communist domination that devastated the economy and suffocated intellectual initiative -- precluded Romania from evolving with the rest of the developed world.

However, when Ion Iliescu assumed presidency of the country in December 2000, he boldly announced his intention to catapult Romania into the Information Age. This was a radical departure from the style of his previous tenure as Romanias president from 1992 to 1996. Nonetheless, Iliescu declared that information technology would be the foundation for modernizing the nations economy in his initial address to parliament. Among his first steps in this direction was to name Dan Nica minister of technology and to establish a select team to head up the national effort.

"This is a new beginning," Nica said during a trip to market the countrys plan to U.S. companies. "For the first time Romania has one team with one leader. This is why we can afford to take strong measures with precise objectives and goals."

Although the repressive regime of Nicolae Ceausescu ended with the 1989 revolution, Romania was unable to establish a solid government based on democratic principles. Today, vestiges from the past continue to echo as the two houses of parliament, the president and the prime minister share power in an uneasy partnership.

"We will transform the Romanian society," Nica promised, "as soon as we can implement the digital economy at all levels for the benefit of citizens."

Looking for Partners

In January, Nica led a mission to the United States where the group met with companies and political leaders. The entourage included experts from the private sector and higher education, a member of parliament and government appointees. While attending an IT-focused conference in Denver, the group sat together to explain the countrys strategy for emerging from its volatile past.

"It is useless to have projects only on paper," Nica said. "This is why we are here. To talk to the U.S. business community ... and let them know we want to start immediately."

Unlike their American e-government counterparts, who generally discuss the topic as a matter of daily discourse, the Romanian delegation spoke with passion about the changes that information technology will bring to their country. It is their collective job to explain why Romania is prime for partnerships and investment. The challenge is great, given the countrys history and the fact that they must make the pitch in English. Most of the delegation has an impressive grasp of the language, but members still must search for words to express the urgency and commitment they feel.

"We are aware that we need political stability," said Dan Popescu, vice president of the Senate. "We need legislation and predictability, less bureaucracy and an end to political corruption." However, in March, parliament passed legislation that echoed its repressive past -- requiring foreign visitors to Romanian homes to be registered with government officials.

The plan for Romanias emergence into the Digital Age is aggressive and based on simple business principles. The technology team is looking for private companies to become partners in the rollout of e-government. In exchange, they are offering a favorable business climate, local support and a ready workforce.

"We have highly educated people," said Gheorghe Zaman, an adviser to the president. "We are not starting from scratch." In addition, Romania has its own burgeoning software industry that government leaders hope will offer partnerships to larger companies from the West.

Paved Road

To pave the road for new investment, Romania has developed incentives. "There is a new law in force, according to which foreign investors are recipients of facilities and exemptions," Zaman explained. "Also, small and medium enterprises are granted special stimuli when they are investing."

Adriana Ticau, who is perhaps exemplary of the countys young IT-educated workforce, is the director general for IT strategy. "In the new Ministry for IT, there is an office that is responsible for investor relationships," she said. "This office will help them to integrate their business in the Romanian economic environment, increase the speed and reduce the bureaucracy."

Projects the country has planned include providing computers and Internet access to schools, developing a "virtual library," and modernizing the communications infrastructure with a "1-1-2" system to respond to emergencies. Nica also intends to implement electronic commerce that will include the use of digital signatures and appropriate security systems. A planned Cyber Center will partner industry with the countrys universities.

The government hopes to fund these and other projects through a combination of 80-percent private investment and 20-percent public money. Officials project that private investments will be repayed within three to five years.

Romanias economic base has been fragmented over time. Once, there was oil, but the reserves are nearly depleted. While exploration for new petroleum sources continues, the industry is not a major contributor to the economy. Leading exports include agricultural products, textiles and minerals. Poverty is widespread with 43 percent of the countrys 23 million people living at or below the poverty line. It is on this canvas of potential that Nica and his team hope to create a portrait of the new Romania.

"If the e-economy develops in Romania, that could mean the elimination of poverty," said Zaman.

The country is not without IT resources, according to Nica. "Romania has a very good telecom infrastructure," he said. "For wireless, there is very good coverage. Lucent and Qualcom built the first 3G [third-generation] network in Europe. They chose Romania because this is an emerging market and they feel comfortable with the new government." Nica added that mobile operators are covering more than 90 percent of the country.

Some American companies already have wired themselves to Romanias future. Oracle, IBM and Cisco were early believers. Cisco has 95 Network Academies and a training center in the country.

According to Jody Westby, a Denver-based consultant hired to advise Iliescus team, conditions in the country are promising for IT development. "Romania is a good fit for U.S. companies because they have incredible intellectual capital, reasonably good infrastructure and wages that are a bargain [compared] to U.S. rates," said Westby. After spending weeks in the country, Westby said she is also impressed with the new governments commitment to action. "They are an emerging market with an IT-industry sector that is already developed, particularly in the software field."

Nica was quick to point out that the country already produces about 5,000 IT graduates each year. The ideal situation would be for those students to find jobs in Romania building the countrys future, instead of immigrating to other countries to find work.

Getting acquainted with the power of information technology will begin early for Romanian students. "Education has a program to introduce computers in 15,000 schools," he said. "We are talking about 100,000 computers." The delegation expects this feat to be accomplished by the end of 2001.

Equipped with an aggressive plan and an ambitious timeline, Romanias new revolution will be planned, peaceful and digital.

"In five years, we will be a country where the penetration and accessibility to information technology and services will be close to what Western Europe has now," Nica declared. "It will be a country where Americans dont see a big difference in technologies when you come for your holidays. It will transform the life of Romanian citizens."