Romania minister vows sound fiscal policy for EU

BRUSSELS, Oct 4 (Reuters) - The man who has the strongest chance of becoming Romania's next prime minister vowed on Monday to bring the country into the European Union in 2007 in good economic shape thanks to prudent fiscal policies.Foreign Minister Mircea Geoana, the ruling Socialists' choice for premier if they win Nov. 28 polls, said approaching EU entry and cheap labour would lure foreign investors en masse to Romania if it keeps a tight financial stance.In an interview with Reuters, he reaffirmed the government's plan to allow foreigners into the local bond and leu deposit markets while confirming that the central bank would start inflation targeting in determining its interest rate policies."Macroeconomic stability is key for investors. We must do all we can to continue the virtuous economic cycle that has started in Romania," said Geoana, a 56-year-old former ambassador to Washington.He added he expected many Western companies to move their plants to Romania, where labour is cheap and relatively well-trained, once the government scores its first big successes in fighting corruption.Geoana and Prime Minister Adrian Nastase came to Brussels to make last-ditch efforts ahead of the publication of a European Commission report on Wednesday which is expected to open the way for Romania to join the EU in 2007.Geoana said his government's priority would be to sustain economic growth at 5-7 percent in the next 3 years. Romania's expansion was at 6.6 percent in the first half of 2004, up from 1.8 percent in 2000.Geoana predicted that inflation should fall to around 2.0 percent year-on-year in 2007 from 12.4 percent in August.His government would seek to keep the budget deficit to around 2.0 percent of gross domestic product in 2007, from a 1.64 percent target this year, although the figure might later grow slightly due to costs of EU accession, such as the co-financing of the bloc's aid.Goeana's ex-communist Social Democrat Party (PSD) is leading public opinion polls with a 44 percent support rate, although one survey showed on Monday that the majority of Romanians, fed up with persistent graft, would welcome a change at the ballot.Prime Minister Adrian Nastase is running for president in the elections and the party has said Geoana would step in his shoes if it wins. The opposition has not named their choice for premier."We need fast economic growth to start catching up with the rest of the EU. We do not want to be just an EU member, we want to be a successful EU member," he said, adding that Spain would be Romania's "role-model" in the bloc.

Final borders of the EU

Olli Rehn of Finland, who has been allocated the enlargement portfolio was asked if EU enlargement was a finite process. Mr Rehn referred to the Treaty establishing a Constitution for Europe, saying that if a European state "has a vocation to become a member of the Union and is committed to European values, i.e. democracy, the rule of law, human rights, the protection of minorities, a functioning market economy, and if it is able to take on the obligations of membership, it should be accepted as a candidate." The eligibility of other countries to become candidates for EU membership, should not be judged on geographical aspects alone, but also on cultural aspects and historical commitments.