EU Suspends $1.1 Billion in Romania Funding Over Corruption Complaints

The European Union has suspended €1 billion (US$ 1.13 billion) in funding to Romanian projects, according to an announcement made by Prime Minister Victor Ponta on Thursday.

Prime Minister Victor PontaPrime Minister Victor PontaPonta said the suspension was due to complaints about corruption in public works projects, according to the Associated Press.

When a complaint is made about a project, an investigation is launched, and funding cannot longer be drawn from the EU until the case is completed.

Ponta said that if by Dec. 31 officials had not resolved probes into the affected projects, which relate to water supply and public transportation, funding would need to be sourced within the state budget instead.

The Romanian government is notoriously beleaguered by corruption. Former tourism minister Elena Udrea has faced several graft-related allegations this year alone.

In March, two accused officials resigned within a week of each other. They were anti-corruption chief Horia Georgescu and finance minister Darius Valcov.

However, the Romanian Anti-Corruption Directorate (DNA) has increased its efforts to combat graft under chief prosecutor Laura Codruta Kovesi.

According to a 2014 report by DNA, there were 317 indictments relating to corruption in 2014 – double the figure from 2013. More than 9,100 cases throughout the year were managed by 86 prosecutors, said the DNA.

Along with the suspension of project funding, the European Commission recently warned that Ponta’s planned tax cuts, starting from this June and stretching until 2019, could negatively impact the Romanian economy.