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Cablegate: Romania: Subway Strike Gridlocks Bucharest On Eve Of

VZCZCXRO0167
PP RUEHIK
DE RUEHBM #0771 3210925
ZNR UUUUU ZZH
P 170925Z NOV 09
FM AMEMBASSY BUCHAREST
TO RUEHC/SECSTATE WASHDC PRIORITY 0082
INFO RUCNMEM/EU MEMBER STATES COLLECTIVE

UNCLAS BUCHAREST 000771

SENSITIVE

STATE FOR EUR/CE ASCHEIBE

SIPDIS

E.O. 12958: N/A
TAGS: ECON ELAB PGOV IMF RO
SUBJECT: ROMANIA: SUBWAY STRIKE GRIDLOCKS BUCHAREST ON EVE OF
ELECTION

Sensitive But Unclassified; not for Internet distribution.

1. (SBU) Workers in the Bucharest subway system (state-owned
Metrorex) went on strike November 17, forcing the system's 650,000
daily riders to find alternate means of transportation and producing
traffic gridlock in many areas of the city. Metrorex's 4,250
employees are demanding a 20 percent salary increase, on top of the
23 percent raise they received in 2008. Weeks of negotiations with
the Government of Romania (GOR) have failed to produce an agreement,
and the Ministry of Transport has insisted to Metrorex union leaders
that no salary adjustments can be contemplated until a 2010 budget
is approved, likely not until early next year. The union dismisses
this argument, noting that a final Metrorex budget for 2009 has
never been approved, and is vowing to strike indefinitely until its
demands are met.

2. (SBU) Under Romanian law, essential means of public transport
such as the subway must maintain service at one third of usual
levels even during a strike, so Metrorex employees announced that
trains would run only after 4:00 p.m. (i.e., the latter third of a
usual service day). Following the pattern of the last Metro strike
in 2005, however, the Government will likely seek an emergency court
ruling forcing the union to operate trains throughout the day, but
at one third of normal frequency. In either case, hundreds of
thousands of Bucharest residents face the unhappy prospect of
schedule delays, jam-packed trains and buses, and
much-worse-than-usual traffic until the strike is resolved.

3. (SBU) Media commentators have speculated widely about the timing
of the strike less than a week before the November 22 presidential
election, with the possibility of depressed voter turnout (not to
mention sour moods) in the capital if the strike persists through
the weekend. Interim Minister of Transport Radu Berceanu and other
PD-L politicians charge that the strike is politically motivated,
noting that Metro union leader Ion Radoi is a former PSD senator and
that the union has strong affiliation with the Social Democrats.

4. (SBU) The GOR's agreement with the IMF further complicates
matters. In order to bring deficit spending under control, the IMF
is insisting that the Government drastically cut losses by
state-owned enterprises. These include Metrorex, which receives
more than half its annual budget from state subsidies and which in
turn devotes more than half the budget to personnel costs. If the
GOR is serious about meeting the IMF targets in 2010 then many
Metrorex employees will be lucky just to keep their jobs, and
double-digit wage increases will be out of the question.

5. (SBU) Comment: After months of rising tensions between the
Government and unions over impending measures under the IMF
agreement to cut public sector costs, the Metrorex strike is the
first labor action with broad impact on the general populace. Not
only could the strike influence voter sentiment in the capital, but
how the caretaker government resolves the problem has real
implications for future implementation of the IMF accord no matter
who wins the election. As the GOR grapples with this strike, other
public sector unions will be watching very closely. End comment.

GITENSTEIN

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