Romania’s eight development regions are each composed of vastly different economies, demographics and industrial structures. In 2021, gross domestic product (GDP) per capita in the Bucharest-Ilfov region was EUR 28 300, more than double the national average of EUR 12 600 and over 3 times larger than the least-performing region (North-East), with a GDP per capita of EUR 8 300. The majority of Romanian regions also lag behind OECD averages, with lower GDP per capita and labour productivity, and the European Commission’s Regional Innovation Scoreboard classified all eight regions as “emerging innovators” – the lowest performing category of the Scoreboard – in 2023. In addition, Romania’s population has been shrinking since 2012, by around -0.6% per annum, and by more in the southern and western parts of the country. Only Bucharest-Ilfov has managed to avoid population loss in the last decade.
Romania’s counties and municipalities – the two tiers of subnational government – are critical investors in their regions’ development. In 2020, subnational government investment represented over half of the total public investment in Romania and 2.5% of its GDP, in line with the OECD average (54.6% and 1.9% respectively). However, many of them, especially small towns and communes (municipal level), have limited capacity to manage and implement public investment. Romanian municipalities are relatively small, averaging fewer than 7 000 inhabitants, and county councils are responsible for the overall co-ordination of their constituent local councils. The large number of municipalities in each county (over 75 municipalities per county on average) also places significant capacity demands on the counties. Stronger co-ordination among these subnational government units at the regional level could help address capacity gaps and optimise investment outcomes to advance regional development goals.
Romania’s eight Regional Development Agencies (RDAs) are non-governmental, non-profit organisations accountable to their region’s Regional Development Council, on which representatives from the relevant county and local councils sit. The RDAs are professional, well-established institutions respected by leaders and stakeholders, and with excellent knowledge of their respective regions. Among their diverse responsibilities are drafting regional development plans and smart specialisation strategies (S3), supporting innovation actors to design and implement innovation initiatives, and fostering partnerships among regional and local actors. For the 2021-27 EU programming period, the RDAs have taken on the role of Managing Authorities for European Union Cohesion Policy Regional Programmes. Each RDA will be responsible for managing over EUR 1 billion to advance development in its region and design investment programmes that are specifically tailored to its development needs.
