Romanian opposition MPs challenge new government

Wed Mar 5, 2014 6:47am EST

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* PM Ponta's new alliance has 55 percent majority

* Opposition says new cabinet unconstitutional

* Standoff prolongs political instability

By Radu Marinas

BUCHAREST, March 5 (Reuters) - Romanian Prime Minister Victor Ponta faced a constitutional challenge from the centrist opposition on Wednesday that could very briefly hinder pursuit of IMF-backed reforms but seemed unlikely to scuttle his newly-forged coalition government.

Ponta's Social Democrat-led (PSD) government lost its majority last week with the departure of the Liberal Party. But he forged a new majority, albeit smaller, by pooling forces with the ethnic Hungarian UDMR and winning a confidence vote.

The vote, he argues, renewed his mandate for International Monetary Fund-backed reforms to stimulate growth in the European Union's second-poorest country. Any extended delay would raise fears about Romania's ability to stick to commitments under a 4 billion-euro IMF-led aid deal including restructuring of state companies, in an election year.

"We filed a challenge yesterday evening," Tinel Gheorghe, leader of the opposition Democrat-Liberal group in the lower house, said. "We want a constitutional government. Ponta must resign or he must come up with a new governing programme and take responsibility for it if he is to be legitimate."

A Constitutional Court magistrate, who asked not to be named, told Reuters the court might take up to five days to issue a ruling. It could issue a decision as early as Friday.

The new government cannot function pending the ruling. This could prolong a bout of instability further fed by emerging market jitters on Federal Reserve's tapering of its monetary stimulus scheme and continuing turmoil in neighbouring Ukraine.

"We think these actions will only keep the political scene in limbo for a while," said ING bank economist Mihai Tantaru.

The leftist Ponta shored up his party's support, collecting about 55 percent of seats in parliament after granting some government posts to UDMR and got support from other minorities to back his government.

Ponta had commanded a majority of more than two-thirds until his Liberal allies quit.

High on the agenda for Romania this year is to speed up the sale or restructuring of inefficient state companies, and further cut the fiscal deficit and raise some taxes, as part of its precautionary aid deal with the IMF.

"It's like looking through the crystal ball ... but I do think the government will eventually defeat a court challenge," said political commentator Mircea Marian.

"I see no legal grounds to pursue a challenge."

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