Why is Romania poor?

Romania was one of the largest producers of Oil in WW2.

Romania has a lot of resources such as Gold, Iron and Oil
They have the Black Sea
They have the ability to manufacture cheaper than the rest of the EU

Cristian Vidrascu, keep observer of Romanian culture

Written 19 Oct 2014

Here is the bad:

1) Very high taxes on fuel - which results in artificially high prices on almost every good (since
most are transported by truck).
2) A very large segment of the population is employed by the government, being basically parasites
of the economy instead of producers.
3) Economy-killing regulations imposed by the EU to protect Western producers (Romania was
intended as a consumption market of the EU, not a competitor to politically-connected Western
producers).
4) Poor infrastructure (roads, legal, etc.) causing delays and inefficiency.
5) Poor labor laws - which make it hard to fire people on the spot, lots of payroll taxes, and other
burdens which make companies reluctant to hire people "legally"; as many people work "without
papers", they do not have access to loans to buy cars or houses - and must pay for everything up
front in cash.
6) Communist-era bureaucracy which makes it really tough to be an entrepreneur, and do it legally.
Since most of the economy is forced to operate outside of the legal sphere, there is no legal stability
for real investment.
7) Large regulatory bodies which basically act as corrupt power-brokers - shutting down outside
companies which threaten those of people with ties to the politicians.
8) Demographics (aging population no longer fit for the workforce).

Notice I did not mention corruption - as that is a result (and not a cause) of the large number of
regulations, and the large power the central government has.

Here is the good:

Romania was doing ok economically before the Communist invasion. Before WW2, its economy
was much stronger than Spain's or Portugal's for example (although not quite in the league of
industrial powerhouses such as Czechoslovakia). After Communism, it became one of the poorest
countries in Europe. Now it is rising again, a middle class finally exists, and there are also
positives:

1) Internet connectivity: with a very tech-savvy youth, and one of the fastest internet connections in
the world, it might be a blessing that traditional employment is discouraged by the laws. Thus,
many young people work online with foreign firms and develop skills for the future.
2) Education, despite all hysteria about how it has gone down the drain, is still ok - judging from
how well Romanians emigrants fare in their new countries.
3) National debt: still very low for an EU country, the government lives (almost) within their means
and don't spend much more than they take in.
4) Stable national currency - the government does not debase the national currency for short-term
political gain. Thus inflation has been kept in check for a while, leading to monetary stability (not
sure if to give Romanian politicians credit, or their IMF/World Bank/EU overlords, but who cares,
given the result is positive).
5) Very low crime rate, even for a European country.
6) Romanians perceive Romania as a very poor backward country, because many have the
opportunity to travel abroad, and compare it with Western European capitalist countries. Thus, the
image is much grimmer. They would do better comparing Romania in 2014 with Romania in 1990,
2000, and 2010 to see it has gone a long way toward more stability and prosperity. There are lots of
things to do, but the old generations raised in Communism have to die off, the Nanny State
mentality has to disappear, and things can continue to improve - slowly but surely.
That is, until the next superpower decides to invade :)