ROMANIA: A SITUATION REPORT

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85T00287R000100910002-1
• Release Decision: RIPPUB
• Original Classification: C
• Document Page Count: 7
• Document Creation Date: December 22, 2016
• Document Release Date: June 10, 2010
• Sequence Number: 2
• Publication Date: April 7, 1980
• Content Type: MEMO

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00910002-1
CENTRAL INTELLIGENCE AGENCY
NATIONAL FOREIGN ASSESSMENT CENTER
7 April 1980
MEMORANDUM
ROMANIA: A SITUATION REPORT
Summary
Romania, as it has developed under the direction
of state and Communist Party chief NicoZae Ceausescu,
has become an anomaly among Communist countries. It
combines such "orthodox" attributes as fuZZ.membership
in the Soviet alliance system, party domination of
domestic political life and a highly centralized
economy, with a freewheeling and relatively independent
foreign policy and a one-man dictatorship that in its
personalization and concentration of power harks back
to Romania's pre-war, monarchical past. There are
signs that Ceausescu's authoritarian and austere
domestic policies are wearing thin with the Romanian
- 3 public and that his independent-minded foreign policies
are in danger of becoming hostage to Romania's mounting
economic problems. Ceausescu has thus far managed to
keep his programs intact despite external and internal
4 pressures by dint of his remarkable ability to gauge
7 both the limits of Soviet tolerance and the extent-to
which his people will bear privations. His political
and diplomatic skills will increasingly be put to the
test as Romania enters the 1980s.
PA M 80-101661
USSR-EE/EE Branch/OPA,
This memorandum was requested by the Department of Commerce.
It was prepared by the Office of Political
Analysis. It was coordinated within the Office of Political 25X1
Analysis and with the Office of Economic Research. Comments
and questions are welcome and may be addressed to Chief,
F_ I
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Foreign Policies
Ceausescu's principal foreign policy objective is to
achieve as much independence from Moscow as possible, given
Romania's geopolitical realities. The basic strategies
employed by Bucharest. in pursuit of that goal are to resist
those Soviet policies that promote dominance over Romania,
while avoiding any action so antagonistic to Moscow as to
provoke retaliation, and to cultivate relations with as many
non-Communist countries and independent-minded Communist
parties as possible to.counter Soviet pressure. By taking
this course, Romania has succeeded in gradually extending
the limits of acceptable autonomous activity, but it has
also come into conflict with Soviet policy preferences.
I)~j Romanian-Soviet relations, as a result, have come.under some
strain, particularly during the past two years.
Since Romania's leaders proclaimed their country's
foreign policy independence in the early 1960s, one of their
major preoccupations has been to ward off Soviet pressure
for further integration into the Warsaw Pact and the Council
for Mutual Economic Assistance (CEMA). Ceausescu has often
stated that military blocs are an anachronism and has
actively campaigned for the simultaneous dissolution of both
NATO and the Warsaw Pact. Romania has not participated in
joint Pact exercises with combat troops since 1962 and does
not allow such exercises on Romanian soil. Romanian resis-
tance to greater military integration within the Pact
reached its high point in November 1978 at a meeting of the
Pact's Political Consultative Committee in Moscow, where
! !~ Ceausescu opposed Soviet attempts to force an increase in
J > the defense budgets of member states and to centralize
control over.Pact military forces. Bucharest has subse-
quently assumed a more accommodating stance toward Moscow on
military issues, but has not retreated significantly from
the stands it took at Moscow.
Romanian opposition to economic integration within CEMA
is also long-standing. Indeed, it was the primary issue over
which Romania first broke with the Soviets. Last summer,. at
a major CEMA conference in Moscow, Romania fought--with only
limited success--Soviet attempts to give the organization
7 supranational powers in the areas of decisionmaking and con-
ducting negotiations with international organizations.
Bucharest further distanced itself from its CEMA partners
this year by concluding a major trade pact with the EC--in
direct defiance of the Soviet preference for a multilateral
9 approach toward relations with the EC.
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The Romanians have also clashed with the Soviets on a
variety of international issues they consider threatening to
their foreign policy autonomy, including the Vietnamese
invasion of Kampuchea and the Soviet intervention in Afghan-
istan. Bucharest's opposition to the Vietnamese takeover in
I>7 Kampuchea derives at least in part from Romania's close
relations with China--the ousted Pol Pot regime's principal
ally. Bucharest has opposed the Soviet move into Afghanistan
because of the obvious implications this latest. demonstra-
0 tion of Moscow's willingness to intervene in a friendly or
>1 allied regime holds for Romania. The Romanians. also fear
the resultant deterioration in East-West relations will be
detrimental to Romania's interests. Ceausescu, who ad-
vocates a negotiated solution to the crisis, is apparently
coming under pressure to fall into line with the Soviets on
this issue.
Romania is highly vulnerable to a variety of Soviet
pressures, including economic pressure. The USSR supplies
about a third of Romania's total consumption of iron ore
and, along with Poland and Czechoslovakia, about half its
coking coal. As a result of Romania's worsening energy
crisis and hard currency shortage, the potential for Soviet
leverage has probably grown. Moscow has agreed to sell
2?- Romania a.small amount of crude oil for hard currency--
approximately one million tons--in 1980 and may be dangling
offers of increased future deliveries before the Romanians.
We have no evidence to date, however, that Moscow has made a
concerted effort to apply the economic levers at its com-
mand.
Romania's growing dependence on foreign oil--it now
imports about half its crude oil needs--may be forcing a
change in Bucharest's Middle East policy. Ceausescu has
traditionally pursued an "even-handed" approach toward the
major disputants in the region. Through his efforts to
mediate their differences he has earned a reputation as an
effective behind-the-scenes arbitrator of international
' disputes--a role he clearly relishes. Ceausescu helped
arrange the historic Sadat-Begin meeting in 1977. and is now
seeking to bridge differences between Egypt and the other
Arab states. There are signs, however, that Romania may be
tilting slightly-at least in its rhetoric-toward the more
militant forces in the region, possibly out of concern to
retain access.to Middle Eastern oil.
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Bucharest has actively courted Third World countries in
order to gain political and economic support for.its inde-
pendent policies. Romania is particularly interested in
playing a role in the Nonaligned Movement--with which it
now has guest status--but is unlikely to increase its in-
fluence substantially as long as it is a member of the
Warsaw Pact.
Ceausescu has also sought closer relations with the
West to buttress Romania's*defense against Soviet domina-
tion. He clearly believes that the "special relationship"
he has sought to develop with Washington is especially
valuable--both politically and economically--in this effort.
Economic cooperation protocols signed in March with the
Occidental Petroleum Corporation illustrate the benefits
Romania hopes to derive from this relationship.
Domestic Policies
Ceausescu's independent and nationalistic foreign
policies strike a responsive chord at home, where anti-
Russian feeling runs high. Indeed, domestic political
considerations have probably been a major motivating factor
in many of Ceausescu's anti-Soviet actions. Ceausescu's
domestic policies of rapid industrialization and authori-
tarian internal controls, however, have been decidedly
unpopular.
As a result of the regime's emphasis over the past
decade on capital accumulation and investment, the standard
of living has remained the lowest among Warsaw Pact states
while the economy's growth rates are the highest. As
domestic reserves of.energy and other key raw materials have
become depleted, however, even the rate of economic growth
has begun to falter.
In the face of mounting economic difficulties, the
regime has initiated a number of belt-tightening measures.
Prices have been increased over the past two years for
energy and various consumer goods and an energy conservation
program has been implemented that sharply limits public
consumption.
Ceausescu has sought to improve economic performance by
launching a program to reform economic management. The
program seeks to spur productivity by tying workers' sala-
ries and bonuses more,, closely to enterprise profits and to
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increase production efficiency by phasing out success
indicators that reward managers for lavish material ex-
penditures. Ceausescu is also trying to mobilize public
support for his economic programs by creating an aura of
mass involvement in the political process. These strategies
are flawed, however, by Ceausescu's reluctance to yield
essential control over economic and political decision-
making.
Public reaction to these measures so far has been
restrained, but the regime is undoubtedly concerned that
consumer discontent could erupt and touch off disturbances
in other troubled sectors of Romanian society. Workers have
shown some restiveness, essentially over bread and butter
issues. A.widespread slowdown by disgruntled coal miners
occurred in the summer of 1977, and sporadic incidents of
industrial unrest have come to light since then. Tensions
between the Romanians and their large Hungarian minority
have boiled over occasionally, though the Magyars seem quiet
at the moment. Small dissidence movements have also emerged
among Romanian intellectuals And certain religious. groups in
recent years, but have not posed a significant problem for
the regime. The chances of general disturbances seem
remote, but the regime has betrayed its nervousness by the
quickness with which it has moved during the past year to
squelch the smallest manifestations of dissent.
Ceausescu's dominance of the Romanian political scene,
which was reaffirmed last November at the 12th Congress of
the Romanian Communist Party, has been demonstrated during
g 1 the past year by the extensive personnel changes he has
~) ) overseen on both the national and local levels, under the
rubric of "cadre rotations." In the latest round--in late
March--the most prominent winner was his wife, Elena, who
was elevated to the post of First Deputy Prime Minister. A
member of the party's prestigious Permanent Bureau, Mrs.
Ceausescu is thought by some to be the most powerful poli-
tical figure in Romania after her. husband.
Through periodic cadre rotations--which keep party and
government functionaries off balance and under control--and
manipulation of the bureaucratic structure, Ceausescu has
1)'It4 amassed enormous power. He now rules the country through a
small group of loyal lieutenants and appears able to bypass
the regime's traditional power centers.
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Ceausescu's autocratic ruling style and the personality
cult that enshrines him and his wife appear to have provoked
some resentment within the bureaucracy, possibly reflected
in the stinging attack leveled against him by an aged party
veteran at the party congress in November., There is no
evidence, however, of any organized opposition to Ceausescu
or of any serious disagreement--within the apparatus--to the
basic thrust of his policies.
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