Costin Lianu: Bulgaria and Romania must specialise intelligently in the Danube Strategy

Interview with the Romanian economic and administrative manager about the importance of the Danube Strategy for Romania and Bulgaria, the obstacles in the Romanian-Bulgarian relations and the spheres in which both countries could specialize in a smart way

The Bridge of Friendship, 24 November 2022

Costin Lianu is a Romanian economic and management expert. His research specialises in internationalisation, management, innovation and branding. He is an author of books in these fields and a practitioner in innovation and internationalisation ecosystems. He has held various positions in the Romanian government, academia and business. The Bridge of Friendship blog sought him out in connection with his article “Smart Specialization in the Danube Region, Building Trust through Communities of Practice, his views and experiences on the Danube area and Romanian-Bulgarian relations.

Mr. Lianu, explain more about his ideas on collaboration and interaction in the Danube region between Romania and Bulgaria.

Yes, it is, if we refer to the article, which I wrote earlier, we were and are involved in pursuing this process of collaboration and smart specialization in the Danube macro-region and this process of smart specialization is an important regional process. Within the European Union, less people know about this. In addition to regional development at the level of the national member states of the European Union, there is also macro-regional collaboration between several countries, which form macro-regions. The Danube Strategy and the Danube macro-region is the next major macro-regional project of the European Union, after the Baltic and the Adriatic macro-regional projects. Now there is also a concern for the Carpathian area. So, these macro-regional projects are a strategy of the European Union to add value to the European integration process not only at the national or regional level of the member countries, but also in certain large regions. The Danube is a strong regional identity, as is the Baltic area, because the whole Danube macro-region means the Danube basin, so it is not only the Danube river, but the whole Danube basin and it includes 12 Danube countries. And among the main Danube countries are our countries, Bulgaria and Romania.

So this macro-regional collaboration adds value to the pre-existing bilateral Romanian-Bulgarian collaboration. What I was trying to say in the article, and it is still valid today, is that in this process of intelligent, macro-regional specialisation, it should be thought of as a kind of specialisation at the level of communities of practice, i.e. of clusters, clusters of companies, universities, research institutes that target certain thematic areas. This is a vast process and depends very much on the entrepreneurial discovery of these specialisations. Basically, behind smart specialisations is the assumption of a role of creating new business models by business people, smart specialisation being closely linked to innovation, to innovative capacity. Here again, the great challenge for Bulgaria, Romania and the areas in the lower Danube basin is to find specialisation formulas that speed up innovation in countries with an innovation gap with the countries in the upper Danube basin – Bavaria, Austria, Baden-Württemberg, because not all of Germany is part of the Danube strategy, but only Bavaria and Baden-Württemberg. Romania and Bulgaria are countries with a lower innovative capacity according to official EU statistics. And so I have tried and we will try to stimulate, on the one hand, a transfer of experience on these types of communities of practice from the advanced states of Bavaria, Baden-Württemberg, Austria to our area, but also to find the resources to create our own structures of intelligent specialisation between our countries.

And here I give an example that we can discuss with regard to the Danube basin. We could specialise Bulgaria and Romania in the agro-industrial area, because here we have development capacity, we have resources, we have production factors, we have knowledge, we have people. Also, the energy area, the circular economy area, the use of biomass are other possible areas of intelligent specialisation. The area of river traffic on the Danube takes another form of intelligent specialisation in the area of logistics and so on. So the process is a vast process. In which each of us is trying to develop various specific projects. This is the context.

Theoretically speaking, it sounds good, but how much is the implementation of these ideas satisfactory, when we know that, for example, dredging of the Danube has been a problem for a long time, or even water levels, for example, are low lately, and how much do Bulgarians and Romanians actually cooperate in the EU? Are there not problems in this regard?

Again, when we talk about cooperation between Romania and Bulgaria, of course there is much more potential, but there is. If we look at the exchange statistics, the development of the number of projects that Bulgaria and Romania are carrying out together or in the context of European networks, we see that there is a dynamic. There are common problems concerning the course of the Danube, concerning drought, which are not only in Romania. Unfortunately, they are everywhere, not only in Bulgaria. So we are starting. There have been cross-border collaborations in other areas where Romania and Bulgaria have managed to come up with valuable cross-border projects.

For example?

In the agro-industrial field, I myself have collaborated, I have participated in collaborations in organic agriculture and agro-ecology, in exchanges of knowledge, information and training between Romanian and Bulgarian farmers. There have been forms of support in the green energy sector, of collaboration. I don’t know all of them, but there are many, many forms of collaboration and valuable projects.

We also collaborate in Interreg, that is in Interreg, which is dedicated to the Danube micro-region. There are Romanian and Bulgarian partners who have developed various projects together. Unfortunately, it is not as much as we expected. And the big problem if we talk about the Danube Strategy is that the Danube Strategy, like the other macro strategies, does not have a clear funding, apart from Interreg, they do not have dedicated funds, like the Horizon Europe project or other projects. This strategy is a kind of accumulator of projects and a platform through which you can justify certain projects as having macro-regional relevance.

Yes, you are right, there are not many achievements at the moment, but that does not mean that we should give up on continuing to explore different possibilities for collaboration. We also have links with your representatives in Romania in the area of trade and we have links with universities in Bulgaria. We collaborate on Erasmus projects with universities in Bulgaria that are relevant to the Danube Strategy area, such as the area of artificial intelligence. We also collaborate on digital hubs, we have collaborations with digital hubs in Russia on the theme of collaboration on digital transformation, which is a component not only of the Danube Strategy, but also of all European strategies, the so-called green and digital transition. So I would say that, all in all, we are making progress, not as much as we would like. And there are other challenges related to geopolitics, which have taken up a lot of our time lately, both in Romania and Bulgaria. There is also this institutional component, in which there are these challenges of the short term that occupy the political agenda in Romania and probably in Bulgaria as well, and which often drive political decision-makers away from projects with vision and scope on this strategy.

Personally, I can tell you that we have the Advisory Council of the Danube Strategy to the Romanian Ministry of Foreign Affairs. When I say we, I mean my network of clusters and associative structures and universities. We have regular meetings on the Danube Strategy, we commemorated Danube Day in the summer, but at least at the level of the Romanian authorities, I do not see any constant concern about this strategy at the moment. So there is no concern, there is not much activism in identifying projects. It is put on a secondary agenda, because we have this problem with energy, with rising prices, with the large budgets that we have to cover for other things where the appetite of political decision-makers for this strategy is low.

How great is the potential of the Danube Strategy, in fact, to foster relations in the region?

The strategic potential for the region is very high. This is what I have been aware of over the years, since 2011, when we have been working on different areas and pillars of the Danube Strategy. Especially on the competitiveness pillar. I have noticed that those who invest more, unfortunately, let’s say at state level, through public policies, through administrative capacity on the Danube Strategy, by supporting networks and thematic areas, by organising information conferences for the business environment, by helping companies or associative structures to write valuable projects, are unfortunately not from our area, they are still from Baden-Württemberg, Bavaria, Austria. They support this strategy with their budgets, at least in their countries.

There is no flagship project or two flagship projects in Romania on the Danube Strategy, in which we say “For us, the Danube Strategy aims to combat drought and pollution in the Danube area”. We had a flagship project, a so-called sturgeon flagship project, supporting sturgeons. There are also some other projects related to logistics, which we have also promoted, but we don’t have a project where the Romanian state says “We want to finance these three projects. We, as a state, for their relevance in the Danube Strategy, want to demonstrate that Romania, as a signatory and initiator state in the 90s, has chosen the strategies of the Danube strategy.”

The Romanian state is able to finance a macro-regional strategic project for the interest of all regions, but we do not have any kind of macro-regional institution in the thematic areas at the moment. That is, we do not have, for example, as the Croatians have, or an institute dedicated to entrepreneurship and entrepreneurial education. The Centre for the Study of the Chamber System and Cooperation at the level of Territorial Chambers is in Budapest. The Centre for Competitiveness and Innovation is somewhere in Baden-Württemberg and so on.

So this is what we lack, to be somewhere and this is what we have always advocated, to have a thematic sub-area that we can say “look, the Romanian state is doing this work as a priority for all the programming periods of the Danube Strategy”.

Why not achieve such specialisation in our countries, which still have a role to play in the Danube area?

In my opinion, according to the data I have, the Danube Strategy is not well known, not well communicated, not well supported through communication. Few people know what the Danube Strategy means, what advantages it can offer to universities, the business world, public institutions. The main problem of the apparent lack of interest, or low interest to put it better, is related to the lack of communication. Here, too, national states have an important role to play in creating communication structures and supporting this strategy through activities and conferences. This is a minimum we should do, but we should communicate this as much as possible and finance communication, because if we leave the financing of communication to the communities of practice, to universities, to the business world, we will not achieve what we can achieve. The state has to step in to communicate, because the state has a different capacity to communicate, it’s, let’s say, a communication machine.

As we talk about the state, Romania or the Romanian administration, has an appetite for making positions in the administration or adopting some concepts, such as, for example, with regard to the Danube Strategy, the so-called Danube officers. This tendency can be seen in several other ways too: the application of the so-called functional areas (an IMF-supported design). Or ethics counsellors in the state administration bodies. So there is some administrative innovation in Romania! Can you tell us more about these innovations and their philosophy?

Let me give you an example of institutional incapacity, when I was at the Ministry of Economy, when I was in charge of the Danube Strategy. At that time there was a person in charge of the strategy in the Ministry of Economy, who had the obligation to create the network and to bring in the thematic areas, because almost every month a subcommittee from the priority areas meets. There are 11 priority areas. That’s where the laboratory of the communities of practice is created. That’s where the science is built up, the capacity to write projects, to fund. What you need to do is go to these meetings.

The Romanian state doesn’t have SUERD structures set up in all our ministries to participate in these things, to be fundable, to be budgetable. If you go there, you will see that people from Baden-Württemberg go, people from Bavaria go, people from Croatia go to these meetings in Romania, they often don’t go because they don’t have funding. So, apart from communication, there is no institutional capacity to follow up the Danube Strategy. And then the Danube Strategy will move forward, without certain countries benefiting from this progress.

What happens to this idea of training Danube officers? What do the Danube officers actually mean and how much is this approach being applied?

It was a proposal. The Danube officers come from civil society as a proposal and are referred to by other public authorities, especially at local level. They are supposed to be multipliers of information and “guides”, consultants, mentors to bring the idea of the Danube Strategy closer to local authorities and local communities. So they are a link, they are ambassadors of the ambassadors of the Danube Strategy at local level. The idea was that these Danube officers, at least in part, should have funding in local budgets, at county councils, in our case, so that they can do their job, that you can’t do. We do a lot of things voluntarily, a lot of things out of enthusiasm, but you’re not going to be able to do them all out of enthusiasm at one time like we are in the SUERD Advisory Council. We make meetings, we organise, we allocate resources, we write, we make materials. There are others in the Advisory Council. The business community gets involved, but they don’t get involved pro bono as for. But nobody is funding our activities.

So these officers are more of an intention.

They are rather an intention that has not materialised, to my knowledge, in too many places in Romania. There is no strategic, institutional approach, what do the Danube officers mean and whether the Romanian state can finance them with anything. I have struggled to make this stuff. I also did some courses, because this strategy has a history, it has some stories, people need to understand what it means, how to get funding, that strategy, but they do it more from the people from. When they organize from the upper Danube area, from Bavaria, from Baden-Württemberg, from Austria, they are more involved in such events and they call us, but we, to have an initiative of our own, we don’t have.

You mentioned that there are geopolitical challenges. How do these challenges influence both countries and relations between them?

Geopolitical challenges affect us all. The closer we are to the flashpoint, the more we are affected. The main geopolitical challenge for the whole continent is to be the geopolitical commitments and geopolitical unity of our countries in the adverse context where certain sustainable development agendas can be postponed, such as the Green Strategy, the use of certain energy resources and so on. Here we can see a redefinition of the ambitious agenda that we initially set ourselves on combating climate change, on the green transition and so on. So geopolitics affects all of us in this respect, including the Commission and the Member States. In our case, geopolitics also affects the issues of the limits of the less developed countries, which explain to the citizens. And you know, the debate is probably just as intense in Bulgaria about how we are going to bear the costs of Europe’s energy reorientation following the conflict is a geographical reorientation. Well, all these things, of course, will affect our countries and, of course, also the electorate and the people. But bilaterally I think we are in line, even if there are other kinds of voices in this democratic concert. But I think we have common interests and geopolitically, we feel under the magnifying glass. And as a result of that we are bringing our peoples closer together. That is my perception.

Yes, in this sense do you think that Bulgarians and Romanians will get closer, given that their populations don’t really know each other, maybe people don’t really trust each other and so on. We see Poland and Ukraine, who are doing very well with each other, Turkey and Russia are cooperating somewhat well. How can Bulgaria and Romania develop their relationship in this context? What can they do?

We should have meetings at political level as often as possible. That’s a first. There used to be meetings between governments and they used to set priorities on the Danube bridges, on cooperation on the Danube. So this is on the political agenda so that we can work together on this area of resilience. Because, after all, territorial resilience is important for. Both for Romania and for Bulgaria. When I say territorial resilience, I am talking about combating drought. It is a common theme that we should address as it is cross-border. What the cross-border dimension should be politically primed, as we have in Armenia, and supported by as many meetings as possible between us. Let’s develop joint funding projects on this theme. Let’s link our various national strategies to a Bulgarian-Romanian cross-border interest. From my point of view, what I have relations at the academic level and at the level of environment, business, clusters, communities, practice, relations are excellent. So we have a common affinity, we understand each other very well and I tell you that I frequently go to Bulgaria on various projects and you can see that we want to do together and at our level, there is cooperation and understanding. If we expand these practices, this feeling of trust in each other will definitely grow.

Let’s conclude with this: Who is the change agent with the greatest potential in Romanian-Bulgarian relations? I ask because you seem to rely on the states in some ways, but the states seem to you to move more slowly? And that’s why I’m asking to what extent other protagonists, such as peoples, or NGOs or cultural or other organisations, can be agents of change?

Agents of change are indeed, as you said NGOs, civil society. We have very good links with the Bulgarian-Romanian Friendship Association. I know them, they are and I often go to your office when there are meetings. I support meetings between business people, between associative structures, associations, on various topics. So this is clear. As civil society matures in Romania and in Bulgaria, and as they collaborate, the links between them grow. And I would also mention the role of universities here, in the academic area, the more the process will catalyse and send signals to the policy makers.

Photo: Costin Lianu (source: Costin Lianu)

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