| Summary: | The amelioration of the local government efficiency in Romania as prerequisite of economy’s sustainable growth largely depends on increasing exports and improving the business environment at regional and local level, factors that can help reducing the development gap. For Romania, several policies and instruments to improve local governance are proposed, firstly by increasing the absorption capacity of structural funds, which could lead to develop business and exports, implicitly to alleviate regional disparities. Nevertheless, on short and medium term, given the under-size of funds (both from the EU and national sources) major changes in improving the local government efficiency are not foreseeable and, under the circumstances of international imbalances (turbulences on financial markets, uncertainties in crude oil prices), which could adversely affect the Romanian economy, attaining the objective of reducing development disparities may be jeopardized in the long run.
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