Romanians started boycott against Austrian companies

Politics - December 21, 2022

Romanians’ disappointment with Austria’s no vote on Schengen accession has turned into action: a boycott against Austrian companies in Romania, supported by politicians, business and sports people, as well as ordinary citizens. 

In the days following the JHA Council vote, calls for a boycott, pictures of bank cards being cut up and promises that Austrian ski resorts would not have any Romanian customers this year circulated on social media. Moreover, the president of the ruling PSD party suggested that Romania could apply the same treatment to Austria and oppose Vienna taking over the OSCE chairmanship next year. At the same time, in neighbouring Bulgaria, with which Romania is being treated as a “package deal” on the Schengen issue, part of the population, fed up with being treated as “second class” in Europe, is calling for the formation of a “Little Schengen”, which would include Romania and Turkey.

Romanians boycott. Nehamer warns it will backfire

On the very day of the JHA Council vote (8th of December) in which Romania and Bulgaria were not accepted into Schengen, unlike Croatia, Romanian MEP Rareș Bogdan called on Romanian companies to close their accounts with Austrian banks Raiffeisen and Erste-BCR. The two banks reacted to this call and issued press releases yesterday stating that they do not support the Austrian government’s decision. 

“We are surprised by this decision,” Raiffeisen representatives said. 

For its part, Erste-BCR said that “its aim is that all citizens should benefit equally from the freedoms of the Union, including participation in the Schengen area”. 

Local politicians also supported the need to boycott Austrian companies. Local Romanian media reported that Bistrița County Council President Radu Moldovan called on Romanians to boycott Austria altogether, “by discontinuing any kind of collaboration with Austrian companies. Banking companies, firms, petrol stations, tourist services and locations etc”.  He also talked about the fact that the mayor of Călinești-Oaș, Satu-Mare county, has asked employees to give up their Raiffeisen bank accounts and OMV fuel supplies.

One of Romania’s largest sausage producers terminates contracts with Austrian firms

Another protest was that of Voicu Vușcan, the administrator of a sausage company in Alba-Iulia, one of the largest producers in Romania.  He wrote on his Facebook page that he is no longer extending contracts with Austrian firms. 

“I am not at all against multinationals. I speak as a Romanian, as a professional, as a business administrator. The company I run is also a multinational, it is owned by Americans, we have over 2,000 employees here. But it is also not right to be servile and accept the whims of the Austrian government. 

“A fad is what they’re doing now. If not every Romanian, but at least 10% of us will make a small boycott, you should know that when you lose 10% of your turnover you don’t know where to take your shirt off”, says Voicu Vușcan. 

He wrote on Facebook that “he won’t miss Vienna, skiing in Austria, OMV Petrom, Omniasig, Raiffeisen, BCR, Pfanner, Atomic, Fischer, Frey Wille, Julius Meinl, Humanic, Red Bull, Swarovski”. At the same time, one of the most important farmers in the country, Dimitrie Muscă from Arad, announced that he has ordered the closure of all his company accounts with Austrian banks. Reactions also came from the world of sport. Football club Universitatea Craiova announced a “total boycott” of Austrian partner companies. As a result, it will move its accounts away from Raiffeisen and will no longer supply from OMV Petrom. At the same time, a Romanian university in the centre of the country, the Rector of Transilvania University Brasov (UniTBv), has closed its accounts with Austrian banks in Romania, and has decided that the cars belonging to it will only fill up with fuel from petrol stations belonging to companies with the lowest percentage of Austrian capital. The management of the higher education institution has also decided to purchase air transport services for the university’s employees and students from airlines other than Austrian ones, as there are other options in line with the legislation in force.

Romanian state-owned companies have also taken similar measures. Transport Minister Sorin Grindeanu announced that several companies under the coordination of the Transport Ministry are moving their accounts from BCR to CEC Bank.

 “They have found better conditions”, Grindeanu “explained”.

“CNAIR announced a certain intention (to move their accounts from BCR to CEC), and I know they will do it, they told me too. Not only CNAIR, but I was told that other companies under the coordination of the Ministry of Transport, whether we are talking about the Port of Constanța, Bucharest Airport and all the others, because they found better conditions at CEC. It’s a very simple explanation”, said Sorin Grindeanu.

In response, Austrian Chancellor Karl Nehammer, in an interview with ORF, spoke about the calls from Romania to boycott Austrian-owned companies and argued that this would rather harm Romanians. In the interview, quoted by Hotnews, Nehammer said he was “convinced” that his government’s veto in the JHA Council on the 8th of December against Bulgaria and Romania joining Schengen would not have negative consequences for Austrian companies in the two countries.  The Austrian Chancellor argues that a possible boycott of Austrian companies in Romania “would be more damaging to that country” than to Austria, as they bring money into the country and provide jobs.

While Austria does not want Romania in Schengen, under the pretext of migration, Austrian investment has been steadily increasing in recent years. Before the pandemic, Austria was the second largest foreign investor in Romania in terms of investment volume, and this is despite the fact that in recent decades, more precisely since Romania’s accession to the EU, this volume has increased 20-fold. 

Austrian companies invested €12bn in Romania by 2022

According to data reported by the NBR at the beginning of the year, Austrian firms had investments of more than €12bn in Romania. An important thing to mention is that Austria has investments in Romania in key areas – from the financial-banking system, to timber, and oil and gas, including the Black Sea. 

For example, Petrom, a former Romanian state-owned company privatised in 2004, is 51.1% owned by OMV, the Austrian state-owned company. Petrom is the most profitable company in Romania and the Romanian state holds 20.6% of the shares. Petrom produces all of Romania’s crude oil and half of its gas. Petrom’s profits increased fivefold in the first nine months of the year, from 1.6 to 9.1 billion lei.  BCR, owned by Austrian group Erste since 2006, is Romania’s second-largest bank by assets, according to Ziarul Financiar, and Raiffeisen – formerly Romania’s Agricultural Bank until 2001 – is Romania’s fifth-largest bank by assets. 

A political leader suggests Romania should prevent Austria from taking over the OSCE chairmanship

PSD President Marcel Ciolacu said recently that a distinction should be made between Austrian citizens and political leaders in Austria and that when he spoked of sanctions, he was referring to situations where Romania could also use its veto against Vienna.  The PSD president said that Romanians still work in Austrian companies in Romania  

 “Let’s make a distinction. In these Austrian companies in Romania, I want to remind you that there are Romanian workers. When I talked about sanctions against Austria, not against the Austrians, if you used an unjustified veto, then do not expect, for example, when Austria applies for the OSCE chairmanship, that Romania will not use the same veto. Until that parallel is reached, however, there are diplomatic moves to close these things down (…)”.

The Organisation for Security and Cooperation in Europe has the role of preventing conflicts, managing crises and coming up with reconstruction solutions for war-stricken states. It is the key institution that Austria wants at all costs in the current context, when a full-scale war has broken out in Europe after almost 80 years of peace. The conflict between Russia and Ukraine brings tasks of major interest to the OSCE. A few days after Austria humiliated Romania with a no vote on the pretext of migration, Chancellor Karl Nehammer has appointed himself as mediator in Putin’s war.  He invoked Austria’s status as a neutral, non-NATO country known for its close relations between Vienna and Moscow.

“We are a neutral country, we have a special status in the EU and that’s why it was important for me to try to play a mediating role”. (…) “However, we have a clear position on humanitarian corridors, ceasefire and objective investigation of war crimes”, the Austrian chancellor said, as quoted by orf2.at.

The OSCE includes Russia and 56 other countries discussing security situations. Crucial discussions on post-war reconstruction or crisis management take place in Vienna, where the OSCE is headquartered.

Bulgaria – a different kind of reaction

President Rumen Radev says securing the EU’s external borders is impossible without Bulgaria’s admission to the Schengen area, while ordinary people believe Bulgaria is seen as a second-class country. Following the vote on the 8th of December, when the Netherlands opposed Bulgaria’s acceptance into Schengen, a debate has started online in the neighbouring country, with many Bulgarians proposing that the countries of the Balkan Peninsula form their own alliance, the Little Schengen, referring to Bulgaria, Romania and Turkey. The idea has been taken up by Fakti, which has launched a new poll on the subject. Asked whether they would like the border between Bulgaria and Romania to be dismantled after the refusal of Schengen membership, 67% of respondents agree with such a measure, 22% reject it, 4% cannot decide and 8% of Bulgarians say they do not care.

At the same time, Romanian Prime Minister Nicolae Ciucă says that joining the Schengen area is a measure that each country must take, but “decoupling” Romania from Bulgaria on this issue seems unattainable.

“We are currently discussing with the European institutions and with the Czech Presidency to identify the immediate solutions that can be taken and we are also discussing with the Swedish side because they are about to take over the presidency from the Czech Republic and to analyse the advisability of the accession decision on the Council’s agenda”, said Ciucă.

Asked whether President Klaus Iohannis could ask the European Council next week to re-discuss this issue and convene an extraordinary JHA Council, the Prime Minister replied that the Foreign Ministry and the European institutions are currently discussing possible solutions and steps that could lead to a favourable decision.

“Otherwise, to put the subject back on the agenda when Austria maintains its political decision not to agree with Romania’s accession, I do not think it is appropriate to set a deadline for a decision,” Ciucă said.

Asked about a decoupling from Bulgaria in this dossier, the Prime Minister said it was a “measure that we have to analyse”.

“It is a step that each country must take individually,” Nicolae Ciucă said.

He claimed that a decoupling from Bulgaria was discussed at Thursday’s JHA Council meeting, but was not approved by Bulgaria and Austria.