Failed market insertion in Romania’s chemical industry: evidence from two former state-owned enterprises

Abstract

This article describes the micro-foundations of failed market insertion in Romania’s chemical sector. During the EU pre-accession period, transnational integration regimes (TIRs) induced FDI-dependence. In turn, mass-privatization policies in conjunction with weak state capacities—evidenced by domestic development policies with limited operational use—caused failed market insertion. Two former state-owned enterprises (SOEs) are analyzed in this manner, and two pathways to failed integration emerge: via domestic mismanagement and multi-national corporations’ (MNCs) rent-seeking practices. The findings extend the diversity of the TIR framework and provide a nuanced account of downturn scenarios during EU integration.

Keywords:

• transnational integration regimes
• failed market insertion
• deindustrialization
• dependent market economy
• chemical industry
• Romania

Disclosure statement

No potential conflict of interest was reported by the author.

Notes

1 Ford acquired Automobile Craiova in 2007 and received state aid. Retrieved from: https://www.bursa.ro/privatizarea-automobile-craiova-incheiata-69602423

2 The “success story” of Dacia-Renault. State officials advocated for the retention of 14,000 employees. Retrieved from: https://www.zf.ro/zf-20-de-ani/zf-20-ani-1998-guvernul-radu-vasile-semnat-privatizarea-dacia-catre-renault-louis-schweitzer-vizionarul-daciei-moderne-iar-cifrele-spate-arata-cea-spectaculoasa-renastere-unei-companii-romania-17564892

3 The 563/1999 decree is accessible online: https://legislatie.just.ro/Public/DetaliiDocument/18797

4 Adevărul, 21 September 2020. Ultima mare rafinărie „comunistă” din România va fi demolată. Investitorul din SUA s-a dovedit o iluzie [The last communist refinery in Romania will be demolished. The USA investor proved to be an illusion]. Retrieved from: https://adevarul.ro/locale/pitesti/ultima-mare-rafinarie-comunista-romania-demolata-investitorul-sua-s-a-dovedit-iluzie 1_5f6718045163ec427126fa3b/index.html

Additional information

Notes on contributors

Zoltán Mihály

Zoltán Mihály is a researcher and associate teacher at the Faculty of Sociology and Social Work, Babeș-Bolyai University, Romania. His research focuses on work, employment and human resources management embedded in contemporary political economy.