By Sam Cage
BUCHAREST (Reuters) - A bitter dispute between Romania's president and prime minister resurfaced on Wednesday, raising doubts over the running of the country with an election due in December.
Leftist Prime Minister Victor Ponta tried to remove Traian Basescu from office in the summer in a spat which angered the EU and raised questions over policy and an International Monetary Fund deal that shores up investor confidence.
Basescu attended a meeting of the European centre-right parties in Romania's parliament building, a huge marble palace built by communist dictator Nicolae Ceasescu that dominates the city, and Ponta said his presence was inappropriate because the president is supposed to be politically neutral.
"I think the best would be to call out to all of them - down with Basescu," Ponta told a cheering rally of some 60,000 supporters at the national stadium, staged at the same time.
"They have to listen to you, to millions of Romanians, to what you say about Basescu."
Ponta's Social Liberal Union (USL) drew on discontent with austerity and cronyism to dispatch an old Basescu-allied government in a parliamentary confidence vote in April then moved against the president.
The dispute brought sharp European Union criticism of Ponta's tactics, forcing his government to back down and respect a Constitutional Court requirement for minimum turnout of at least half to make a referendum on Basescu's impeachment valid.
Although 88 percent of those who voted wanted the president removed, he survived because turnout was only 46 percent. While the enmity has since simmered down a little, Ponta says Basescu is an illegitimate president and the two men can still barely stand to be in the same room.
Basescu can only delay laws rather than block them but he nominates prime ministers and has control over the appointment of judges, prosecutors and secret service heads.
"Thank you very much for the support you gave our institutions to remain in position at a difficult moment in the summer," Basescu told German Chancellor Angela Merkel, who also attended the centre-right meeting.
The turbulence and approaching election have raised doubts among investors over how closely Romania will stick to reforms required under its 5 billion euro aid deal led by the IMF. The cost of insuring Romanian debt against default rocketed over the summer and the leu currency remains near all-time lows.
The USL has opinion poll ratings of more than 50 percent but the failed impeachment has knocked its popularity and if it fails to win an outright majority in December, Basescu may have room to appoint one of his allies to form a coalition.
(Editing by Myra MacDonald)