Repercussions of the Ukraine Crisis for Moldova

01:07 PM 16-7-2014

Senior research fellow of the IWP Leonid Litra “Moldova: A Sinuous Road to Europe”Moldova, a neighbor of Ukraine and home to one of the frozen conflicts nurtured by Russia (in Transnistria) is one of the smaller countries in which the crisis in Ukraine has had substantial effects. Decision-makers in Chisinau are seriously concerned about the potential threats the crisis may pose for Moldova, while at the same time keeping them from dominating the domestic agenda and public discussion. Their concern is to avoid further complications on the Transnistrian issue and in its relationship with Russia.\
Moldova’s relations with Russia were tenuous even before the crisis broke out in Ukraine. Over the past two years, Moscow became increasingly vocal about Moldova, most notably through the flamboyant statements of Russian Deputy Prime Minister Dmitry Rogozin, who repeatedly indicated Moscow’s dislike of Moldova’s association with the EU. According to Rogozin, “Moldova’s train en route to Europe would lose its cars in Transnistria.”
He threatened that Moscow would recognize Transnistria’s independence, should Chisinau sign the Association Agreement with the EU, which had been negotiated for the past three years and was initialed in November 2013 at the Vilnius summit (and formally signed on June 27, 2014).In order to deflect Russian spin and propaganda on the effects of the Association Agreement and its Deep and Comprehensive Free Trade Agreement (DCFTA) on the Transnistrian region, the government of Moldova astutely invited representatives of the Tiraspol de-facto administration, the secessionist administration in Transnistria, to take part in the negotiations over the Agreement. Their presence at the negotiations, however, did not change their attitudes toward Chisinau.

Effects of the Crisis

When the crisis in Ukraine erupted, Moldovan officials took a very prudent position. The parliament adopted a declaration on Euromaidan, which was quite balanced, only after a second attempt. Prime Minister Leanca’s government, a coalition of pro-European parties, openly condemned Russia’s annexation of Crimea, which for many in Moldova had parallels with Transnistria. The Moldovan prime minister visited Kyiv on March 17, 2014, on the first days after the new Ukrainian government was invested, in order to reinvigorate Moldovan-Ukrainian cooperation and to coordinate action on European integration, namely the implementation of the countries’ respective Association Agreements. In addition, there is strong cooperation on Moldovan-Ukrainian border security, especially on the Transnistrian perimeter.

The pretext used by Russia to justify its actions in Ukraine, that of “defending” the Russian-speaking minority and its right to self-determination, was also used to refer to Moldova by the Russian media, extensively watched and listened to in Moldova. Separatist movements, allegedly supported by Russia, gained more momentum and intensified their claims to independence, as the Moldovan government proceeded with the association process with the EU. Despite the fact that these movements are marginal, their claims on the need to organize referendums on joining the Customs Union garnered support from pro-Russian media, which distorts the magnitude of these movements. In addition, some of the separatist movements deployed an active paid television campaign in favor of the Customs Union. On February 2, 2014, the Gagauz autonomous region held a referendum on membership in either the EU or the Eurasian Customs Union.

The region is inhabited by a Christian Orthodox, Turkic-speaking ethnic minority, representing about 4.5 percent of the population of Moldova. The referendum was declared illegal by Moldovan central authorities, as it was organized in violation of Moldovan laws. The results, however, merit attention, as 98 percent of Gagauzes voted for Moldova’s integration into the Russian-led Customs Union, and an equal percentage supported independence of Gagauzia, “should Moldova lose its sovereignty.” The leaders of the Gagauz autonomous region have interpreted “loss of sovereignty” as the signing of the Association Agreement with the EU, and it was explained to the population in this way. Moldovan authorities are trying to explain that the signing of the Association Agreement will not result in any loss of sovereignty, but they face an uphill battle. Their message is less spectacular and their means are far less efficient than those of the Russian propaganda machine.

Moldova tried to de-escalate the conflict with the Gagauz authorities and did not prosecute any of those involved in the organization of the illegal referendum, despite the central government initiating criminal proceedings to avoid being portrayed as passive. Chisinau also demonstrated its openness to dialogue by creating a joint commission to discuss the issues standing between the central government and the Gagauz region. However, this commission should not raise high hopes of a solution, as the main aim of Gagauz authorities is to block Moldova’s EU association. At present, talks continue despite the threats of Gagauz leaders to hold a new referendum, this time one for independence. Russia is openly supportive of Gagauz actions. In March of this year, Russian authorities lifted the ban on wine companies located in the Gagauz region, in addition to offering a 35-50 percent discount in the price of gas supplied to the region. Once Moscow realized Transnistria did not hold enough significance to spoil Moldova’s Association Agreement, it resorted to using Gagauzia for this purpose.

Transnistria’s Response to the Ukraine Crisis In the first few months of the Ukraine crisis, Transnistrian leaders adopted a cautious and silent position. Then, on April 16, 2014, after the annexation of Crimea, they quickly claimed independence and announced their desire to join the Russian Federation. A declaration to this effect was adopted unanimously in the de facto parliament of Transnistria, motivated by the 2006 referendum in which 97 percent of voters in Transnistria voted to join Russia, which was actually put on hold by the Russian authorities themselves. Tiraspol authorities have since been obediently followed Russia’s lead and have clamored about the supposed blockade of Transnistria by Ukraine and Moldova, who, Russia claimed, denied entry to citizens from Transnistria holding Russian passports. In fact, the total number of Russian citizens denied entry in Ukraine on the Moldova-Ukraine border on Transnistrian perimeter during January-March 2014 was 62, while Moldovan authorities turned away only one Russian citizen during this time period.

This allegation proved to be just another attempt by Russia to artificially escalate tensions on the southwestern flank of Ukraine. Russia responded to the Transnistrian plea for annexation with indifference. Should Russia decide to follow course, annexation could be accomplished through a mere bureaucratic move, as Chisinau lacks any control over the region and Russian troops have been present in Transnistria for 23 years, albeit as so-called “peace-keeping forces.” However, Transnistrian annexation is not advantageous for Russia. Unlike Crimea, Transnistria does not have any natural resources or a physical connection with Russia. Rather, it is in Russia’s interests to maintain the current situation, as its presence in the region is useful as a means to control Chisinau’s actions, especially in regard to European integration. Moreover, according to the de facto speaker of the Transnistrian parliament, Russia’s financial support in the region reaches $1 billion every year, which includes grants, humanitarian aid, joint projects, and top-ups for pensioners, basically financing the region’s budget deficit, which is around 60 percent of GDP. From an economic point of view, it would be in Transnistria’s interests to accept the DCFTA, given that about 70 percent of goods produced in Transnistria go to the right bank of the Dniester River (Moldova) and onwards to the EU, while only about 18 percent go to Russia. In the same logic, Chisinau canceled taxes for companies from Transnistria that are registered in Chisinau, attempting to raise their interest in the free trade agreement with the EU. Yet politics in the region do not necessarily follow economic rationale.

The Ukrainian crisis has increased the polarization of the Moldovan society, heightening both pro- and anti-Russian sentiments. Thirty-nine percent of Moldovans condemn the Russian action in Crimea, while 40 percent consider the annexation a legitimate action. Only a slim majority in the Parliament has condemned Russian aggression, and there have been attempts by persons associated with Russia to overturn this majority through bribes to MPs in the governmental coalition. Moldovan officials, as well as the population at large, fear future similar attempts that would create serious problems in the process of ratification of the Association Agreement.

As things stand now, Russia does not need to take severe action in Moldova to derail its European course, as the Moldovan domestic situation serves Russian purposes well. A reversal from the AA is still possible in Moldova. According to the same poll quoted earlier, only 29 percent of Moldovans support the country’s full European integration, while an almost equal percentage supports the Customs Union. One-third of the population remains undecided.

With parliamentary elections scheduled for November 2014, there is a high risk that the Communist party, an advocate of membership into the Customs Union and supported by 30 percent of the population, may win. As they have already stated, once in office, they would negate or simply not implement the Association Agreement that was signed in Brussels on June 27, 2014. All Russia needs to do in order to maintain its interests of keeping Moldova in its orbit is to help the Communists and other emerging parties return to power. There is no need for military intervention or major actions. Russia’s infamous propaganda machinery will be very useful in this process. Moldovans are avid consumers of Russian media, which abounds with stories about the disadvantages of European integration and the benefits of the Customs Union. In addition to Transnistria and the Communist party, Russia has yet additional leverage over Moldova: Moldovan migrants in Russia. In a quid-pro-quo reaction to the visa-free regime extended to Moldova by the EU in April 2014, Russia threatened to introduce visas for Moldovan citizens. In practice, it would expel around 200,000 Moldovans who currently live and work in Russia.

For a country of 3.5 million, this is an enormous number to be reintegrated, and a serious hit for a large part of the Moldovan population, which relies on remits from Russia. In 2013, Russia imposed an embargo on Moldovan wines declaring that they did not meet Russian quality standards. Further testing of the wines, including tests performed by French laboratories, did not indicate deviations from international standards, yet the wine embargo remains in place. Compared to the 2006 wine embargo previously imposed by Russia, economic losses now are much smaller. While the 2006 embargo affected 75 percent of the Moldovan wine producers, this number dropped to 35 percent under the 2013 embargo, due to Moldova’s redirection of exports to Europe.

The wine embargo has had several effects. First, in reaction to Russia’s actions, the EU unilaterally liberalized the wine market for Moldovan producers. Second, given the new openness of the European market, Moldovan GDP, which had already grown by 8.9 percent in 2013, has increased in the first trimester of 2014 by 3.6 percent compared to the same period in 2013. Third, most of the producers who suffered in 2006 understood that they need markets free of political influence and started searching for them, making Russia lose another lever over Moldova.

What the EU Could Do
The EU, for its part, invested much hope in the new Moldovan government that took office on May 30, 2013 after a serious crisis within the governing alliance. Although several government actions are still inconsistent with the European agenda, the government of Iurie Leanca has taken
concrete steps in certain reforms, and has made important efforts to speed up the initialing and the signing of the Association Agreement, despite the EU’s continued warning that such logistical preparations require sufficient time. Only after the Armenian reversal and the Ukrainian refusal to sign the Agreement in November 2013 did the EU find faster and more efficient ways to achieve the signature of the agreement, achieved on June 27, 2014.
Ahead of the successful signing of Moldova’s Association Agreement on June 27, 2014, the EU and Moldova have worked together to prevent a diabolical scenario that would be illustrated by Moldova’s failure to sign or ratify the agreement, as well as to show the concrete results and benefits of their cooperation. One step in this direction is the visa-free regime that the EU extended to Moldova as of April 28, 2014. To Chisinau’s credit, this agreement was achieved after a set of painful reforms they bravely implemented. The EU is also visibly active in rebuilding Moldovan infrastructure, which has had direct impact on the population. Yet these efforts are not sufficient to counterbalance the strong influence exercised by the Russian media in Moldova, which spins all success stories presented by Moldova and the EU. At the same time, both the Moldovan government and the EU have been shy about selling their narrative to the Moldovan populace, and consequently risk losing the campaign for hearts and minds.

The United States has also shown a renewed interest in Moldova after the Ukrainian crisis, reiterating its support for the country’s European course and for a solution to the Transnistrian conflict. But beyond symbolic gestures and bold statements, which are of undeniable importance, more practical cooperation is needed, especially in the area of security sector reform. At this point, it will have to be outside the NATO framework, as the Moldovan constitution provides for its neutrality, and challenging this in the current context would only aggravate the situation in the region. Moldova may use the experiences of military cooperation between the Alliance and non-NATO countries such as Sweden, Austria, and Finland as models.

Moldovans were distressed to see their defense minister, Vitalie Marinuta, resign right at the peak of Ukraine crisis. Significantly, this post has remained vacant throughout the Russian operations in and annexation of Crimea. Moldovan decision-makers perceive the current crisis and Russian actions in the region as part of a game played above their league, one that is a problem to be resolved between Russia, the EU, and the United States. Therefore, they feel that the West should establish deterrence mechanisms to prevent Russia from taking further actions. Since the crisis is indeed wider and deeper than Ukraine and the region, the Moldovan government must take the Ukraine crisis more seriously, and it should be more vigilant to minimize its effects at home.

Fortunately, Moldova is not at imminent risk of a Ukrainian scenario, as the upcoming elections have moved Russian focus from hard to soft power, giving Moldova some time to pursue its European path and interests. Thus, the Moldovan government should use this time to work toward electing pro-European parties, while also preparing for an alternative post-election situation. There are two scenarios that would help to avoid instability after elections. In the first, Moldova would receive a very strong commitment from the EU, which the United States would back, just as it did with the Baltic states, standing up for them against Russia. This commitment should be a clear membership prospective for Moldova, beyond allusions to Article 49 of the Lisbon Treaty and various statements meant to distract from such a commitment. While this scenario cannot be controlled by Chisinau, as it lies outside of its decision-making powers and gives the EU the lead in ensuring stability in the country, it may be the Moldovan government’s best choice. In the second scenario, within the powers of Chisinau, Moldova would obtain security guarantees from Russia that it would not be the next Ukraine. This possible outcome would come at a high cost for Moldova, most probably at the cost of federalization by reanimating and updating the “Kozak” plan, which implies a slowing of its relations with the EU, as well as a mechanism to block strategic decisions of Moldova.

Sooner or later, Russia will confront Moldova and the smaller country will have to deal with the issue of its own stability. The events in Ukraine have broken the status quo in the region and the consequences are still unfolding.

The article is a part of the publication “Regional repercussions of the Ukrainian crisis. Challenges for the Six Eastern Partnership Countries”. The full text of the publication can be downloaded for free at

The publication was suppurted by the German Marshall Fund of the United States (GMF)