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Books on Moldova
REPUBLICAN REFERENCE
Area (sq.km)
33,843
Population
4,446,455
Principal
ethnic groups
Moldovans 64.5%
Ukrainians 13.8%
Russians 13.0%
Capital
Kishinev
(Chisinau)
Currency
Leu (plural: Lei)
President
Vladimir Voronin
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Update No: 311 - (29/11/06)
Georgia, Moldova okay to settle "frozen"
conflicts jointly
Georgia and Moldova have a lot in common, parts of their territories which are
secessionist with the backing of Russian security forces, not necessarily
obeying the Kremlin. They have decided to cooperate in settling these
"frozen" conflicts.
This issue was in the focus during the meeting between Moldovan President,
Vladimir Voronin, and Georgian Foreign Minister, Gela Bezhuashvili, when the
Georgian minister arrived in Moldova recently for a two-day official visit.
The sides expressed assuredness that "the problem of the 'frozen' conflicts
may be resolved only if the territorial integrity of the two countries is
maintained," the press service of the Moldovan president said.
Voronin, in his turn, voiced confidence that Tbilisi and Chisinau "will
settle other problems together. One of those problems is the advancing of our
countries to Europe," he said. "Moldova already has certain experience
and is ready to share the benefit of this experience with Georgia," the
Moldovan president said.
Bezhuashvili recalled that Georgia was expected to sign an action plan with the
European Union, which is similar to that concluded between Moldova and the EU
earlier. In his words, Georgia is interested in Moldova's experience with
hosting the EU border mission, which began monitoring the state border with
Ukraine, including its Dniester stretch, starting from December 1, 2005.
Troubles with Russia
Russia's relations with Moldova have deteriorated since Moldova's ruling
communist party took a pro-Western stance in early 2005.
The Moldovans have a lot of trouble with the Russians, who have huge leverage
over them. Russia has long been the main supplier of energy and raw materials,
while it used to take the bulk of Moldovan wine and tobacco exports.
Moreover, there are over one million Moldovans living in Russia, who send
remittances home worth US$1-1.5bn per annum. They are the breadlines for many
Moldovan families. Russia's hold is almost as great as in the Soviet days, only
more ruthlessly exploited.
Moscow banned Moldovan wine imports earlier this year, supposedly for reasons of
defective quality, but really to put pressure on Chisinau to end its own embargo
on trade with Transnistria, which is a den of smuggling and corruption, run by a
notorious reprobate, Igor Smirnov, thick as thieves with Russian mobsters. He is
standing for a fourth presidential election that he will certainly win hands
down, (his people 'count' the votes). There is nothing Chishinau can do about
it.
Russia hopes to complete WTO talks with Moldova, Georgia soon
Relief is coming from Russia's desire to be acceptable on the international
stage.
Russia hopes to complete talks on its accession to the World Trade Organization
(WTO) with Georgia and Moldova in the near future, Andrei Kondakov, director of
the economic cooperation department of Russia's Foreign Ministry, said,
ITAR-TASS reported. "We hope that (Georgia and Moldova) will be
constructive and we'll be able to complete negotiations with them in the near
future," he said.
Meanwhile, in early November Russia's Economic Development and Trade Ministry
said that Russia and the U.S. had reached an agreement on Russia's WTO accession
and planned to officially sign it. Alexei Gromov, Russian President Vladimir
Putin's press secretary, said that Putin and U.S. President George Bush had
pledged at a meeting earlier on that day to sign an agreement on Russia's WTO
accession on November 13th in Hanoi, the capital of Vietnam.
Message to Moscow
The Moldovans are fed up with the Russians meddling in their affairs. The
Moldovan parliament on October 12th adopted a resolution calling on Russian
lawmakers to stop supporting separatists controlling the Transnistria province
in eastern Moldova.
Pridnestrovie, also known as Transnistria or Trans-Dniester, is embroiled in a
16 year- old territorial claim with neighbouring Moldova. A hot war, which ended
with a ceasefire agreement in 1992, has now been replaced by a cold war and an
information war, in which both sides accuse the other of numerous unproven
misdeeds.
By a law passed in 2004 Russia's State Duma, the country's lower chamber of
parliament, decreed that it could absorb certain break-away territories of
former Soviet republics, so long as it was done 'peacefully.' They had in mind
primarily Abkhazia and South Ossetia in Georgia and Transnistria in Moldova. The
current crisis between Georgia and Russia is making the Moldovans fearful on
their own account.
Moldovan lawmakers criticized the Duma more recently for questioning Moldova's
territorial integrity by supporting a controversial Transnistria referendum,
held in September, where 97 per cent of the region's voters endorsed a proposal
to unite with Russia. In early October, the Duma adopted a statement, approved
by a 419-0 vote, saying the referendum had been conducted legally and that its
results "should be taken into account by the international community"
in order to protect human rights, peace and security and resolve the dispute
over the region. Russia should also take into account "the free expression
of the will of the people of Transnistria" when building its policy, it
said, suggesting that the government should be more aggressive about supporting
their hopes of joining Russia.
Moldova's parliament said that the statement was unacceptable under
international law and that Russian lawmakers openly acted as an advocate for the
separatists. Moldova and the Organization for Security and Cooperation in Europe
(OSCE) did not recognize the referendum.
The Moldovan President Vladimir Voronin has said the Transnistria region is run
by an undemocratic regime that fosters organized crime, and has called on Russia
to withdraw its 1,500 troops stationed in Transnistria. It is notorious for its
smuggling activities conducted by those with close links to the Russian
underworld, including, it was widely thought until recently, arms-dealing.
However, Moscow will have none of this; and curiously, now nor does some
reputable opinion in the West, such as that of the OSCE, but this organisation
of course for many FSU state in membership.
Russian Defence Ministry survey states no unauthorized sales of stored
arms from Transnistria, which sets out one parameter of the dispute and will not
be the last word on the subject
A month-long survey carried out by Russia's Ministry of Defence states that all
stored weapons in Transnistria are fully accounted for. This refutes speculation
by Moldova that the weapons might have been sold on the black market - at least
in the eyes of Moscow. Most have already been removed or destroyed under the
supervision of the OSCE, the survey concluded, giving endorsement they say that
has been approved by the US State Department too, but no evidence of that is in
the public domain.
The audit and physical on-site review was initiated by an order from President
Putin, following a meeting earlier this year with his Moldovan counterpart,
President Voronin of the Communist Party. Voronin, a former Soviet-era Major
General, has much in common with Putin, not just a shared Christian name
'Vladimir,' but a past career in the Soviet security network, in which Putin was
a KGB operative, and a long-time communist background. They respect each other,
which is decidedly not the case with Putin and US-educated and Western -inclined
Georgian President Mikhail Saakashvili, who has been consistently denied a
private audience with the Russian ruler.
In that common origin lies hope for a more measured outcome in Moldovan-Russian
affairs than is prevailing in Georgian-Russian relations right now. In the
meeting, Voronin repeated claims by Chisinau that stored weapons guarded by
Russia in Transnistria were finding their way to the black market.
All weapons fully controlled and accounted for
"With the president-to-president agreement on the audit, and the
successful finding that none of these claims are true, these fears are now laid
to rest," claims a Russian Defence Ministry spokesman, Major General Boris
Sergey.
He emphatically denied claims and rumours that Pridnestrovie (another name for
the breakaway enclave) was leaking Russian weapons, and that Russian weapons
stored in the area were being siphoned off for unauthorized sale on the black
market. On 12th October, Sergey produced the findings of a special commission
from Russia's Defence Ministry which for 20 working days - four weeks in total -
was involved in a full audit of all stored weapons deposits located in
Pridnestrovie, between Ukraine and Moldova.
According to the Major General, the group of generals and commissioned officers
of the main rocket artillery administration of the Ministry of Defense satisfied
itself that "nothing was missing or unaccounted for. Not a single pistol,
nor machinegun, not a single grenade, nor any other type of weapon."
That is categorical enough. Is it true?
Who to believe?
Approximately 800 Russian troops are involved in guarding and dismantling an
old Soviet-era ammunitions dump in Kolbasna, in northern Transnistria. The
majority of the ammunition has by now been removed from Kolbasna under the
supervision of the OSCE. Military equipment which it is impractical to remove
has been undergoing on-site destruction. The U.S. State Department has publicly
stated that the process of removal of ex-Soviet munitions and equipment has been
carried out with efficiency since 2003.
Chief among the Moldovan claims against Pridnestrovie, another name for the
enclave, is that the unrecognised country is a "black hole" and a hub
for weapons smuggling. Tiraspol, its capital, counters by pointing out that as a
landlocked country with no airport, all exports - legal or illegal - must go
through either Moldova or Ukraine, making weapons smuggling next to impossible,
and that Moldova's accusations have absolutely no basis in reality.
Actually this is highly disingenuous of Tiraspol. After all the enclave owes its
existence to the fact that it is separated from Moldova proper by a great river,
the Dniester, giving it its name, that flows right into the Black Sea! Also
Ukraine under Kuchma was believed to be wholly complicit in delivering these
weapons internationally.
Western diplomats agree with Tiraspol, however, having stated to US-funded RFE/RL
that Moldova's claims are wildly exaggerated. OSCE and European Union officials
state that there is not a single piece of evidence to indicate that the country
has ever trafficked arms at any time in the past.
Well, well. It is a question of who you believe. The affair calls to mind the
dictum of the radical UK journalist, Claud Cockburn, in the 1930s that he never
believed in a rumour until it had been officially denied!
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ENERGY
Moldova opens US$38m oil terminal on Danube
Moldova on October 26 opened a US$38 million oil terminal on the Danube River,
for the first time linking the land-locked country with international ship
traffic, New Europe reported.
The Free Port Dzhurdzhulesht is located at the southern tip of the former Soviet
republic. "This will enable our country to receive oil shipments from
abroad," said Moldova President, Vladimir Voronin, at an opening ceremony
of the port. Moldova's government completed the installation in cooperation with
the Azerbaijan energy company Azpetrol for an estimated total cost of US$38
million, with US$27 million raised by the Azerbaijan firm.
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FOREIGN LOANS
World Bank to provide US$10 million to help boost growth
The World Bank is to provide the Moldovan government with US$10 million to
finance work aimed at accelerating economic growth and increasing the
effectiveness of social programmes, Interfax News Agency reported.
Slavian Gutu, spokesman for the World Bank office in Moldova, said the Eurobond
board of directors approved the credit at a meeting in Washington. "The
credit is being provided for 40 years with a 10-year grace period at 0.75 per
cent per year. It will be used to implement a strategy of economic growth and to
reduce the level of poverty. Investment is planned in repairing roads, the
social sector and rural development," he said. "Although in recent
years the poverty level in Moldova has fallen significantly, it is necessary to
increase state investment in infrastructure and in social services," Gutu
said.
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INVESTMENT STRATEGY
Moldova approves investment strategy
The Moldovan government has approved the strategy for attracting investment and
promoting exports for the period until 2015, RBC news service reported.
Economy Minister, Igor Dodon, said the document contained a new outlook on the
process of attracting investment and promoting Moldova's exports. The strategy
puts a special emphasis on developing the infrastructure, such as modernizing
the road network, developing free economic zones and industrial parks. During
the period of the implementation of the strategy in 2006-2015, Moldova plans to
achieve direct foreign investment growth of 10 per cent per year, fixed
investment growth of 8.0-15 per cent per year, and export growth of 10-15 per
cent per year, Dodon stated. Moldova also intends to expand the range of its
exports, and broaden and diversify its export markets, he added. To achieve
this, the republic will provide tax preferences and hold a tax amnesty, among
other stimuli to raise investment.
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TRADE DEFICIT
Foreign trade deficit grows 36% in 9 months
Moldova's foreign trade deficit grew 35.8 per cent year-on-year to US$1.1
billion in January-September 2006, a source at the national statistics bureau
said, Interfax News Agency reported.
Exports dropped 8.2 per cent to US$718.6 million in the first nine months, but
imports grew 14.5 per cent to US$1.8 billion. Imports from the Commonwealth of
Independent States dropped 23.5 per cent to US$303.7 million, which helped cause
the reduction in exports. Exports to Russia, which is considered Moldova's
biggest trading partner, fell 45.6 per cent to US$142.3 million.
Russia accounted for 19.8 per cent of total exports, compared with 33.4 per cent
in the first nine months of 2005. Exports to the European Union grew 6.5 per
cent to US$239.5 million. Exports of food products, beverages and tobacco
products fell 30.7 per cent to US$197.3 million in January-September 2006.
Exports of textile materials and products grew 11.5 per cent to US$163 million,
while plant-based exports dropped 3.2 per cent to US$84 million.
Imports from the CIS rose 10.1 per cent to US$704.5 million. Imports from Russia
grew 50 per cent to US$273.1 million and 6 per cent to US$559.3 million from the
EU. Imports of mineral resources grew 31.2 per cent to US$458.7 million. Imports
of machines, appliances and equipment rose 8.2 per cent to US$248.9 million and
imports of chemical industrial products rose 3.3 per cent to US$158 million.
Exports stood at US$83.4 million and imports at US$230.5 million in September
2006. Moldova's foreign trade deficit grew 23.5 per cent to US$1.22 billion in
2005. Exports grew 10.7 per cent to US$1.09 billion and imports rose 30.7 per
cent to US$2.31 billion.
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