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Key Economic Data 
 
  2003 2002 2001 Ranking(2003)
GDP
Millions of US $ 1,964 1,621 1,500 141
         
GNI per capita
 US $ 590 460 400 157
Ranking is given out of 208 nations - (data from the World Bank)

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Update No: 315 - (29/03/07)

Moldova refuses mass conferral of Romanian citizenship 
Moldova and Romania have seen their relations sour since the latter joined the EU in January.

In a series of statements on March 3 through 7, Moldova reacted furiously to Romania's ongoing attempts to confer Romanian citizenship to Moldova's residents en masse. With Romania's accession to the European Union effective January 1, Bucharest believes that a large part of Moldova's population will be tempted to take up Romanian citizenship in order to travel freely on EU territory.

Chisinau, however, believes that Bucharest uses the citizenship issue in order to pave the way for a de facto merger of Moldova, or at least of right-bank Moldova (Bessarabia), with Romania. The issue puts Bucharest at odds with the EU as well.

On March 3 Moldovan President Vladimir Voronin accused Romania of engaging in "impertinent, unvarnished" attempts to undermine Moldova politically, with a view to uniting it with Romania. In his live interview with a Russian-language television channel in Chisinau, Voronin complained of Bucharest's "mocking attitude toward our country and state," financing a "fifth column" in Moldova, pursuing "state revanchism," and treating Moldova's independence as a transitory stage toward unification with Romania.

Voronin derided Bucharest's frequently repeated offers to function as a "locomotive" pulling Moldova toward the EU and as an "advocate" of Moldova within the EU. He seemed to have an easy time turning down "those who foist themselves on us," considering Romania's difficult accession to the EU and the ongoing spectacle of that country's political crisis, which saps Bucharest's credibility in Brussels. "We have advocates in many European countries, thankfully," Voronin remarked.

On March 6, the Moldovan government followed up with its own declaration. It accused Romania of practicing "duplicity," "undermining Moldova's national security and its statehood," and "pursuing ulterior motives" [code word for absorption into Romania]. It urged Romania to sign the inter-state political treaty with Moldova that was initialed by both countries in 2000 but was then abandoned by Bucharest, as well as the border treaty that was prepared for signing in 2000. The Moldovan government is asking its "European and international partners to exert their influence and bring Romania's policy onto a normal track of good-neighborly relations [with Moldova] in a European spirit."

Chisinau regards the fate of those two treaties as a test of Bucharest's long-term acceptance of a Moldovan state. Both documents have been under negotiation since 1992, and all Moldovan governments since then have urged Bucharest to sign the two treaties. Bucharest insisted all along on introducing historical and philological references unacceptable to Chisinau into the political treaty. More recently, the argument privately adduced to Western officials is that the Romanian parliament could not ratify a document that lacks such references.

On March 7 Moldovan Minister of Foreign Affairs and European Integration Andrei Stratan announced that Moldova has decided to turn down Romania's request to open two additional consulates or consular offices (other than the embassy and consulate in Chisinau) in Moldova. The Moldovan government, keenly interested in free travel by its citizens to Romania despite political controversies, had in recent months considered Romania's request for additional consulates. Once it turned out that the proposed consulates would issue Romanian citizenship, not just visas, Chisinau decided against the proposal.

The drop that seems to have over-filled the cup of Chisinau's patience (a cup notoriously of almost inexhaustible capacity) is Romanian President Traian Basescu's March 2 declaration. In urgent tones, Basescu asked the Romanian government to accelerate procedures for granting Romanian citizenship to applicants from Moldova. Basescu estimated the number of citizenship applications from Moldova at 800,000 -- the same number he cited publicly during his January 16 visit to Chisinau, when the two leaderships were still on speaking, though far from cordial, terms.

That estimate may well be exaggerated. But whatever the actual number, those applicants are (under the existing procedure) requesting a preliminary appointment with Romanian consular officials, whether for passports or just visas. Basescu's statement calls for shortening that procedure and handing out citizenship papers rapidly to applicants. In several speeches during recent months, the Romanian president called both in open and veiled terms for Moldova's (or "Bessarabia's") unification with Romania.

Bucharest's decision to "come to the aid" of Moldovans with the offer of Romanian citizenship may well, however, stem from a selfless motive. Until January 1 Moldovans were able to enter Romania in great numbers visa-free in order to work, study, or visit relatives. But as a new member of the EU, Romania had to introduce entry visas for Moldovans at the EU's insistence. Granting citizenship to Moldovans would circumvent the EU-imposed visa requirement and enable Moldovans not only to enter Romania freely as before, but also in some cases to travel within the EU as newly minted EU citizens.

Bucharest's policy on this issue irritates the EU on several counts. Anxious to avoid a migratory flow of Moldovan holders of Romanian citizenship to the EU, Brussels is offering Moldova a visa-facilitation agreement in the short term (with the next step, visa-liberalization, a possibility) and wants to consolidate Moldova's statehood for the long term. At this stage, irredentist rhetoric from Bucharest raises the possibility of partitioning Moldova along the Nistru River and consolidating Russia's hold on Transnistria as a second Kaliningrad, instead of loosening that hold.

The EU has decided to set up a joint visa application and issuing center in Chisinau for entry and transit visas to certain EU member countries. Hungary is designated to administer the centre in its embassy there, with participation by Austria, Slovenia, Denmark, Estonia, and Latvia.

The Romanian government recently sought to reverse or amend that decision after the EU had already made it. The Centre is due to open in April of this year, although Bucharest is said to persist with objections in Brussels.

While continuing to complain that Bucharest "insists on defining us as [ethnic] Romanians," Chisinau's latest reactions to Bucharest's initiatives on citizenship make clear that the dispute has escalated beyond issues of history and national identity, now seemingly revolving around Moldova's continuation as a state. However, on one count at least, Bucharest demonstrates statesmanship by refraining from direct polemical responses to Chisinau's recent statements.

Moldovan-Romanian divisions
The Moldovan government has reversed its decision to allow Romania to open two new consulates in the country. Relations between the two countries have deteriorated in the past year. The decision follows criticism from the authorities in Chisinau, who called Romanian policy towards Moldova "duplicitous." 

The consulates were aimed at easing a backlog of applications from Moldovan citizens who now need visas to travel to Romania. 

The Moldovan authorities hinted that a change was coming, and now it is official: the opening of two new Romanian consulates, in the towns of Balti and Cahul, will not be going ahead. 

The authorities in both countries were taken aback by the chaotic scenes in front of the Romanian embassy in Chisinau in early January, just after Romania joined the EU. 
Hundreds of angry people waited for days just to register their applications, amid confusion over documents and procedures. Many of them simply wanted to transit Romania to work in other EU countries. 

Romanian President Traian Basescu visited the embassy and promised rapid improvements. The Moldovan President, Vladimir Voronin, initially agreed to the opening of two temporary consulates. 

This idea of re-unification is now no longer on the cards, as the government is becoming ever more suspicious of Romania's intentions.

The Moldovan foreign ministry recently complained to the EU that Romania's policy was "duplicitous" because it exaggerated the number of Moldovans seeking to gain Romanian citizenship. 

This is a long-standing source of tension between the two countries. 

Last year, while meeting Moldovan students enrolled at Romanian universities, President Basescu spoke of a future in which Romania and Moldova could be united within the EU. 
He made a similar statement in a BBC interview on Wednesday. The idea was promptly rejected by Moldovan President Vladimir Voronin, who said that "Moldova will not unite with anyone, ever." 

Mr Voronin wants to move his country ever closer to Europe, but dismisses any suggestion that this would imply a change in its relationship with Romania. 

                                        ******

For most informed people the Moldovans and the Romanians are very alike. Moldova was part of Romania from 1918 to 1940 and the two countries share the same ethnic and linguistic background. 

Stalin had other ideas and extracted Bessarabia from Hitler is a part of their infamous deal, that set off the Second World War. 

The following is by a recent US student, resident in Moldova:-

Moldova: What's Behind Harsh Criticism Of Romania? 
By Ryan Kennedy 
Statements about Romania by Moldovan officials have recently become increasingly harsh. Officials accuse Romania of trying to undermine Moldova's statehood and security. What underlies this negative turn in Moldovan-Romanian relations?

Recent statements by Moldova's government have made headlines for their caustic tone toward neighbouring Romania. President Vladimir Voronin in early March attacked Romania for "financing a fifth column" in Moldova and not respecting Moldovan independence.

The Moldovan government has also criticized the Romanian leadership for "concocting and artificially aggravating" the issue of Moldovan application for Romanian citizenship. Romanian President Traian Basescu recently estimated that the total number of Moldovans seeking to obtain Romanian citizenship could exceed 800,000.

The statement also argued that Romania's refusal to sign a basic political treaty and a border treaty "cannot but be interpreted as a proof of the neighbour state's true intentions."

About the same time, Andrei Stratan, Moldova's minister of foreign affairs and European integration, reversed an earlier decision to open new Romanian consulates in Balti and Cahul.

The additional facilities were meant to ease workload on visa applications for Moldovans looking for work in Romania. Stratan, announcing his decision, said the new buildings were no longer necessary.

For its part, the Romanian government has refused to respond to these accusations, defending their policies as an attempt to re-establish free trade and movement that existed between the states before Romania's accession into the European Union on January 1, 2007.

To some extent, the harsh tone of Moldova's rhetoric toward Romania is an extension of Moldova's general foreign policy. However, the timing of these statements suggests that this is also part of an effort to improve relations with Moscow and the breakaway region of Transnistria.

Ups and Downs 
Moldova and Romania have experienced many ups and downs in their relationship since Moldova's independence in 1991. While pan-Romanianism has been a consistent part of Moldovan politics, and was adopted in the Popular Front of Moldova's platform in 1992, it has played only a minor role in Moldovan policy.

The Front's term in office under Prime Minister Mircea Druc was brief, and its successor, the Christian-Democratic People's Party, has only entered government in coalition with the Communist Party.

After calls for unification failed to gain widespread support, relations with Romania cooled considerably. In 1992, Moldova and Romania started negotiations on inter-state political and border treaties. Both treaties were prepared for signing in 2000, but they have yet to be approved by the Romanian government.

One of the low points in bilateral relations came during the 1994 parliamentary elections, when several Moldovan political parties denounced Romania's interference and its assertion that the Moldovan language and culture were Romanian. Romania, in turn, accused the Moldovan government of using the identity question to stifle dissent.

The 2004 elections in Romania began a period of improved relations. The newly elected Romanian president made Moldova his first official trip abroad, and the states found common ground as Moldova set EU integration as the country's main strategic foreign policy goal.

Two States, One Nation? 
Romania's official policy toward Moldova is "one nation, two states," based on shared history, language, culture and traditions.

In contrast, Charles King, a professor at Georgetown University, describes Moldovan foreign policy as "Bessarabism."

This policy orientation defines Moldova as "a distinct cultural and political space, a region whose traditions and interests derive both from its position as a small region surrounded by large neighbours and from the overlapping identities of its multiethnic population."

From this perspective, recent statements from Romania about citizenship rules may seem hostile, and the magnitude of citizenship applications claimed by Romanian officials are somewhat embarrassing to the Moldovan government.

In addition, the government has already expressed its concern about the size of its population working abroad -- as many as 1 million Moldovans -- and has encouraged its citizens to stay home. It is understandable that they would be concerned about the easing of citizenship requirements, which would allow easier exit to EU labour markets.

The current government has an incentive to reassert its commitment to an independent Moldova with local elections approaching. Many Moldovans do not support unification, and this is especially salient among Moldova's linguistic minority groups.

The Price of Transnistria 
Yet, the harsher tone of Moldovan officials toward Romania started well before these most recent statements. A month before Romania's formal accession to the EU, President Voronin slammed Romania's offer of help in Moldova's EU integration, saying "Romania is trying to impose certain rules of the game and principles of Moldova...this should be qualified as interference in the domestic affairs of a sovereign state."

It is interesting that the December 1 statements from Voronin came only a couple of days after Russia announced that it would end its ban on Moldovan wine. It also fell between the September referendum on independence and the December presidential election in the breakaway region of Transnistria.

In his New Year's address, President Voronin expressed his belief that 2007 will be "the year when the genuine and final reintegration of our motherland will start."

It makes sense that, as part of this strategy, Moldova would increase its efforts to resurrect the inter-state political treaty and border treaty with Romania as a method for allaying the concerns of Eurasianists in Transnistria and the regime's sponsors in Moscow.

As Nicu Popescu, a research fellow at the Center for European Policy Studies, puts it, "The true architect of the foreign policy of Moldova since the declaration of its independence has been neither Mircea Snegur, nor Petru Lucinschi, nor Vladimir Voronin, but [Transnistria President] Igor Smirnov."

The Shorter Long Shot 
With EU enlargement put on hold indefinitely, and territorial integrity an important part of Moldova's EU integration strategy, Moldova's cooling of relations with Romania can be interpreted as an attempt to reassure leaders in Tiraspol and Moscow that this administration is not moving closer to Romania.

Reintegration with Transnistria is a long shot, and Russia continues to delay the restoration of economic ties that are essential to Moldova's economy. But criticism of Romanian policy still presents a low-cost method for Moldova to further a number of its political goals.

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ECONOMIC NEWS

GDP to grow 5% annually in 2007-2009

The Moldovan Economy and Trade Ministry expects annual GDP growth to reach at least 5 per cent in 2007-2009 compared to four per cent in 2006, Economy and Trade Minister, Igor Dodon, said, Interfax News Agency reported.
In December 2006, GDP was expected to grow 3 per cent in 2007, he said. "Inflation will be 10 per cent in 2007, 8 per cent in 2008, and 6 per cent in 2009," Dodon said, adding that these figures are "absolutely realistic, given balanced monetary and tax policy and deeper structural reforms." Speaking of economic priorities in 2007, the minister mentioned the improvement of the investment climate, a reform of the legislative basis, and support of small and medium-sized businesses. Among positive trends in the Moldovan economy in 2006, Dodon mentioned growth in investment in the fixed assets to 9.5 billion lei, which is 17 per cent higher than in 2005, while the target was 7.3 billion lei, the diversification and growth in exports to EU countries, and the improvement of social indices.

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