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Key Economic Data 
  2003 2002 2001 Ranking(2003)
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)

Books on Moldova


Update No: 314 - (22/02/07)

Metamorphosis of a communist
President Vladimir Voronin of Moldova, a former Soviet general, came to power as a Communist leader determined to make his divided, dirt-poor country into another Cuba, perhaps even joining Russia and Belarus in their union state. 
But he soon turned into a moderate social democrat, suspicious of the Kremlin with good cause, and determined to push Moldova to the West, a course for which the West has given him shamefully little support, although there are signs that this may change now that Moldova borders the EU since the accession of Romania on January 1st.
Recent events have accentuated the alienation from Russia, as Moscow last year imposed a trade embargo on staple exports from Moldova, namely fine wines and brandies. The wine sector accounts for around 25% of Moldova's GDP and 80% of its production was exported to Russia. This was lifted in November. Russian habitués of Moldovan products were complaining. But the million Moldovans in Russia are being harassed by petty restrictions. Relations could scarcely be worse.

Confidential Russia-Moldova bilateral negotiations falter 
The time is hardly ripe for a major breakthrough on points in the dispute between the two countries. From September 2006 until late January, Moscow and Chisinau were engaged in confidential bilateral talks on a political settlement of the Transnistria conflict. This channel operated outside the official, 5 + 2 negotiating framework (which consists of Chisinau, Tiraspol, Russia, Ukraine, the OSCE, the European Union, and the United States). However, the Moldovan officials who conducted those bilateral talks -- top presidential adviser Marc Tcaciuc and Reintegration Minister Vasile Sova -- duly informed Moldova's Western partners about the course of the talks at every stage. Nor did they keep Ukraine's Ministry of Foreign Affairs in the dark.
In all, the Moldovan officials made five known visits to Moscow between September 2006 and the end of January. The fact that the visits were taking place was being announced (sometimes post facto) in one-paragraph communiqués, but the content of the talks was not. On the Russian side, Security Council Deputy Secretary Yuri Zubakov ran this channel, with Deputy Minister of Foreign Affairs/State Secretary Grigory Karasin also involved at times.
Chisinau engaged in this effort as part of an all-out, multidimensional effort to persuade Russia to lift its economic embargoes against Moldova and to explore a possible package solution on Transnistria. The Moldovan side was careful to separate the issue of conflict resolution from the trade embargo and energy supply issues, which were being discussed elsewhere, so as to reduce Moscow's direct economic leverage in the Transnistria negotiations.

Moldovan proposals re Transnistria
The Moldovan side came to the table with proposals for Transnistria's political status and full withdrawal of Russian forces. The proposals envisaged, in essence, autonomy for Transnistria, short of "federalism;" no role for Tiraspol in shaping the policies of Moldova's central government (thus leaving the latter free to pursue a Western-oriented course); social-protection guarantees for various categories of civil-administrative and uniformed personnel in Transnistria; replacing Russian "peacekeeping" troops with international, mainly unarmed, peacekeepers; and the continuing neutrality of Moldova (no change in that regard).
The proposals were in line with Moldova's 2005 organic law on the principles of Transnistria conflict-resolution, one of the key ideas of which rules out any "external guarantees" of the settlement, such as Russia proposes to maintain, with its troops in place.
Chisinau held out two incentives for Moscow to go along: Firm assurances that Moldova would not join any military alliance (meaning NATO) and that it would, as part of the settlement package, legalize Russian companies' property takeovers in Transnistria. At present, Russia's Unified Energy Systems, Gazprom, and steel producers control massive assets unlawfully acquired in this part of Moldova.

Russian objections to them
In the final session of talks, held in Moscow at the end of January, the Russian side summed up the objections that it had all along voiced to Chisinau's proposals. 
Moscow insists on the concept of "external guarantees," including military ones with Russian troops, and does not recognize any obligation to withdraw its forces from Moldova's territory. And it gives Tiraspol full latitude to determine what would constitute an acceptable political and even military settlement (while at the same time encouraging Tiraspol to stonewall).
Russia continues to demand that any negotiations proceed from the "understandings reached earlier" [ranneye dostignutyie dogovoryonnosti], a sacramental formula that Moscow equally insists upon in negotiations on the conflicts in Georgia. This formula refers to documents signed during the 1990s under Russian duress, though never legalized in any form, by Moldova or Georgia. In Moldova's case, these include the 1997 Primakov Memorandum and a 1998 document authorizing Tiraspol's authorities to conduct external trade. In essence, these never-ratified documents place Chisinau and Tiraspol on an equal footing as "parties to the conflict" and define Russia (again without any legal basis) as "mediator" and "guarantor," although Russia itself is by all criteria engaged in interstate conflicts against Moldova and Georgia.
In the same final session, Russian side reproached the Moldovans for "working with the West behind Moscow's back" and orchestrating "pressures" on Moscow through the OSCE. On these pretexts, the Russians asserted that they are taking an indefinite "time-out" from the talks.
On the following day, January 30th, Russian Vice-Foreign Minister Karasin received Tiraspol's "foreign minister" (and a Russian citizen from Russia itself), Valery Litskay, in Moscow demonstratively. In Tiraspol on the same day, Supreme Soviet chairman Yevgeny Shevchuk, in unison with Moscow, criticized Chisinau's refusal of "guarantees by the guarantor countries" and its abandonment of "understandings reached earlier," from among which Shevchuk singled out the 2003 Kozak Memorandum [never "reached," however].
In Chisinau, President Vladimir Voronin and Parliament Chairman Marian Lupu received the European Union's Special Representative in the negotiations on Transnistria, Dutch diplomat Adriaan Jacobovits de Szeged, on the occasion of completion of his two-year mission. Voronin and Lupu called for extension of the European Union's Border Assistance Mission on the Transnistria sector of the Moldova-Ukraine border, resumption of negotiations in the 5 + 2 format, upgrading the U.S. and EU roles from observers to full participants in that format, withdrawal of Russian troops, and their replacement by internationally-mandated civilian and military observers
A round of the 5 + 2 negotiations was tentatively scheduled for February 15-16 after a year-long hiatus 

Yes to special EU aid, but subject to MEPs' conditions
The International Trade Committee has given the go-ahead for EU macro-financial aid to Moldova, one of Europe's poorest countries. Forty-five million euros will be provided to support the balance of trade and payments of the country, which has a frontier with the EU since the accession of Romania on 1st January 2007. 
However, in giving the green light to this proposal by the Council, MEPs laid down several conditions for the payment of the funds.
The macro-financial aid, which was approved in a report by Béla Glattfelder (EPP-ED, HU) adopted in committee on January 24th, is intended to help with the deterioration in Moldova's trade balance following the rise in energy prices and the embargo imposed by Russia in 2006 on imports of Moldovan wine and spirits. More generally, Moldova's economy remains highly dependent on agriculture (notably fruit, vegetables and tobacco) and is lacking in natural resources.
MEPs want to make the payment of successive tranches of aid subject to progress in the transparency of Moldova's public finances, the application of macroeconomic and budgetary priorities advocated by the International Monetary Fund and respect for human rights, including minorities.
The report also underlines the "exceptional" nature of an instrument such as macro-financial aid. The rapporteur believes it is "unjustifiable that such an instrument lacks a regular legal basis and continues to be based on ad hoc Council decisions". He calls for future financial aid to be governed by "a co-decided framework regulation" on macro-financial assistance, i.e. with decisions taken by Parliament and the Member States, which is necessary "to enhance transparency, accountability, monitoring and reporting systems".
This aid should prompt Moldova to implement reforms under the EU-Moldova Action Plan agreed as part of the European Neighbourhood Policy. And MEPs want the Memorandum of Understanding and the Grant Agreement that the Commission will agree with the Moldovan authorities to be submitted not only to the Council but also to Parliament. 

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Moldova, Romania ready to ink political, border treaties

Moldova and Romania are preparing to sign a basic political treaty and a border delimitation treaty in the near future, Moldovan President Vladimir Voronin and Romanian President Traian Basescu said at a meeting in Chisinau on January 16. "A draft basic political treaty has already been drawn up, and it is necessary now to consider and sign it," Voronin said following the meeting. Voronin also said his Moldovan counterpart and he had discussed the signing of a border delimitation treaty between the two countries. "Moldova and Romania have inherited this border from the Soviet era, and, since it has not been changed, lawyers will have to consider possibly formalising these inheritance rights," Voronin said. Basescu also said he did not see the need to delimit the borders anew. "What is more important is not the border issue itself, but the way in which the border is crossed," he said.

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