ANALYSIS: The European path of Moldova: One step forward, two steps backwards?

And three questions to find our way through the maze.

By Victoria Onofreiciuc, former student at College of Europe

Victoria Onofreiciuc, Collège de Bruges

Victoria Onofreiciuc, College of Europe

Moldova has been one of the front-runners on the path of European Integration in 2012 or the “best pupil” in the eastern partners group according to EaP Index experts. In spite of that, Moldova risks losing this status after the recent events on the political scene in Chisinau. The vote of no-confidence received by the Moldovan Government was a surprise for the international and European communities, with all the relevant stakeholders still waiting for the consequences of this action. 

However, leaving all political issues behind, how will the signing of the Association Agreement influence the EU-Moldova framework and what will be the real benefits for the country following this highly awaited results?

1. The DCFTA: what does it really mean for Moldova? A chance for future trade or simply Making Concessions For The sake of Association with the EU?

For a small country as Moldova, which has a developing and quite fragile economy, increased and consolidated trade relations with an important partner as the EU is definitely “the cherry on the cake” in the process of European Integration. Taking into account the agricultural character of its economy, like wine production and animal breeding, the possibility for the Moldovan products to reach the European market would significantly contribute to the increase of local GDP. Thus, the on-going successful negotiations of a new trade agreement, the DCFTA, which will replace the existing ATP system, have been declared as vital to both the Moldovan public and for the general framework of EU-Moldova relations.

However, the local farmer in Moldova is definitely not aware of the more technical aspects of these trade negotiations, namely that fact that he could have already benefited from export possibilities to the EU under the ATP, should his products have corresponded to EU standards. Of course, the signing of the DCFTA will provide access for an unlimited period to the EU market, improving the business and investment environments and increasing the level of competitiveness and dispute settlement mechanism. However, the Moldovan products will still have to reach and correspond to the quality standards of the EU in order to be exported to the European “market heaven”.

Of course agriculture is one sensitive question for the European key-actors and this might have certain implications in the process of increasing the export to the EU, however, given the small-size of the Moldovan economy it might not pose serious threats for the European farmers.

As discussed with representatives from DG Trade, the importance of the DCFTA for Moldova has a lot to do with legal reforms and the harmonization of national laws with the European aquis, and maybe rather less with trade benefits as such. However, national GDP is expected to increase with 5.4%, exports with 16% and imports with 8% , according to representatives of the Moldovan mission to the EU in Brussels, thus consolidating the trade benefits from the DCFTA.

Indeed, the positive pace and eagerness with which Moldovans have been implementing these reforms is appreciated by the EU, however one should not forget the noticeable lack of expertise present in some negotiation chapters and the need to make a thorough change, rather than a quick one.

As such, the signing of the DCFTA is not being questioned by anyone; the tricky part will come with the implementation stage. Moreover, taking into account the fact that Moldova has fragile political and economic controls over an important part of its territory – the Transnistrian region, and as such the application of the DCFTA for the Transnistrian territory is being discussed.

As mentioned by several key actors in the process of negotiating, this will for sure become the big question mark in the stage of actual implementation of the DCFTA in Moldova.

2. Where does Moldova fit in the EU-Russia energy puzzle?

When someone thinks “EU, Moldova and energy” he for sure has to add Russia in this line of thought, otherwise it will lack logic and continuity. The energy issues between Moldova and the EU have always included the Russian element. Due to its geographic position and political-strategic location, Moldova had to face Russian influence and interference in any energy related discussions with its partners, especially with the EU.

The most recent conflict was related with the signing of the Third Energy Pack in the framework of the Energy Community. Given that the Russian Gazprom owns the Moldovan gas-transport system, this might cause issues according to the provisions of the Third energy pack which imply for a country to separate gas transit and domestic supply, with one company not being allowed to own both.

Russia has used a rather threatening tone in its line of speech in regards to the signing of the pack by Moldova, and the EU felt the need to intervene in a protective way, trying to offer all the support it could for Moldova in this complex situation.

Namely, the EU has proposed to delay the signing of the pack until 2020, which will give Moldova enough leverage time to prepare for all due reforms to be implemented and cool down the Russians in regards to this issue.

This solution seemed to calm the spirits for the moment, however according to expert opinions from the EU on this issue, the situation still remains largely unsolved, with important marks left in the entire framework of EU-Russia relations.

The main elements of concern seem to focus on the nature of the message sent out by the Russian part, which was perceived rather as a political than economic one, leaving room for the need to assesse the desired level of influence Russia would like to have in the context of EU actions towards its eastern partners.

This leads us to one of the trickiest subjects of EU-Moldova relations from the political point of view: the Transnistrian conflict. Especially in this time of rather positive developments in this framework, what is the exact impact that Transnistria can play in the context of EU-Moldova relations and are there any sure signs of settlement to be noticed in the near future?

3. The Transnistrian conflict: still there to be dealt with.

The Transnistrian issue was and continues to be one of the big question marks in the framework of any actions implemented in the context of EU-Moldova relations. Especially taking into account the role of “normative power” that the EU would like to play on the international arena, namely in regards to its Eastern partners, the Transnistrian settlement comes in as a highly desired prize to be won.

Unfortunately, this objective has proved rather difficult to achieve, regardless of the numerous actions implemented by the EU towards this goal. Lately one can notice a difference of opinion and of appreciations coming from the local actors and the European ones. While the EU declares itself to be rather pleased with the pace of negotiations in the “5+2 format” and focuses on confidence building measures between the population of Moldova and its Trasnistrian region, the representatives of the latter one seem to be rather unsatisfied with the progress achieved so far. Namely, the teachers from the Transnistrian schools where students are taught in Romanian have voiced big concerns in regards to the respect for human rights (c.f. the last UN Ruman Rights Report in the Transnistrian region of Moldova 2012) and dignity in the framework of a panel discussion organized in the European Parliament, invited by the Romanian EMP, Monica Macovei.

While representatives of the European External Action Service (EEAS) have noted improvements in the process of negotiations, with a specific attention drawn to the lack of need for the EU to apply sanctions towards Transnistria, the teachers themselves described a more serious situation which required immediate and assertive support from the European partners.

Thus this might lead one to conclude that there is a pronounced need for a more thorough co-operation with the local population in regards to concrete actions of support which might be implemented by the EU in the Transnistrian region of Moldova, however it might also happen that Transnistria will see the benefits of the association agreement and change its line of action towards the Republic of Moldova, wanting to integrate in order to be able to receive the advantages of the agreement.

In spite of the importance and success of the negotiation process between Moldova and the EU, the vote of no-confidence given by the Moldovan Parliament to the Government can have a negative influence on the signing of the Association Agreement, if the Moldovan authorities are not able to handle this situation with the due level of political maturity and responsibility. As mentioned by one of the MEPs, the European Union is still ready to offer full support to any actions implemented by Moldova on the path of European Integration. Actually, this is another crucial test for the young Moldovan democracy.

This analysis reflects author’s views only.

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