Creditworthiness: Will Russia Take Risks and Offer Moldova 200 Million Euros Again?

Anton SHVETS They consider the Russian loan a settled issue in Moldova. Perhaps this is true and Moscow is now looking for the best moment to maximize the political effect of its financial assistance. The presidential elections in Moldova are rapidly approaching the moment of truth. The composition of applicants is practically formed, the two main contenders’ registration for the post of Supreme Commander-in-Chief Igor Dodon and Maia Sandu is a matter of just a few days. A series of steps should be expected from influential external players taking part in the Moldovan “glade” afterwards. They will be aimed at supporting this or that candidate, consolidating the electorate and achieving their geopolitical goals in Eastern Europe through the Moldovan elections. Taking into account the specifics of the Moldovan political process and the objective problems in the Moldovan economy caused by the COVID-19 pandemic together with the accompanying leeks, the financial aspect will become one of the dominant ones in terms of answering the question “who is who in Moldovan politics”. Over the past 10 years, the intensity and volume of monetary resources attracted from abroad have become this or that government’s success measure for “handshaking” in Washington, Brussels or Moscow and a standard, main source of positive injections into public opinion. Grants and donations determined the political process in Moldova alike its goals, budget specifics and all the accompanying rhetoric. In this sense, the newly and actively discussed allocation of the 200 million Euros Russian loan is Moscow's clearest way to convince the Moldovan electorate that Russia and President Vladimir Putin continue to support the people of Moldova and incumbent leader Igor Dodon, thereby consolidating pro-Russian voters ahead of the November vote. And not only in Moldova, but also in Russia itself: the current president is clearly counting on a vaster diaspora voting in Russia than before. Thus, the credit issue has long transformed from financial and economic to the political plane (as is often the case with Russia helping the post-Soviet republics). The effectiveness of such a support has always raised questions but one should not deny the benefits this step on the short pre-election period either. Undoubtedly, Moscow has more than once or twice faced the situation when its generously given money naturally “went down the drain”. This happened with the $ 3 billion loan issued by the Kremlin to Viktor Yanukovych at the end of his rule, not long before the "revolution of dignity." News about the way the Kremlin forgives multibillion-dollar debts to Cuba, Venezuela or another African country also appears with enviable consistency. Yesterday's Sochi talks between Vladimir Putin and Alexander Lukashenko led to a $ 1.5 billion allocation agreement of credit assistance to Minsk, once again demonstrating Moscow's willingness to be generous in financial support for its few partners in the world arena. The issues raised by the right-wing Moldovan political flank, and the subsequent proceedings in the Constitutional Court of the Republic of Moldova over the agreement on the Russian loan, became an unpleasant surprise and a serious obstacle for the Russian loan. However, Russia does not intend abandoning its main partner in Moldova at the finish line of the presidential race and is more likely to take risks again. It is oddly enough, but the bureaucratic side of the issue can help Chisinau, because if funds allocation is provided from the Russian budget, then it will be easier giving this money without reliable guarantees than justifying it remaining unspent. Perhaps this is one of the reasons, the camp of socialists is so confident it will finally receive the 200 million when talking about credit as of a settled issue. It is of a secondary question to what extent is this amount essential for the chronically poor Moldovan economy to recover. Of a much importance is the political and symbolic meaning of the Russian loan. So it is the effect to be produced both on Moldovan voters and on political forces in the Republic of Moldova who will no longer be able to demand the loan agreement withdrawing on a formal occasion and will be forced to either accept or actually admit their unwillingness to help improve the lives of their own citizens. The mere zugzwang possibility for the right-wing is becoming an additional impetus for the authorities to try reintroduce Russian money into the country to support the economy, infrastructure and social services. Thus, the credit issue is today exclusively awaiting for the most appropriate moment. Moreover, the Credit Detective’s second episode may entail another sharp opposition’s reaction with negative electoral consequences for it in the current situation. It is unlikely that an ordinary country resident will like to once again feel hostage to other people's showdowns.