“Money on Air”: Why Inflate Moldova’s Military Budget

Vladimir ROTARI

The defense spending budgeted for 2023 increased again, by almost 70% compared with the previous year. The military explains this increase by the additional spending on the protection of the country’s airspace. But it seems to be not the only reason

Course on defense The main financial document of the country for the next year was adopted in conditions of obvious rush. The government approved the draft budget virtually without review, after which it was voted on in Parliament in two readings without unnecessary discussion. As Finance Minister Dumitru Budianschi said, the budget was prepared “taking into account the war in Ukraine, existing threats and hybrid warfare.” Proceeding from such estimates, it is not a surprise that defense expenses turned out to be one of the most “increased” items of expenses – they increased at once by 68% in comparison with 2022. Reportedly, an additional 650 million lei will be spent on air defense. Basically, throughout the year the ruling party promoted several simple ideas, justifying in advance the increase in its own military expenditures and also explaining the significantly increased investments of development partners in the National Army. For example, that neutrality must be backed by force. “We must understand that it is necessary to invest in defense. A neutral country cannot be called neutral if it does not have a strong defense,” PAS deputy Radu Marian said on this point. Or that in the context of the Russian-Ukrainian conflict, it is no longer possible to save on the army. “After years of neglect, we are finally investing in defense, especially in the context of the Russian invasion of Ukraine. A strong country means a strong and respected army,” said the same Marian. It is safe to say that the trend of giving increased “signs of attention” to the armed forces is a long-term one. Secretary of the Supreme Security Council Dorin Recean confirms that the country will continue to buy and donate as many lethal weapons as it can, because “it wants to build a state with strong defense and contribution to regional security.” The same conclusion follows from Defense Minister Anatoly Nosatoy, who on the one hand welcomes the increase in military spending, but on the other regularly declares that it still does not meet modern needs. “We welcome the increase in funding for the army and the attention to this issue. This is important until we decide in the next few years what our future will be: whether we will stay on with the status of neutrality or the citizens will choose another path. But even as a neutral country, we need a substantial increase in defense spending, so that it reaches 2% of GDP and such funding was for 5-6 years, in order to have tangible changes,” told the Minister at the conference Moldova Debate Forum. Leaky budget And this is amid all the economic problems of the country, when it is impossible not only to increase spending on priority socio-economic items, but even to finance them at the level of inflation. It is especially evident in next year’s budget, which the opposition has already called “the budget of poverty”. This is not just a political technology ploy – experts are also predicting an increase in the share of poor people in 2023. In addition, the document is drawn up with a gigantic deficit of more than 18 billion lei. It is planned to compensate for it mainly at the expense of foreign aid and borrowings, including domestic, on which the interest rate has already broken all records. That is, in fact, there is no question of any development – the population will continue to become poorer, the state will have even more trouble to fulfill its social obligations (and some of them it can’t even carry out anymore: for example, to index the wages of state employees taking into account inflation). Let’s add compensations to the population (the need for which is often associated with the ruling regime’s not the most far-sighted policy), which eat up more and more resources. Yes, if you look at the absolute figures, defense spending is not the largest item of expenditure. But, on the other hand, it has grown the most. And this meteoric rise amid all the described budget problems1 raises a lot of questions-at the end of the day, tens of millions of dollars could have been spent on more socially sensitive items. The more so since, as the Defense Ministry admits, we will get the missile defense components bought with this money in a year or so, at the earliest. So, it is in 2023 that we are literally spending $650 million “on air”. More to “NATO’s” 2% At the same time, even billion-dollar budgets, which the military had never operated with before this year, are not very satisfactory to the Defense Ministry. According to Nosatii, it is only 0.55% of the GDP, which is not enough, so we have to gradually go to 2% (more than 5 billion lei according to current figures). The explanations of the Defense Ministry sound nice, but even a superficial analysis raises questions. The first is why they decided to spend so much money next year exactly on the air defence. It is clear that the formal reason is falling missile debris and their unauthorized flights through our territory. But the practical result from this expensive purchase will be minimal by our standards – one radar won’t protect us from missiles, and we still cannot afford to organize a full-fledged missile defense. Here either we are just sort of returning the money to our partners by buying equipment that is not particularly necessary, or they have some interesting plans about the role of our territory in the region’s collective security system in the near future. The second is the very 2% of GDP that should be spent on defense, according to our relevant officials. We are explained that neutrality implies a strong army and even greater investments in “defense” than in conventional countries. However, European practice does not say anything of the kind. Neutral Switzerland and Austria had military spending well below even one percent until recent years. Only now, in the context of the continental crisis, are the ruling forces there pushing to increase it – but still not to the same proportions as with us. Not to mention the level of socio-economic well-being and budgetary stability in these countries, which makes it possible to “fork out” a little more money on the military sector without too much trouble. The simplest and most logical explanation is that the figure was taken from the well-known NATO standard (which, by the way, most members of the Alliance do not follow – something Donald Trump argued strongly with the Europeans about in his time). It is not at all difficult to imagine why it has become so closely associated with our minister, who has become a regular guest at various NATO events. But what is the long-term motive? Is it really about gradually preparing the country for a closer cooperation with the bloc, or, who knows, even full integration, and not only within the traditional IPAP? After all, Anatolie Nosatii reasoned that the neutral status of the country may soon change. There are enough hints without it. Besides, joining NATO can happen not separately but parallel to the unirea, the process of its registration is going on in the background, so to speak, and it can “work out” at any minute. Then, probably, it will be very convenient that Moldova will already have a military contingent prepared according to the NATO standards, and all the necessary weapons, and even elements of the missile defense system.