What’s Wrong with the Western Aid to Moldova

Anton ŠVEC

One billion Western funds are spent annually in Moldova without any relief for the socio-economic situation of the country

The current government is dependent on the Western community, which is ready to actively spend taxpayers’ money to support the regime that symbolizes an anti-Russian course. The figures on the official website of the European External Action Service show that Brussels has allocated 1.09 billion euros to Moldova in the form of grants and loans since October 2021. These statistics do not mention the results of the regular donors’ conference that ended on 17 September in Chisinau. According to the media, the 60 states and international organizations that participated in the conference allocated additional 305 million euros. An elementary content analysis of public reports on the results of five meetings of the Moldova Support Platform allows us to conclude that the amount of foreign injections only through this line since 2022 when the first summit of the platform took place has overcome the psychological threshold of 2 billion euros. And this is only in 2.5 years. Meanwhile, the instrument launched by Bucharest and supported by Paris and Berlin is by no means the only way of financing Moldova under the PAS. This overlooks the aid of a number of international structures, such as the World Bank or the International Monetary Fund, with which there are long-term relations under separate agreements. The US monetary support is a separate item. For instance, during the visit to Moldova in May, the US Secretary of State announced the allocation of 135 million US dollars - 50 for judicial reforms and 85 to solve problems in the energy sector (i.e. to overcome energy dependence on Russia). China, Turkey and Japan have also provided humanitarian aid in recent years. We can also recall a kind of military lend-lease in the form of supplies of equipment, weapons and uniforms, as well as training and direct funding from some states or the European Peace Facility. Of course, much of the above money (totaling about €3 billion over 3 years) has been provided as borrowed funds. This means both that future generations will be paying for the wastefulness of the PAS government for many decades to come and that already today substantial donor and budgetary funds are being withdrawn from the economy to service the external debt. In addition, a notable share of funds, primarily those raised during the recent support platform conference, have not yet reached the country. However, the government and parliament are already, warning that not a single penny of the 305 million euros will be spent to normalize the disastrous situation in the agricultural sector, which has resulted in renewed farmer protests. Nobody is in a hurry to cover the government’s debts on salaries of the employees of the state enterprise Moldova Railway either, although the amount of 150 million lei does not seem large in comparison with the appealing donor funds. As it turns out, even without including debts and deferred financing, the government cannot utilize the full amount of credit and grant resources. Recently, the head of the EU Delegation to Moldova, Janis Mazeiks, said that EU donor aid is used, among other things, to pay the salaries of numerous European emissaries employed by EU state bodies and organizations in Moldova. The Frontex mission was cited as an example, but we also have EUBAM, the European Centre for Migration and Border Management, and at least one high-level EU advisor assigned to each ministry and agency. In such a configuration, Brussels’ expenses for the labor of external managers of our country may amount to several or even about 10 million euros annually, but they are presented as external “assistance” to Moldova. Nevertheless, the West indeed sends huge amounts of funds to our republic at this stage, amounting to 1 billion euros annually, in exchange for loyalty. The problem is that the current authorities are unable to effectively manage these resources, creating prerequisites for economic growth, boosting industrial production and international trade, increasing salaries and social benefits, as well as the much-needed return of migrant workers. Instead, the money not provided for economic development provokes inflation and is spent on election campaigning, opening diplomatic missions and increasing the salaries of top officials. In addition, some of the “laundered” foreign funds are embezzled on infrastructure projects of dubious expediency. 10 years ago Moldova was dumbstruck by the scandal on the theft of a billion from the banking system. Despite the enormous uproar, the embezzlement of these funds had little impact on the lives of ordinary citizens, but the political effect was huge. Today, it turns out that this phantom money is not so easy to find, not to mention its return to the domestic banking sector. At the weekend, the prosecutor general admitted that a series of promotions and dismissals in his department (including the notorious reform of justice with non-functional commissions of vetting and pre-vetting) have suspended the investigation into the theft of the billion, and relevant prosecutors are no longer in charge of it. It seems that this money will never be found, and the PAS regime is tired of searching for it – the scandal allowed to solve a political task and formulate bright slogans for Maia Sandu, now this topic can be safely closed and forgotten. As of today, it is not clear where and for what purpose Moldova spends one billion Western funds annually. At the same time, the economic situation continues to deteriorate and the crisis in the social sphere threatens protests even if the incumbent team succeeds in the upcoming presidential and parliamentary elections. At the same time, the “burden of political loyalty” to Washington and Brussels in exchange for the received resources (deferrals and restructuring of loans will very soon turn into an additional instrument of control of Moldova’s sovereignty by the West, and under any government that is not interested in default) is becoming increasingly inevitable and irresistible. The prospects for such a state, financially supported and politically controlled, are very bleak, even tragic, but, as PAS would say, absolutely European.