USAID Collapse. Implications for Moldova

Sergiu CEBAN

The freezing of USAID projects and the monetary “dehydration” of the extensive network that kept Moldova firmly on the Western course will seriously damage the positions of PAS and Maia Sandu, and in the long run may lead to serious changes in our society and politics          

In 2022, the United States Agency for International Development (USAID) celebrated the 30th anniversary of its activity in Moldova. According to Americans’ estimates, over three decades, our country has received about $700 million dollars from the US government through this organization spent on more than 130 projects. Obviously, such a lavish source of money would have continued to expand in the foreseeable future had it not been for the return of Donald Trump to the White House. One of his first acts in office was, in fact, to declare war on this federal agency. As of today, Trump’s package of decisions against USAID (albeit some of which have been partially overturned by the judiciary) makes it predictable that it will eventually cease to exist in its usual form. The most obvious consequence of this will be that the US extensive network of influence in various regions and countries of the world, which was largely supported through the agency’s programmers and projects, will be called into question. Moldova was clearly one of the major consumers of American money: Washington’s investments were significant. It is not accidental that after Trump’s decree to suspend international funding for 90 days, a wave of indignation spread, including in our country. Just the other day reports came that the total USAID budget for the maintenance of our non-governmental organizations is about $90 million. Most likely, this is just a small part of the long-term foreign efforts to establish influence on the government bodies and political institutions, securing a stable and strong U.S. presence in our country. In fact, USAID activities in Moldova are much broader and more inclusive than the average citizen of the republic can imagine, so let us try to reveal some details. The main declared areas of work are related to the development of democracy and market relations, the fight against corruption, and direct assistance to the public and private sectors. At the same time, the agency was the most active, if we compare it with its other American colleagues pursuing largely similar goals. Money flows accumulate in mainstream programmes, which are further divided into several types of projects and are implemented by governmental organizations, the non-governmental sector, and small groups of activists and influencers.  Let us take a few such programmes as an example: - Building Social Cohesion, planned for 2022-2026. It is implemented by the American company Management Systems International. The main goals are to increase supporters of European integration and democratic reform processes, and to unite Moldovan citizens around a common European identity. For this purpose, grants were provided to public associations and local mass media. By the way, there was a separate $11 million project for the latter, which was used to “feed” such prominent media as Newsmaker, Ziarul de Gardă, RISE Moldova and others. - Financial Sector Transparency Activity (FSTA), with an implementation period from 2019 to 2024 and a budget of $9.5 million. It was designed to enhance transparency in the activities of government agencies and increase public trust in oversight bodies. According to some reports, the programme was planned to be extended for the next five years, but under the new circumstances, its future looks uncertain. - Supporting Entrepreneurship Education in Europe and Eurasia. 2017-2026, $1.2 million. Consists of educational programmes for schoolchildren and students that are designed to build partnerships with local and national authorities, NGOs, community groups and private sector enterprises. - Future Technology Activity (FTA). 2021-2026, over $52 million. This programme aims to improve the competitive ability and increase the integration into the global market of transformative economic sectors in Moldova. It is about information and communication technologies, mechanical engineering, light industry, creative industries and digital media. - Moldova Institutional and Structural Reforms Activity. It was planned to be implemented in the period from 2022 to 2027, spending 35 million dollars. The main objective was to stimulate reforms in the economic sector. Another programme - Rural Competitiveness and Resilience Activity, for which about fifty million dollars was allocated, was envisaged for the same period. It is aimed at the agriculture and tourism development, which should contribute to building the capacity of the country’s agricultural sector for export to the European Union. USAID work in the energy sector is of particular interest, especially today. The government’s policy of rejecting Russian gas supplies has led to a sharp increase in energy prices and tariffs. To support the regime’s geopolitically advantageous policies, the U.S. has started assistance through the Development Finance Corporation (DFC) programme, which runs until 2029 and is designed to support energy lending. In addition, the Moldova Energy Security Activity (MESA) programme, which although intended for a shorter period of time, from 2022 to 2026, includes nearly $60 million in funding to deepen the integration of Moldova’s and Europe’s energy systems. Moreover, under the agreement signed on 30 June 2023, the U.S., through USAID, was to donate $300 million to us to promote democracy, civil society, independent media, and reinforce the energy sector that is not reliant on Russia. Of course, these are by no means all the programmes that the United States implements in Moldova, but they form the bulk of USAID project activities in Moldova. In general, the operation of the American agency all these years has been aimed at forming mechanisms of US influence, smooth transformation of attitudes in Moldovan society and in political institutions of power for consistent inclusion of our country in the sphere of the Western influence. Having assessed the activities of one of the largest American instruments of global influence, one can judge the depth of external penetration into the structure of our state and society. Over three decades, we have developed an entire estate with its own stable ties in the United States, its own set of rules that go against the current legislation and the interests of the country, its own leaders and mechanisms for influencing the authorities. Unlike other socio-political groups, this grant social stratum has its own set of privileges, special immunity and the right to interfere in many matters of national importance. The last ten years have seen the most active incorporation of this class into the system of state governance and, eventually, it became one of the largest ruling groups, displacing other political projects and parties. The freezing of USAID projects and the cutting off of large resource flows to support the extensive network that kept Moldova on a Western course will certainly harm the positions of PAS and Maia Sandu, especially in the run-up to the crucial parliamentary elections. Probably, there will be enough reserves to maintain all this network infrastructure for the next month, maybe two. But we doubt very much that Brussels will make up for this loss of external support. If the U.S. really decides to cut its spending, it could involve structural changes in our society and politics.