Moldova on the Brink of Transport Collapse

The government is steadfast in destroying the country’s unique transit potential through corruption, managerial flaws and conflictual foreign policy

Anton ŠVEC, RTA: The ruling regime and the opposition continue to argue ideologically about whether Moldova will become a “bridge” between East and West, and whether it is necessary to strengthen the transit potential at all, or whether it is enough to ensure a high level of transport connectivity with the European Union (read Romania) and not to worry about infrastructure and businesses that cannot be integrated into the new scheme. The course is set on the development of mobility, including military mobility, modernization of public roads and other transport facilities, including airports, at the level of strategic documents and declarations. De facto Moldova, for objective and subjective reasons, is systematically losing its transport market position, as the government is not only unable to implement modern projects, but is actively wasting the potential built up in previous decades. Last February was marked by an intense conflict between the PAS regime and association of road hauler employers. On 15 February, APOTA held a rally in the center of Chisinau, and later in the month transport companies suspended district and intercity carriages for three days. The then Minister of Infrastructure Andrei Spinu threatened the association with harsh reactions in response to accusations of promoting illegal schemes and squeezing out of the market, as well as demands for liberalization and harmonization of legislation and transport programmes with the EU. The conflict was temporarily extinguished, but even after Spinu’s resignation in November, the causes of the carriers’ discontent were not eliminated. On the contrary, APOTA sent an open letter to Prime Minister Dorin Recean in March this year accusing the Ministry of Infrastructure and Regional Development of corruption and threatening to resume protests. Transport workers complain about the lack of a methodology for setting regular transport tariffs (promised by last summer) and the arbitrariness of the national road transport agency, the unmotivated closure of routes and unenforceable requirements for the use of speed meters, tachographs and electronic GPS, which may lead to the violation of citizens’ rights, and criticize Minister Vladimir Bolea: “The Minister continues to support absurd regulations that both do not solve the problem and entail corruption schemes”. On 25 March, the situation in the road transport sector sharply deteriorated for Moldovan companies. The Russian government adopted a decree establishing a ban on international road transport of goods on the territory of the Russian Federation by vehicles registered in the Republic of Moldova, in fact cutting off Moldovan suppliers and transport firms from the Russian market. Obviously, this political measure was a consequence of unfriendly steps of the PAS regime towards Moscow and this spat will hardly be overcome promptly amid the scandal with another expulsion of three diplomats of the Russian embassy in Chisinau. The adoption of the decree will be a disaster that will exacerbate the mistrust between the country’s authorities and transport companies for the Moldovan freight transport sector, which has benefited greatly from operating in sanctioned Russia, delivering goods from various EU countries. The accumulated protest potential will be difficult to cope with, especially if the railway problems continue to be ignored. The new replacement of the interim head of the state-owned enterprise in no way contributed to the issue of wage arrears. Moreover, modernization or reform (with division of assets) of the sector is absolutely delayed. PAS does not understand what they have to do with the railway system when transit through Ukraine is stopped and Kyiv itself is not in a hurry to use the services of SE Moldova Railway for export deliveries. The fact that industrial enterprises on the left bank of the Dniester are idle for a whole quarter does not contribute to an increase in transport volumes either. As a result, the railway has become a facility that requires enormous capital investments to restart and a source of constant political problems. PAS has even stopped its efforts to normalize the situation at the enterprise, as it does not see its electorate among Moldova Railway staff, which is predominantly Russian-speaking and quite embittered by wage debts. Probably, there are plans to allow privatization of the most promising parts of the asset by foreign (Romanian) capital just after the parliamentary elections. Meanwhile, the government is paying greater attention to airports, but the state of affairs remains deplorable. Ten or even five years ago, Chisinau airport generated substantial profits, being an air harbor with many destinations, including connections, and a well-developed duty-free network. Now the facility is in a unique position, as it is actively used by citizens of Ukraine whose airspace remains closed to civil flights. However, the government has failed to attract major airlines and key low-cost carriers to cooperate. Moreover, sanctions against Russian airlines and tour operators are also hindering the development. The issue of commercial space at the airport after its transfer to state control is marked by endless scandals, when the existing enterprises cease their activities and it is impossible to restart the processes with profit. Today, Moldova’s state-owned airlines are virtually liquidated, pilot training is poorly aligned with international standards, and the airport itself is in the worst position in terms of quality of service and revenue in the last 15 years, not to mention constantly rising ticket costs. Under these circumstances, the government decides to reallocate part of the Chisinau airport’s profits to modernize the infrastructure of the air harbor in Marculesti. It’s a purely reputational decision (two operating airports in the country), but irrational, given the inability to manage one facility and the increased competition. For many years, the transport sector has been strategic asset for Moldova, providing budget revenues and economic needs, as well as profits for many individuals involved in this type of activity and often affiliated with the state. However, during the 5 years of PAS rule, the sector has virtually been ruined, becoming partly unprofitable and absolutely scandalous. Although it still generates income for certain businessmen, which is quite in line with the standard logic of the ruling regime - to make money now, and integration into the European Union will solve it later.