Why Is Moldova on the Brink of a Perfect Storm?

The one-dimensional policies of Maia Sandu and the PAS have severely limited Moldova’s ability to withstand crises, with their number now approaching a critical threshold

August is generally considered the quietest month of the year in Europe: parliaments are in recess, it is the holiday season, and domestic politics tends to slow down. In Moldova, however, the situation is quite the opposite. While public attention is focused on minor issues, several negative developments are converging at once. If they do, the republic may face a crisis on a scale of the pandemic, or even worse. The root of the problem lies less in the number or severity of the looming risks than in the fact that the current model of governance has all but stripped the country of any ability to manoeuvre in an unstable regional and global environment. In recent years, we have been firmly embedded into a system where any external turmoil automatically triggers internal upheaval. The first cause for concern is the situation on the Dniester. The summer low-water period has long since ceased to be merely an environmental issue, as it directly affects the water supplies to the country’s largest cities, particularly Chișinău, as well as the operation of numerous infrastructure facilities and economic sectors. This year the situation is compounded by the shallowing of the Danube, which is creating a major regional challenge that affects Ukraine, Romania and the entire Northern Black Sea basin. This is primarily due to the fact that water shortages are beginning to affect the energy sector as well, disrupting the operation of critical infrastructure, including facilities that ensure the stability of the entire system. Reports of possible energy-saving measures in Romania are indeed highly concerning. When our largest energy partner begins preparing for restrictions in advance, it is a clear indication that the risks are being taken very seriously and that the consequences could prove, to put it mildly, extremely challenging. The situation is disastrous for Moldova. In recent years, our energy policy has been built around maximum integration with the Romanian market and exclusive reliance on Romanian suppliers. This approach has helped us move away from previous suppliers linked to Moscow and Tiraspol, but it has also created a new model of energy dependence. Needless to say, in a crisis situation, Bucharest will put the interests of its own consumers first. Meanwhile, the PAS has already burnt all its “old” bridges. This is an extremely dangerous combination, especially given the current state of the neighbouring country’s energy system. Preparations for the upcoming heating season are no less concerning. Global energy prices remain volatile, while European markets continue to respond to geopolitical developments, logistical changes and seasonal demand growth. According to publicly available data, gas storage levels across Europe are lagging behind schedule, as many countries are likely to be looking for the most commercially viable options. Under the current regime, each new heating season in Moldova becomes a test of the government’s ability to keep tariffs within acceptable limits. Yet tariffs are already being revised, preparing the public for another increase in heating and electricity costs. For citizens, this has almost become the norm, as virtually every energy crisis in recent years has ended the same way – with a higher cost of living. All this is taking place against the backdrop of another negative indicator relating to the state budget’s performance in the first half of the year. The deficit’s roughly 20% increase and the reduced volume of external grants indicate that the previous financial model is beginning to face serious constraints. Whereas a significant share of expenditure was previously covered by external funding, the number of donors willing to sustain our financial and economic system is now declining. The overall situation is further complicated by external factors, including the ongoing war in Ukraine, whose impact is increasingly being felt far beyond the front line. Reports of further damage to transport infrastructure in the Zatoka area are a stark reminder of the vulnerability of regional logistics routes. Even if such incidents do not directly affect Moldova’s territory, they can still disrupt deliveries, drive up transport costs and intensify competition with Ukraine for limited transport and energy resources. The government’s increasingly active foreign policy also suggests it is bracing for another crisis. With budgetary, energy and infrastructure risks mounting, the authorities appear to be securing potential sources of external support in advance. Their intensified contacts with Bucharest and Kyiv are particularly telling, underscoring the seriousness of the situation. That said, there are legitimate questions about our partners’ actual capacity to provide meaningful support. With Romania preparing to curb energy consumption and Ukraine continuing to endure wartime conditions, we can hardly expect substantial assistance. This exposes the main weakness of PAS’s model of governance in Moldova – its heavy reliance on the stability and capacity of neighbouring countries. When all face difficulties at the same time, the mechanism of mutual support is bound to become far less effective, or even give way to the every-man-for-himself principle. A country’s ability to withstand crises largely depends on the range of available options to respond, and this is precisely what Moldova lacks today. We have significantly restructured the architecture of our economic and energy ties, yet, as experience has shown, this has brought no fundamental change. Real diversification means having a range of strategic options, not simply replacing one dependency with another. The state is clearly unable to return to normal functioning between successive crises. Each new crisis requires emergency measures that provide only a temporary relief without addressing the underlying causes. If worsening water shortages, rising tariffs, budgetary constraints and tensions in the energy market converge in the coming weeks, Moldova could face a perfect storm. Of course, none of these problems can be attributed personally to the current cabinet, which has been in office for barely two weeks. It would be easy to blame each of them on the weather, the war in a neighbouring country or global prices, yet they all share a common denominator. In less than five years, Maia Sandu’s and PAS’s government, which promised integration and stability, has failed to secure any source of water, gas, electricity or budgetary funds, truly independent on the goodwill of others. This is precisely why many see the current situation as the inevitable consequence of long-standing systemic problems rooted in the ruling group’s lack of a coherent strategic vision. What better reason could there be to seriously consider whether the ground has been laid for an early shift in the country’s model of governance?