Two Months of Tofan: The PR Show Goes On

The rise to power of a self-declared radical and advocate of painful reforms as the fastest path to economic development was met with anxiety and apprehension. His initial cautious steps were therefore received with a degree of public goodwill. However, after two months of tightening the fiscal screws on citizens and businesses, against the backdrop of the rising cost of living in the country, Tofan’s initial pledges are increasingly being brought back to mind. The main criticism now is the almost complete absence of measures to reduce the costs of the state apparatus. The main thing Moldova’s own Milei, as Tofan was dubbed several months ago, is doing for now is expanding the tax base at the expense of ordinary citizens and businesses. VAT on energy supplies, coupled with a drastic reduction in subsidies; VAT on the delivery of parcels from foreign online marketplaces, together with a special fee; and VAT on the activities of entrepreneurs from the country’s eastern districts. A separate and particularly painful issue is the “standardization” of VAT at a single rate of 20%. While the prime minister did backtrack on some women’s hygiene products, he has not done so with the rest of the product categories or entire sectors of the economy. In short, the promised decisive measures to cut budget spending and increase revenue are so far being implemented solely at the expense of the population. Take, for example, the additional millions in profits from rising prices on imported petroleum products, even at the current VAT rate. Or the decision not to seek aid from the European Union to subsidize residents’ utility bills for energy. We will not delve into the specific areas that were to receive the 837 million lei in grant funding that disappeared from the revenue side of the budget, prompting, among other things, the need to revise the budget. After all, one way or another, any external assistance, even from our strategic partners, is always conditional on certain political or economic requirements. Why would the authorities voluntarily hand over an additional instrument of pressure when making sovereign decisions? This logic applies to any country, but apparently not to Moldova. In our case, our partners in Brussels simply made “pointblank refusal”. What is still nowhere to be seen in the government’s work, however, is any sign of efforts to cut spending on the bureaucratic apparatus. Three weeks ago, Vasile Tofan’s PR machine rolled out a high-profile announcement of his “firm determination” to see through the reduction in the number of civil servants. By September 22, a plan is even supposed to be presented providing for the streamlining, merger, or abolition of government institutions. Over the past few weeks, however, no clear statements have followed regarding exactly who will be laid off or how the cuts will be implemented. There have been hints at the excessive zeal of certain regulatory bodies and agencies, while simultaneously justifying the functions and staffing levels of central government bodies. This already suggests that there will be no “guillotine” for the bureaucratic class. Moreover, the figures in the revised budget for the current year explicitly provide for an increase in spending on wages and other items in the public sector. Let’s recall the government program the prime ministerial candidate presented to parliament in connection with the vote of confidence. It included five key priorities, the most important of which was restarting the economy. The plan was to achieve this ambitious goal by reducing bureaucracy, implementing tax reforms to stimulate investment, developing industry, and supporting exports. The program’s very title, “A European Economy, an Efficient State”, also directly links economic development to improving the efficiency of the government apparatus. Of all the measures on this list, only tax reform is currently underway. An interesting question arises: how is this affecting the economy? Overall, the country’s investment attractiveness is showing no obvious signs of improvement so far. With rising energy prices, negative migration trends (Asian workers in Chisinau do not count), the continued practice of putting pressure on big business, as illustrated, among other things, by the situation involving FlyOne, and growing uncertainty in the security sphere, including the militarization and alarmist rhetoric of the authorities, achieving any positive change will be extremely difficult. And with the tax burden on businesses increasing, the result could well be the opposite. At the same time, objective foreign trade data do not yet support the conclusion that foreign trade as a whole has declined. According to the National Bureau of Statistics, in the first half of 2026, imports rose by 6.5% and exports by 12.5% compared to the same period last year. However, this export growth comes against the backdrop of a comparable and consistent decline in indicators in 2023 and 2024. Consequently, the projected recovery in economic activity in the first half of the year failed to materialize, which amid the ongoing tax reform will only exacerbate the situation in the second half of the year. If the government came to power promising an accelerated economic recovery, then two months in, we would like to see not only an expansion of the fiscal burden but also the first measurable signs of improvement in the investment climate, industrial production, business activity, and a reduction in administrative costs. And what is our prime minister doing in the meantime? The PR activity of the country’s formally most influential political figure shows no signs of slowing down. Even reshuffles and the return of officials to key government posts are accompanied by carefully crafted comments designed to bolster his image as a reformer and sustain hopes for positive change. It is well known that our audience responds better to, and more readily absorbs, emotionally charged political messaging. Tofan’s political strategists are squeezing every last drop out of this approach. Indeed, we are not even talking about the appointment of new people, but rather the transfer from one institution to another of some of the “most effective” and even scandal-tainted managers, who are supposedly expected to demonstrate greater efficiency in their new positions. This includes the transfer of Elena Tibirna from her position as director of the National Office for Social Insurance to head the State Tax Service; the appointment of Ion Dodon, head of the National Health Insurance Company, as director of the Public Property Agency; and the return of former Democratic Party member Radu Musteata to a senior position at the Agency for Intervention and Payments in Agriculture. The latter case, in particular, is especially telling. Vasile Tofan effectively dismisses his own admission that he made a mistake in selecting for his team someone who was either a liar or simply confused in his testimony. This reappointment inevitably raises questions about the consistency of the prime minister’s own personnel policy. It is quite possible that, in his view, where running a state is no different from managing a joint-stock company, even such unconventional moves can help increase competition and managerial efficiency while also generating some much-needed PR. The main problem with such a system is that, in practice, the shareholders and beneficiaries of JSC “Republic of Moldova” are not its population, but a narrow circle of government officials and businesses affiliated with them. Ordinary citizens are reduced to nothing more than powerless employees who long ago lost their right to a stake in the company. This is precisely why, two months after Tofan came to power, people are increasingly asking: when will the personal PR be followed by measurable results from the reforms that society was asked to accept in exchange for painful changes? If an efficient state apparatus was promised, what is needed are not merely vague plans to downsize it, but concrete steps. If an economic reboot was promised, what is needed are not just new taxes, but investment, industrial growth, and higher productivity. Ultimately, effectiveness should be measured not by the number of high-profile statements about reforms, but by concrete indicators, and at present, those indicators are deeply discouraging.