Why it’s essential for the EU to continue providing financial support to Moldova

The effects of the Russian war in Ukraine, not least a massive influx of refugees, might bring Moldova – a country already struggling with the pandemic and a gas crisis – to its knees. The EU has begun providing macro-financial support and such efforts must continue, says Markéta Gregorová.
Ukrainian refugees arriving at the village of Palanca on the Moldovan-Ukrainian border in March 2022. Photo: Alamy

By Markéta Gregorová

Markéta Gregorová (CZ, Greens/EFA) is the standing rapporteur on the Eastern Partnership for the Committee on International Trade

31 May 2022

When the European Parliament approved €150m in macro-financial support to Moldova in March, those funds were aimed at helping to solve the impact of the Covid-19 pandemic, advancing resilience, recovery and reforms, and helping with a gas crisis caused by a dispute with Gazprom. Unfortunately, even before the plenary vote, this number turned out to be quite insufficient due to the war of aggression in Ukraine.

UN Human Rights in Moldova estimates that from the beginning of the war to mid-April, 421,130 refugees had fled to Moldova, with 101,331 of those deciding to stay. This might not seem like a high number in comparison to other countries. However, we must consider that Moldova has a population of only 2.59 million, meaning the country has received the most refugees in per capita terms.

In combination with other effects of the Russian war of aggression, such as increased energy prices, disruption of export and import routes, disruption of food markets and rising commodity prices, the influx of refugees might bring Moldova to its knees.

In short, the Republic of Moldova needs help and aid. As its European partner, the EU should find ways to stabilise the economy and provide enough support to mitigate all the effects of the current situation. We must hope that the EU and others don’t take longer than Moldova can afford.

In April, Germany, France and Romania launched the Moldova Support Platform at the Ministerial Conference in Berlin, consisting of the EU Members States, G7 countries and her international partners and countries. As a result, €71m for humanitarian assistance and €695m in loans and grants were pledged to Moldova.

This amount exceeded the estimated €480m in external financing needs calculated by the Commission. At the beginning of May, European Commissioner for Neighbourhood and Enlargement Olivér Várhelyi finally announced the mobilisation of an additional €52m for the Republic of Moldova.

As their European partner, the EU should find ways to stabilise the economy and provide enough support to mitigate all the effects of the current situation

The project EU4Reforms will support the implementation of the EU-Moldova Association Agreement, particularly in good governance and strategic communication, to help in the fight against disinformation. And in the long term, the EU4Recovery and Resilience project will contribute to resilient, sustainable and inclusive economic development in Moldova, supporting the Green Agenda and SMEs to improve the business climate, trade facilitation, connectivity and human capital development.

The Commission should also explore opportunities to facilitate Moldovans’ labour access to the EU and reduce barriers to Moldovan exports into the EU. Additionally, the EU is providing €13m in humanitarian assistance and €15m to support the dignified and efficient processing of refugees and the secure transit and repatriation of third-country nationals.

The country certainly needs institutional reforms, such as improving decentralisation, crucial reforms concerning the institutional setup of the public administration, the de-politicisation of public anti-corruption institutions, and resilience against state capture. But it’s questionable how any country under these circumstances could manage significant reforms.

And since the Moldovan government has been eager to undertake necessary reforms so far, which has incredible potential for its future, it would be a shame to sink these efforts with the unfortunate chain of events that have had such a detrimental effect on its citizens.