Yearbook 2008
Moldova. In March, after seven years as prime minister,
Vasile Tarlev was replaced by former Finance Minister
Zinaida Grecianii, who thus became M's first female head of
government. According to
Countryaah reports, Grecianii emphasized the importance of freedom
of the press, active dialogue with citizens and the
independence of the judiciary.
In April, Moldovas president and leader of the Transnistrian
breakaway republic met for the first time in seven years.
The meeting was held in Bender, Transnistria, where Vladimir
Voronin and Igor Smirnov agreed to resume the peace talks
that broke down in 2001. No date was set for the talks, but
President Voronin had previously declared his desire to
resolve the conflict before his second and final term 2009.
Russia has military in Transnistria. In connection with
Kosovo's independence at the beginning of the year, hopes
were raised in Transnistria that Russia would recognize the
breakaway republic as independent.
Moldova is regarded as Europe's poorest country with poor
public health, including widespread tuberculosis. About 4.5
million people have left Moldova to apply for work abroad, and
the money they send home accounts for more than a third of Moldova's GDP. More than half of emigrants are women and many have
fallen victim to human trafficking.
Heavy rainfall and flooding during the summer caused the
death of at least three people in Moldova's capital Chişinău,
where thousands of residents must be evacuated.
Following Russia's war against Georgia over the Georgian
outbreak republics of South Ossetia and Abkhazia, President
Voronin and Russian President Dmitry Medvedev met, who said
they had good hope of resolving the conflict around
Transnistria. At the same time, the Russian Duma voted for
Russia to recognize South Ossetia and Abkhazia as
independent states, which also happened. Transnistria, which
is also not recognized internationally, followed in the
footsteps of Moscow and recognized South Ossetia and
Abkhazia.
Transnistria Economy
Transnistria's economy is based on exports of industrial
goods, repatriated money from emigrated citizens and Russian
grants. The economic system is a mixture of Soviet command
economy and a relatively free market economy. There is also
considered to be a significant element of smuggling, but the
views fall apart as to how large that proportion is and
whether it is justified to describe the country as a mafia
state.
Industrial production is dominated by steel, electricity
and textiles. The domestic market is small and the companies
are heavily dependent on being able to export.
The largest individual company group is Sheriff, which is
the country's largest employer and owns, among other things,
chain stores, gas stations and a mobile operator. The Group
is estimated to account for half of all construction
operations in Transnistria and 90 per cent of oil and
gasoline sales. The sheriff is also the only major company
in the country that is basically run according to the rules
of a free market. It receives no state support but was
exempted until 2012 from certain customs duties. During Igor
Smirnov's regime from 1990–2011 (see History), the Sheriff
had a privileged special position that gave the Group the
right to freely manage foreign currency, which could, for
example, be transferred to low-tax countries. These
privileges were abolished by the new President Yevgeny
Shevchuk.
The Transnistrian economy is still strongly intertwined
with the official Moldovan economy, which means that all
Transnistrian export goods are labeled as manufactured in
Moldova. Transnistrian companies wishing to export their
goods legally must register with a court in Chișinău,
Moldova's capital.
Since Transnistria is not an internationally recognized
state, economic activity in the country is in principle
considered illegal. A number of state companies have been
privatized without Moldovan approval. Nor has it been
established how much of the Moldovan government debt that
Transnistria should rightly take on.
The Transnistrian gas company
TiraspolTransGaz-Pridnestrovje receives its gas from the
Moldovan MoldovaGaz, which in turn buys it from Russian
Gazprom. The transnistrian company sells the gas to
customers in the breakaway republic for good profits but
pays nothing to the Moldavian supplier. MoldovaGaz cannot
stop that business because Gazprom is its principal owner.
Transnistria is estimated to have a formal debt to Gazprom
of at least SEK 25 billion. Russia, which believes that
Moldova is responsible for the debt, can use it to exert
political pressure on the government of Chișinău, which
seeks membership in the EU. The Russian president's special
envoy to Transnistria has said that Moldova must repay the
gas debt if the country were to be reunited.
Transnistria has a large and constant budget deficit,
which is covered by Russian financial support to around 70
percent. The country's isolation means that the prospects
for sustainable economic development are considered rather
small.
Transnistria has its own central bank and its own
currency, the Transnistrian ruble. It can be freely
exchanged within the state of the breaker at market rates
but cannot be used anywhere else. |
