17 June 2016. PenzaNews. The Defense spending of Moldova, which has a neutral status according to the Constitution, will be increased for about 25 percent in 2016, the Chairman of Moldova’s Parliament Andrian Candu said. The draft of the national budget was approved by the parliament in the second reading with a six-month delay.

Photo: Clay Gilliland, Flickr.com

Under the bill approved, it is planned that in 2016 state budget revenues will amount to 31 billion 378.9 million lei (1 billion 585.2 million dollars), and will grow by 11.9% in comparison with 2015, and the expenditures will amount to 35 billion 561.7 million lei (1 billion 796.5 million dollars), which is 17.1% more than the year before. The state budget deficit will be covered mainly through external financing, the sale of government securities, revenues from privatization and sale of state property.

The opposition has criticized the draft budget, noting that it is based on irrelevant forecasts, relies heavily on foreign aid, receipt of which is in question, and does not create the preconditions for economic growth or improve people’s livelihood.

Meanwhile, the country is participating in the third over the past month Moldovan-US military exercises Joint Combined Exchange Training – 2016 held in the training center in Bulboaca near the unrecognized Pridnestrovian Moldavian Republic, also known as Transnistria. The purpose of the exercise is to exchange experience between Moldovan and American Special Forces. They have to work out joint military operations and parachuting with the MC-6 and MC-5 parachute systems, which are in service of the US Special Forces ground troops.

At the same time, the Moldovan opposition considers the intensification of military cooperation with the United States as a gross violation of the neutrality recorded in the basic law of the state.

Participating in joint exercises with NATO, Chisinau sends a signal that Moldova is a de facto member of the alliance, says German political scientist Alexander Rahr.

“This puts Moldova’s neutrality in doubt. Moreover, one half of the population of your country is experiencing geopolitical sympathies toward Russia, the other – towards the West. If nothing is done, there may be a split in Moldova,” he said in an interview with a Moldovan media.

According to him, the upcoming presidential election and the election to the parliament may change the situation.

“Federalization of the country may be a real chance to stabilize the situation, as it will make possible the reintegration of Transnistria. Moldova needs to decide for itself; otherwise someone else will do it for Moldova,” the expert stressed, adding that ignoring the views of the Moldovan citizens by the government may lead to the mistakes that have occurred in Ukraine.

Commenting on the situation in the country, the public official of the Pridnestrovian Moldavian Republic, political scientist Andrey Safonov, suggested that external influence on political trends in the country is huge.

“From a political point of view, the government is led by the pro-Western compradors completely dependent on Brussels and Washington. There are no strategic development plans, or plans for the development of technology in Moldova; and it is beneficial to the European Union, which gets a cheap labor force. As to the economic sphere, the situation in the production area is fatal, which has been generated by the complete dependence of the country from Western financial institutions. The flow of migrants continues unabated. As a result, the state just depletes becoming a country of pensioners and young people, where the latter are often unable to find use of their skills,” he told PenzaNews.

In his view, the United States and the European Union seek to “put out the potential islet of Eurasian integration in the face of Transnistria, which is beyond their control.”

“Through Chisinau, Americans put pressure on Transnistria to transfer it under Moldova’s control and to make Russian troops and peacekeepers leave. The European Union wants Transnistria to join the agreement on association and trade zone between the EU and Moldova. In the future, we cannot exclude the attempts of tightening Moldova’s ties with NATO. Romania, which now acts as an active ally of the US in the south-western regions of the former Soviet Union, is very much interested in such events,” the analyst explained.

According to him, important events will unfold in the negotiations on the conflict in Transnistria in the 5 +2 format that includes the breakaway region and Moldova as the parties of the conflict, Russia, Ukraine and the OSCE as mediators, EU and US as observers.

“Chisinau, Brussels and Washington with the support of the Romania, which is not involved in the negotiations, will try to make Transnistria and Moscow begin the discussions of Transnistria status within Moldova. The West and Moldova may bring up the issue of Russian troops withdrawal and a change of the peacekeeping format. In between, they will put pressure on Transnistria through the economy to make Tiraspol retreat from the idea of its independence. However, the election of the Presidents of Moldova and Transnistria will somehow distract attention from the negotiations and foreign policy issues,” Andrey Safonov said.

He also stressed that Russia should not yield to persuasion and weaken its support for Transnistria.

“The game of the West will definitely aim to completely close the anti-Russian arc of former Soviet republics around Russia. Therefore, the US and the EU will seek to take control of Belarus and Transnistria, as the latest military and political allies of Moscow,” the expert added.

In turn, Gabriele Zimmer, President of GUE/NGL political group in European Parliament, also said that the external pressure on the political system in Moldova has always been high.

“The situation has worsened with the conflict in neighboring Ukraine and the signature of the EU-Moldova association agreement of 2014, which includes the free trade area. Russia’s penalty for this step of the so-called ‘pro-EU’ government was a ban first on wine and then on Moldovan fruit imports. This shows that countries like Moldova that are geographically situated between the EU and Russia should not be pushed to become an integral part of one side or the other - not to the price of war like in Ukraine or to the price of an economic and social break-down of the relations with other countries. There should not be a ‘pro-Russian’ or a ‘pro-EU’ government in Moldova, but a government that represents all interests in this multicultural and multilingual country and that first and foremost works on reforms in favor of democratic participation, social inclusion, and an independent justice system,” the MEP said.

According to her, the country needs an independent justice system and a real system of democratic power division with strong trade unions, an active civil society and free democratic opposition.

“We will continue to work with the civil society and democratic opposition in Moldova to help the country get back on track for social and democratic cohesion,” Gabriele Zimmer stressed.

From her point of view, the economic and social situation in Moldova is very bad for the ordinary citizens.

“A large part of the population lives in severe poverty. Many Moldavians, especially young and educated people, leave the country to work elsewhere, be it in Russia or in an EU member state, which causes a harmful brain drain. At the same time, Moldova suffers from an oligarchic system that is the biggest obstacle to economic and social development. Oligarchs control most of the political parties, the judicial system, and the media. The banking scandal of the ‘vanished billion’ that provoked mass protests in November 2014 is just an extreme example of this unscrupulous state capture by mafia elites,” the politician said.

According to Galina Selari, Executive Director at Center for Strategic Studies and Reforms (CISR) in Chisinau, political and economic situation in Moldova is very unstable today.

“The country feels some changes are coming, but subconsciously understands that there won’t be any positive shifts. The economy is stagnating. Despite some positive statistics, indicating some growth in industry and agriculture, the consumer prices during the same period increased by 10%. Export is steadily declining. For the first time in recent years, the volume of supply is reduced not only to the CIS market – the fact we got use to – but also to the EU market. The weather does not allow making any positive forecasts: it is already clear that the results of the agricultural year will be very modest,” the expert said.

According to her, the government has to borrow abroad, because it is not able to solve the problems of macroeconomic stabilization and finance its priority commitments to the citizens.

“The issue of external budget support is directly related to the resumption of financial relations with the IMF, and, consequently, the policy of stabilization and reforms should be agreed with the Fund. To date the Moldovan economy is more than ever determined by the policy. Sometimes the government just does not have enough time to discuss economic issues. For example, parliament is only being prepared to discuss the third reading of the draft of the national budget for the current 2016 year. They’ll think about its possible results tomorrow, and they’ll not think of the budget for 2017 at all,” Galina Selari added.

In turn, Bogdan Tardea, the political scientist, MP from the Socialist Party of Moldova, suggested that the economy of the state is “on the brink of the abyss.”

“In first quarter of 2016, the total volume of exports decreased by 14.5%, the volume of transported goods by 13.8%, real wages by 4.9%. General budget revenues decreased by 9.4%. Health care costs decreased by 42%, spending on education fell by 14%. The state budget deficit has grown by 6.8 times, and it is covered exclusively through internal borrowing, which resulted in the internal public debt increasing by almost 1 billion lei (about 50 million dollars) in first quarter of 2016. The government, which has no external funding and investment, decided to borrow from banks to pay pensions and salaries. The new draft of the national budget includes about 10 billion lei (more than 500 million dollars) of external loans. This has happened for the first time in the history of the country,” the deputy said.

According to him, the current government lacks popular support.

“The level of confidence in the government, president’s office and parliament is 10–12%. The government of Pavel Filip, controlled by oligarch Vladimir Plahotniuc, has the US support. The country is coming under external control: Washington openly imposed the government of Pavel Filip, despite of many months protests of the united opposition. There are Romanian consultants in every governing institution; the country participates in many NATO military exercises. In 2016, the EU-Moldova Association Council has started its work, actually becoming the body of the external governance,” Bogdan Tardea said.

However, in his opinion, the main threat for Moldova is the potential unification with Romania.

“They have started a powerful process of Moldova’s ‘Romanization.’ Romanian newspapers, TV channels, institutions and NGOs openly promote the idea of destroying Moldovan statehood. Some parties aggressively impose the idea that unification with Romania will speed up the accession to the EU and improve the financial status of citizens. There are persons with Romanian citizenship even in parliament, government, president’s office and the Constitutional Court. Almost every month, Romanian elite push the road maps for Moldova’s Anschluss; the question of unification is openly discussed in Moldova. After eight or ten years the Republic of Moldova may disappear from the political map,” the politician concluded.