Weekly Roundup
Welcome back to Moldova Matters! In this weekly roundup we will check in with the top stories of the week in Politics and Economics. Subscribe to Moldova Matters to get our Weekly Roundup and other content sent right to your email!
Political Crisis - Ultimatums, Threats and Confusion
As we discussed last week on the Weekly Roundup, the hurry up and wait atmosphere around the political crisis was due to culminate with the expiration of former President Dodon’s ultimatum to President Sandu. Recall, he gave her until March 9th to appoint the government he supported or to “risk the presidency becoming irrelevant.” While that seemed quite ominous at the time, President Sandu declared her intention to hold fast and wait the crisis out until March 23rd when elections will be automatically called. Many experts were divided on what Mr. Dodon had in mind and now it seems we can say that he wasn’t exactly sure either.
At the expiration of the deadline, the Socialist Party declared a convening of their Executive Committee in a meeting to discuss what comes next. This was not followed by any concrete statements at the time of writing (Feb 12) but was followed by a number of videos and press conferences from Mr. Dodon that further confused matters. In his video addresses, he has continued to explain the scenarios for resolving the crisis building from week to week. But these scenarios change quite often and are shuffled leading to a situation where it is hard to know why elections are no longer on the list at all (Scenario 4) and “Dialog” keeps moving from Scenario 3 to 2. Further complicating this message was a blunder where a staffer accidentally published Mr. Dodon’s weekly address with the title “President of Moldova” rather than “former President of Moldova.” This sparked backlash and attempts to clean it up further muddied the message. It is fair to say that the plan changes daily, and generally includes things like “more dialog” so the ultimatum seems to have passed without much teeth. However, Mr. Dodon has outlined additional ideas late in the week that seem more concrete. In one interview, he indicated he could find 67 votes in Parliament to suspend President Sandu from office for enough time to appoint an interim president and have that person appoint a Prime Minister. Another option being discussed is the expansion of the powers of the interim government either temporarily or indefinitely. All parties back some elements of this with the goal of allowing the interim government more freedom to negotiate on vaccines, etc. But the mechanism could be combined with a State of Emergency to indefinitely delay elections. Finally, Mr. Dodon has stated that he is prepared to become Prime Minister following elections - which he says are absolutely necessary because this Parliament is unrepresentative. Which he followed up by saying he does not know when these elections should be but certainly not now.
So where are we? It isn’t much more clear at the end of the week than the beginning. But March 23rd approaches and unless Mr. Dodon finds a plan or the Constitutional Court definitively intervenes; it seems the clock is running out
The State of the Pandemic
...is bad. The 7 day rolling average of new cases remains around 1300 cases per day. Additionally, Moldova has passed the 30 deaths per day mark consistently in the past week and continues to set negative records on deaths, cases and hospital admissions. It seems fair to say we are fully entering a new wave. This, on the one year anniversary of the first COVID-19 case in Moldova. Amazingly, information has come out that 1 in 3 Members of Parliament have already had COVID and 2 more are quarantining suspecting infection now. Given how little testing is done in Moldova this may be an interesting indicator at how widespread things really would be shown if regular testing (not just at hospital admission) were done.
In lockdown news, the Police have gotten very aggressive at raiding restaurants and nightclubs that open past the 10 pm curfew. Anecdotally, I can say that a few weeks ago it was very easy to find a nightclub or late night establishment operating illegally (as a restaurant owner, it is my industry - I am not attending them). Right now, much less so. This is a victory both for the rule of law and for pandemic control… but why haven’t they enforced the rules all along?
Ok, What about the Vaccines??
Well, vaccination continues for healthcare workers with Moldova’s limited stockpile. Meanwhile, the Interim Government is starting talks with China about it’s Sinovac shot, and generally there are major political discussions and arguments about how much money to allocate for buying vaccines, and how to procure them. Meanwhile, Sputnik V has yet to appear on the market here but is causing a lot of discussion in Europe about whether the EU should approve it. Sputnik will even be produced in Italy now as the Russian company behind the vaccine ramps up production. The US Government has recently warned about disinformation campaigns by Russia meant to attack the credibility of western vaccines and support the sale of Sputnik. Moldova has seen this all too well and debate continues to roil about which vaccines people find safe. Meanwhile, President Sandu appeared on CNN to discuss the issues procuring the Pfizer vaccine. This caused a minor sensation here as Moldova is not used to its President getting such publicity in the western press.
Finally, Moldova has yet to take any action about the unfolding Astrazeneca issues in the EU. Romania has ceased giving the vaccine from batch ABV2856 due to the reports of blood clotting and heart attacks in Italy. Romania stresses they have had no problems of their own and that no vaccines from this batch were sent to Moldova. No matter the outcome of the investigation, news like this can only hurt vaccine credibility in a country that is already dangerously skeptical.
A Year in Review - the Economic Crisis
Unfortunately, far too little coverage has focused on the crippling economic crisis that has roiled Moldova on top of the health crisis of this past year. But Agora did an excellent roundup of various key indicators of the past year and the picture they paint is bleak. While all sectors were affected in some way last year, import and export both fell massively along with other elements of the transportation industry. As we talked about in a past Weekly Roundup, Moldova Railways is on the brink of collapse with salaries 3 months behind. This week, the utility companies shut off the power to many train stations in the country. Meanwhile, while regional countries allocated around 5% of GDP in stimulus and fiscal intervention, Moldova only allocated around 1%. Of that 1%, only around 19% of the money allocated for worker support was spent. And I can tell from experience that is because they worked very hard to make sure that companies and employees could not easily qualify for help. Meanwhile, the HoRECA industry is the hardest hit with a 24.5% reduction in workforce compared to one year ago. Oddly, the “Average Monthly Salary” increased in Moldova and inflation was at a negligible 0.38%.
What about E-commerce? Did Moldova experience a boom?
Nope. Basically not. Unfortunately, the conditions for starting ecommerce stores in Moldova has been significantly hampered by regulatory problems (including difficulties with online payments), infrastructure problems with delivery possibilities, and unclear taxes around shops themselves. While some companies have gone online and Metro (a German big-box retailer) has been successful with grocery deliveries, these have been somewhat isolated cases as the challenges to working online are still significant. The government has been well aware of these problems for months but has made no moves to address them leaving the private sector once again between a rock and a hard place.
Corruption and Bureaucracy
This week, TV8 exposed a variety of massive schemes whereby government property would be fraudulently privatized for pennies on the dollar. These schemes involved companies renting derelict buildings in Chisinau or parts of parks and then applying to privatize without an auction. This is allowed for renters due to a loophole in the law. In multiple cases TV8 found buildings or property were privatized for 800,000 MDL ($45,000) only to be resold soon after for millions of Euros. Mayor Ceban thanked TV8 for their reporting and reiterated his commitments from the last years to strictly enforce auctions for public land.
Wait, so how could this have been going on for years and the Mayor didn’t know?
Well… let’s just say that Moldovan bureaucracy isn’t exactly efficient. This week, Mayor Ceban was horrified to discover that brand new public toilets he had constructed in a city park had not been unlocked in the last 18 months. It seems that the city constructed them, had an official opening (press release, etc) and then hired an attendant to take users’ 2 lei payment for the restroom and keep them clean. BUT no one ever connected the water. So this attendant has gone to work for 18 months in order to tell people that the bathrooms don’t yet work and to “please consider a convenient nearby tree.” Sadly, this is not an unusual case in Moldova’s bureaucratic web. I give credit to Mayor Ceban on trying to tackle this problem, but so far, it has proven to be more of a “what-a-mole” approach than anything that will be systemically sustainable.
Finally, Wasn’t this a Holiday Week?
Yes! Happy International Women’s Day everyone! March 8th is a major holiday in Moldova with people giving flowers and candies to the women in their lives and having family gatherings to celebrate. While this holiday is rarely known in the US, it actually originated in New York City in February 1909 when the Socialist Party of America declared a “National Women’s Day.” Today, much of the world celebrates this holiday to mark the progress in women’s rights and to highlight how far there is still to go. This year, the theme of the Holiday was “Chose to Challenge” encouraging people around the world to challenge gender norms and fight for equality. In Moldova, this holiday has taken on a much more traditional feel and sometimes seems to celebrate gender roles rather than challenge them. President Sandu’s comments on the holiday through sought to center the historical role of this day and are worth printing here in full:
“On International Women's Day, we celebrate the efforts of many generations of women and men to fight for equal opportunities and rights. For the right of women to decide their own future and for the opportunity to contribute to the life of society on an equal basis with men. I have never doubted the strength of Moldovan women. We make our careers and build families. We create a business, manage teams, educate future generations. I want every girl and every woman in our country to know that she can become whoever she wants: a researcher, a successful entrepreneur, a minister or the President of the country, if she works hard, she will be brave and will remember her strength.” - President Maia Sandu, March 8, 2021
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