Is Moldova ready to join the EU?

Editor’s note: Mikhail Poysik, former head of the State Planning Department of the RSSM, candidate of economic sciences, deputy minister of Industry and Trade (1995-1997). The article expresses the personal opinion of the author and may not coincide with the opinion of News.Az.

On June 23, 2023, the Republic of Moldova was granted candidate status for membership in the European Union. This significant event marks the beginning of a new phase in the country’s history, opening up prospects for closer interaction with European states. However, this path towards European integration, confirmed by the decision of the European Council of December 14, 2023 to begin negotiations, is not only long but also complex. At this stage, Moldova is undergoing an assessment of the conformity of its national legislation with EU requirements. This is only the first step on a path that will require considerable effort and transformation.

Moldova, once known for its advanced agricultural technologies, high-tech industry and harmonious development of education, science and culture, today faces serious problems. The main problem is the gradual transformation of the country into one of the poorest states in Europe. This transformation is accompanied by massive emigration: tens of thousands of citizens leave the country every year in search of better opportunities for self-realization abroad.

Although national statistics for 2023 are not yet available, previous years have shown worrying trends. Only about half of Moldovan economic entities report profits. This indicates that a significant portion of businesses are facing financial difficulties, compromising overall economic stability. Of particular concern is the consumer price index, which was 130.24% in 2022. Such a level of inflation significantly complicates business conditions and undermines the purchasing power of the population.

Nevertheless, the number of economic entities continues to grow, reflecting the current government’s inability to effectively manage the state amid high corruption. This raises questions about how prepared the Moldovan economy is for EU membership and what reforms are needed to meet EU demands.

To become a worthy partner of the EU, Moldova must significantly reduce the gap between its GDP per capita and European figures. This requires sustainable economic growth. In reality, Moldova will be able to join the EU with an annual GDP growth rate of around 8%. However, data for 2023 show that GDP grew by only 0.7%, and in the first quarter of 2024, it grew by only 1.4% compared to the same period last year. These figures indicate that the current pace of economic growth is insufficient to achieve the integration goals.

Moreover, Moldova only shows its ability to increase its debts. The external public debt has increased 2.17 times under the current government. These funds are not intended for the development of infrastructure and the economy, but for servicing previously taken loans and current consumption. The internal debt has also increased 1.71 times, which indicates a lack of funds to cover the state budget deficit.

The main task for Moldova on the path to European integration is to carry out deep economic reforms. It is necessary to improve the business climate, reduce the level of corruption and create the necessary conditions for attracting foreign investment. This will require a revision of tax policy, improvement of the legal system and strengthening of institutions that ensure transparency and accountability.

However, given current realities, discussions about possible EU membership should be taken seriously, just like Farjatev’s well-known fantasies. No more than that. Against the backdrop of the numerous economic and social problems Moldova faces, talk of imminent EU membership seems far from a reality. The country’s economic situation, characterized by high inflation, low GDP growth rates and growing public debt, does not allow serious consideration of prospects for EU integration in the near future.

Moldova must now focus on internal reforms and stabilization of its economy. Only after the main economic problems are solved can the real possibilities of EU membership be discussed. Otherwise, all discussions on this topic will remain mere fantasies without any real basis.

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News.Az