Category Archives: Parliamentary elections 2018

High-Level Corruption Threatens Moldova’s European Aspirations

Every April 7, Moldovans take stock of the progress the country has made since the youth protests of April 2009, which popularly became known as the “Twitter Revolution.” Nine years ago, this civil unrest led to the demise of Communist Party rule and ushered in a coalition of pro-European parties into power. However, hopes for a more democratic and accountable government not only failed to materialize, and many perpetrators of the brutal police crackdown in April 2009 have since been promoted to key state positions by the now ruling Democratic Party (Anticoruptie.md, April 7, 2017). This sense of impunity, coupled with poor economic conditions domestically, discourages young Moldovans from investing any hope in their country’s future. According to the latest poll by the International Republican Institute, 76 percent of respondents do not think that young people have a “good future in Moldova,” while 96 percent said “corruption is a big or very big issue” in the country (Iri.org, March 29, 2018). A recent joint report by the European External Action Service and the European Commission stated that “corruption still remains widespread, and independence of justice, law enforcement as well as national anti-corruption authorities need substantial improvement” (Europa.eu, April 5). Thus, endemic corruption and democratic backsliding not only undermine Moldova’s European aspirations, but also create fertile ground for political instability and civil unrest, this time against a nominally pro-European government.

The same European Union report on Moldova’s record of implementing the Association Agreement with the EU recalls that the change of the electoral system in July 2017 went against the recommendation of the Council of Europe’s Venice Commission and the Office for Democratic Institutions and Human Rights of the Organization for Security and Cooperation in Europe (OSCE). European democracy watchdogs have repeatedly warned Moldova not to introduce the mixed electoral system, because it is likely to exacerbate the country’s corruption problem by allowing wealthy businesspeople to influence elections in single-member districts (Venice.coe.int, March 19; see EDM, January 10). This concern is a major reason why the EU is withholding 100 million euros ($124 million) in macro-financial assistance, earmarked for Moldova last year. According to Vice Chair of the European Parliament Committee on Budgets Siegfried Muresan, EU funds would have arrived already had it not been for the controversial change to the electoral system (Europalibera.org, February 1). On a recent visit to Moldova, Muresan emphasized that at least three or four of the ten EU conditions for the first tranche (30 million euros) have not been met (Adevarul.roCotidianul.md, April 6). Indeed the EU-Moldova Memorandum of Understanding sets clear deliverables in terms of public-sector governance, the fight against corruption and money laundering, energy-sector reforms, etc., but it also demands respect for effective democratic mechanisms, including a multi-party parliamentary system and the rule of law (Europa.eu, November 23, 2017). The latter is much more difficult to achieve, and given how the investigation into the billion dollar bank fraud is going (see below), the government appears to be barely trying.

One billion dollars (12 percent of GDP) was siphoned off from three Moldovan banks prior to the 2014 parliamentary elections. “The theft of the century,” as it has come to be known, is a litmus test for the Moldovan justice system. Moldova’s National Bank hired the New York City–based investigative consultancy Kroll to conduct a financial forensic investigation. Already in its first report, presented in April 2015, Kroll identified controversial businessman Ilan Shor, who controlled the three embattled banks, as the main figure behind the fraud. The consultancy firm’s second report, from December 2017, pointed to 77 companies linked to Shor, who is identified as one of, “if not the only beneficiary” of this highly coordinated fraud (Candu.md, May 4, 2015; Bnm.md, December 21, 2017). Yet, despite being convicted by a lower court to seven and a half years in prison in June 2017, Shor appealed the ruling, and the case has been stalled (Deschide.md, April 2, 2018). Shor remains at large, and in the meantime, he became mayor of a large town, took over the leadership of a political party and is gearing up to enter the parliament. Keen observers of Moldovan politics know that this would be impossible without the protection from the head of Moldova’s ruling Democratic Party, oligarch Vlad Plahotniuc, who used Shor’s depositions to imprison Plahotniuc’s political and business rivals (former prime minister Vlad Filat, oligarch Veaceslav Platon and mogul Chiril Lucinschi) in swift closed trials. The symbiotic relationship between Vlad Plahotniuc and Ilan Shor is the embodiment of high-level corruption that makes the EU increasingly frustrated with Moldova.

Endemic corruption, exacerbated by changes to the electoral system, led to Moldova’s demotion from flawed democracy to a hybrid regime, according to the Economist Intelligence Unit’s Democracy Index (The Economist, February 4). The risks of Moldova becoming synonymous with corruption are manifold, yet two main threats stand out. First, if it continues to only pay lip service to fighting corruption, Moldova will fail to advance its European integration efforts. Second, if the highly disputed mixed electoral system indeed produces a rather unrepresentative outcome in the parliamentary elections scheduled for the end of 2018, the country could plunge into another cycle of political instability, which could be exploited by foreign actors such as Russia. With all that in mind, it is nonetheless becoming apparent that the main fault-line in the Moldovan political debate is less of an East-West divide, but rather rivalry between those defending democracy and good governance and those content with clientelism and corruption. Both the nominally pro-EU oligarch Vlad Plahotniuc and the drudgingly pro-Russian President Igor Dodon are, in fact, progenies of Communist Party leader Vladimir Voronin’s regime, which Moldova’s millennial generation rose up against in April 2009, only to grow disheartened a decade later.

 

Note: This article was written for the Washington based Jamestown Foundation and the original can be accessed here.

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A Year in Review: Oligarchic Power Consolidation Defines Moldova’s Politics in 2017

Moldova witnessed clear signs of democratic backsliding in 2017, along with window-dressing reforms and paying lip service to its international and domestic commitments. Against this backdrop, the country did experience some consumption-based economic growth, which the government has identified as stability, although the opposition views it as stagnation at best. The days of Moldova being a success story of European integration are long gone. Yet, it is the billion dollars siphoned off from the banking system back in 2014 that unveiled the true nature of Moldova’s dysfunctional state. The acrimonious unraveling of the ruling coalition, which followed the banking scandal, tore down the democratic façade the pro-European ruling parties have been projecting since coming to power in 2009.

Ironically, it is the Democratic Party (PDM) that has been at the center of Moldova’s recent democratic backsliding, after benefiting the most from the demise of its main rival, the Liberal Democratic Party (PLDM). The latter ended up a scapegoat for the billion-dollar heist. PDM and its leader, oligarch Vlad Plahotniuc, has been instrumental in defusing the anti-government protests that swept the country in 2015 by having the Constitutional Court reintroduce direct presidential elections (see EDM, March 8, 2016). The subsequent presidential campaign distracted the public and the opposition for most of 2016, paving the way for Vlad Plahotniuc to embark on a power consolidation offensive that transformed PDM from a once junior coalition partner into a dominant political force. Plahotniuc meticulously cemented his power throughout 2017, despite lacking popular legitimacy and being widely reviled by the public (Moldova.org, December 14, 2017).

The Democratic Party only garnered 15.8 percent of the vote in the 2014 parliamentary elections, resulting in 19 seats in the 101-person legislature. Yet, thanks to Plahotniuc’s immense wealth and vast influence over law enforcement, since the election he managed to turn a majority of former Liberal Democrat and Communist legislators to his side, building a comfortable majority of about 60 seats. Nonetheless, despite having full control over the government and about 75 percent of the media market, in early 2017 PDM still polled below the parliamentary threshold of 6 percent (IRI.org, March 2017). To mitigate the risk of losing power, in March Plahotniuc introduced a mixed electoral system (half of the seats assigned proportionally and half under a “first past the post” arrangement). Disregarding democracy concerns and condemnations from the Council of Europe, the Organization for Security and Cooperation in Europe (OSCE), the European Union and the United States, the new Moldovan electoral system was approved on July 20, thanks, in part, to support from the Socialist faction in parliament (Venice.coe.int, June 19, 2017; Eeas.europa.eu, July 21, 2017; Md.usembassy.gov, July 24, 2017).

The new law is likely to produce a highly unrepresentative parliament, further entrenching politicians’ clientelistic behaviors and deepening state capture. The new electoral system benefits the incumbent Democratic Party but also large established parties, namely the Socialists. At the same time, it undermines the electoral chances of new political parties, such as the Action and Solidarity Party (PAS) and Dignity and Truth Party (PDA) (see EDM, July 25, 2017). Opposition parties as well as civil society groups protested against the voting changes, but to no avail. The government retaliated against civil society by promoting a bill similar to the Russian “foreign agent” legislation aimed at curbing public dissent (Open Democracy, August 22). Feeling emboldened, Plahotniuc’s regime also stepped up its harassment of opposition activists in the regions and went after local mayors who had not yet defected to the Democratic Party.

Meanwhile, Plahotniuc has been instrumental in exploiting the geopolitical tensions across Europe’s East. In order to convince the West to turn a blind eye to his power grab, Plahotniuc went to great lengths to present himself as a victim of Russian meddling in Moldova. The Chisinau government even expelled five Russian diplomats, declared Russian Deputy Prime Minister Dmitri Rogozin persona non grata and banned Russian propaganda in Moldova, with little to no reaction from Moscow. This can be partially explained by the fact that, at the same time, Plahotniuc helped the pro-Russia candidate Igor Dodon win the presidency in Moldova. Plahotniuc made sure that Moldova continues to buy electricity from the Russian state-owned, Transnistrian-based power plant, despite Ukraine having won the supply contract in an international bidding contest. Moreover, Plahotniuc owns the rebroadcasting rights for the premier Russian propaganda tool, the first federal TV channel Perviy Kanal, while the second Russian federal channel, NTV, is rebroadcast in Moldova by an associate of Dodon’s.

 

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Thus, on the one hand, Plahotniuc and his army of lobbyists routinely ask the West to help Moldova against an aggressive Russia (Wall Street Journal, December 27, 2017), while, on the other hand, Dodon complains to Vladimir Putin about Western meddling in the small country (TASS, January 4, 2018). Meanwhile, Plahotniuc and Dodon have cooperated on major decisions, such as the change of the electoral system as well as dividing up ambassadorial posts among their own supporters. And despite Dodon’s repeated suspension from office by the government last year, the two men have thus far been able to avoid any meaningful political confrontation—aside from mutual theatrical rebukes in the media—prompting numerous accusations of a Plahotniuc-Dodon political cartel (Infotag.md, November 9, 2017).

This puts the genuinely pro-EU and anti-oligarchic opposition parties in a difficult political position. Realizing their weaknesses, the Action and Solidarity Party and Dignity and the Truth Party are pooling their scarce resources, counting on the synergistic effect of a future electoral bloc (Unimedia.info, October 16, 2017). Yet, the two are still struggling to outmaneuver Plahotniuc and Dodon. In particular, the opposition seeks to change the public narrative away from geopolitical debates (whether Moldova should be pro or against Russia or the EU) and toward a more governance-oriented discussion regarding state capture, corruption, democracy and rule of law. This is likely to be the main challenge for the opposition going into the November 2018 general elections.

Next year’s parliamentary campaign could become a turning point for the country. Yet, many disillusioned Moldovans see real change as almost too good to ever materialize. This makes apathy all too common, which only works in favor of the ruling elite, content with obfuscating popular scrutiny and operating with general impunity. The past year took Moldovans back at least a decade in terms of media freedom, rule of law and political pluralism. If these trends continue, Moldova may soon come to more closely resemble Belarus and Azerbaijan and less the European Union that so many Moldovans aspire to join.

 

Constantin Grigorita 27 August 2017

Protesters and Police meet on Independent Day, 2016. Photo: Constantin Grigorita.  

 

 

Note: This article was written for the Washington based Jamestown Foundation and the original can be accessed here.