Tag Archives: Vladimir Plahotniuc

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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Moldovan President Igor Dodon Suspended by the Constitutional Court

The Moldovan Constitutional Court temporarily suspended the country’s president, on October 20, following a request by the government to interpret article 98, paragraph 6 of the Constitution, covering the president’s role in government reshuffles (Constcourt.md, October 20). The issue dates back to December 27, 2016, when the office of the minister of defense became vacant after then-minister Anatol Salaru was dismissed by the newly inaugurated President Igor Dodon. The Liberal Party, at that point a member of the ruling coalition, withdrew its political support for Salaru, and the government initiated the dismissal, which was eagerly accepted by Dodon. However, the president refused to appoint then–environment minister Valeriu Munteanu, another Liberal Party appointee, to fill the vacancy at the top of the defense ministry. The inter-institutional deadlock was immediately addressed by the Constitutional Court on January 24, 2017. On that date, the Court ruled that a president can only decline a prime minister’s proposal for a government reshuffle once, but it did not elaborate on what happens if the president refuses to accept a cabinet nomination for a second time (Constcourt.md, January 24).

The Democratic Party–controlled government never went ahead with nominating Valeriu Munteanu for a second time. Meanwhile, the Liberal Party withdrew from the ruling coalition in May and was replaced by a group of Liberal Democratic Party defectors, under the leadership of former prime minister Iurie Leanca, who became deputy speaker of Parliament on June 2. The European People’s Party of Moldova, headed by Leanca, nominated its vice president and Leanca’s former chief of staff, Eugen Sturza, to become minister of defense. However, the public announcement came from the Democratic Party chairman, Vlad Plahotniuc, on September 12. President Dodon rejected the nomination the following day, citing Sturza’s lack of experience in the defense sector and the nominee’s questionable integrity. Instead, Dodon proposed former defense minister Victor Gaiciuc (2001–2004), who also served as Moldova’s ambassador to the North Atlantic Treaty Organization (NATO) during former Moldovan president Vladimir Voronin’s second term (Zdg.md, September 13). The government insisted on Sturza, but President Dodon rejected his nomination again on September 18 (Unimedia.info, September 18). The following day, the government appealed to the Constitutional Court for a way out of this deadlock.

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The Court issued a highly controversial ruling on October 17, mandating that if the head of state refuses to carry out his constitutional duties by rejecting a cabinet nomination twice, this represents grounds for his or her temporary suspension from office (Constcourt.md, October 17). Two days later, the government asked the Constitutional Court to temporarily suspend the president, which it did on October 20 (Constcourt.md, October 20). Under the Court’s ruling, the president’s suspension will be in force until an acting president appoints a new defense minister—despite the fact that no such provisions exist in Moldova’s Constitution. Article 89 of the Constitution clearly states that a president can only be suspended from office if he or she has violated the Constitution. One third of the members of the parliament need to initiate the suspension, and two thirds of the legislators need to vote in favor for the suspension to be approved; only the citizens can remove the president from office in a national referendum (Presedinte.md, accessed October 24). Ironically, the government acknowledges in its referral to the Court that, despite President Dodon having violated the Constitution, “a referendum is too difficult to achieve” and “it does not guarantee a solution to the deadlock” (ConstCourt.md, September 19), meaning that a recall referendum against Dodon is likely to fail. The absurdity of the situation is that Dodon’s fellow Socialists agree that the president has violated the Constitution and Dodon himself openly calls for a referendum (RTR Moldova, October 20). Nonetheless, the Democratic Party pulled an ace from its sleeve, as the Constitutional Court equated Dodon’s brazen refusal to carry out his duty with a president’s inability to do so—a provision normally covering health-related impediments.

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The present situation is not the first time Moldova’s Constitutional Court has engaged in similar far-reaching judicial activism. In fact, Dodon owes his presidency to a highly controversial ruling that reintroduced direct presidential elections in March 2016 (see EDM, March 8, 2016). Another watershed decision was the banning, in April 2013, of then–prime minister Vlad Filat from being reappointed to head the cabinet based on allegations of corruption (RFE/RL, April 23, 2013). This time, Dodon attempted to give the Court a taste of its own medicine, alleging that Eugen Sturza, a former Filat advisor, was also corrupt, but to no avail. The Constitutional Court’s refusal to entertain such charges has strengthened critics’ accusations that Moldova’s highest court currently serves the interests of one person—oligarch Vlad Plahotniuc. Though, it may seem as if this latest court ruling undermines the tacit Plahotniuc-Dodon power-sharing agreement (Jamestown.org, March 23), in fact, the Plahotniuc-controlled government did Dodon a favor by allowing him to save face by virtue of not taking part in this cabinet appointment. Some are even predicting that this controversial ruling could be used to make Plahotniuc prime minister without Dodon having to take the blame for it (Deutsche Welle—Romanian version, October 18; Trb.ro, October 20).

Meanwhile, on October 24, Sturza was sworn in as defense minister by Parliamentary Speaker and Acting President Andrian Candu, thus ending President Dodon’s suspension. Still, there is hardly any major political party, other than the Socialists, willing to defend Dodon against this attack on presidential powers that undermines the few remaining checks and balances in the Moldovan political system. Moldova’s highly polarized politics notwithstanding, Dodon and Plahotniuc are both fully complicit when it comes to the most dramatic case of democratic backsliding in Moldova’s recent history—the change of the electoral system (see EDM, July 25). Ultimately, how Dodon reacts to this latest challenge to his constitutional powers could either make or break his presidency. So far, he has vaguely threatened to initiate a popular movement in favor of “early parliamentary elections and transition to a presidential form of government” (Presedinte.mdNewsmaker.md, October 18). Yet, regardless of what the president does, Plahotniuc is now in an even stronger position to further consolidate his grip on power.

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