Moldova Weekly: A piggyback for the piggy bank, all kinds of Samaritans, blame the media
Moldova in brief, week #17, April 20-26.
A piggyback for the piggy bank
The government estimates a budget deficit of 16 billion lei or 800 million euros as a result of the coronavirus crisis. The IMF came to help with an emergency credit of $235 million, which the prime minister said on Thursday were already in the government coffers. The EU, in addition to the €87 million promised in non-budgetary aid, made available another €100 million as emergency macro-financial assistance.
Another, more controversial, lifeline came from Russia. Four months after announcing a $500 million loan from Moscow, Prime Minister Chicu finally sent the loan agreement to be ratified in the Parliament. The amount though had dropped to €200 million, to be paid in two installments and subject to some shady provisions.
According to a Transparency International analysis, two of the most questionable clausesof the agreement were 3.3 and 7.2. The former says that the Moldovan government will provide Russian companies with conditions “no less favourable” than for Moldovan ones to participate in public tenders, partnerships and contracts (basically a most favoured customer clause). In other words, it is possible that the money loaned from Russia will end up on the accounts of Russian companies. Clause 7.2 is even more contested: it says Moldova could be held liable for debts contracted by private Moldovan companies from Russian banks that were guaranteed by the Russian government.
PAS called upon the Democrats, who had claimed to be part of the ruling coalition in order to maintain the country’s pro-European course, to vote against the agreement or at least to remove the two controversial provisions from the final draft. PDM MPs refused to negotiate with PAS but introduced two amendments: only those private debts that were contracted after the signing of the loan agreement and are sanctioned by the Moldovan Parliament will be convertible into state debt.
The Socialists labeled opposition criticism that the loan will increase Russian influence in Moldova as “Russophobia”. The PSRM-PDM majority voted in favor of the loan agreement, with two PDM MPs absent and two others abstaining.
The ball is in the Court
As soon as the Parliament ratified the agreement, the Constitutional Court suspended its effects. Before the legislative meeting, Pro Moldova MP Sergiu Sîrbu asked the CC to check the agreement’s compliance with the Constitution. As such, the judges issued a preliminary injunction delaying the entry into effect of the agreement must be delayed until they examine its constitutionality.
Earlier the same day, another news came from the CC: chairman Vladimir Țurcan was dismissed and replaced with Domnica Manole as the new head of the Court. The judges weren’t very talkative about it, but it seems the main reason was Țurcan’s conversation with President Dodon the previous week. Igor Dodon publicly admitted he had called Țurcan to find out what the CC would decide regarding the government’s “assumption of responsability” (bypassing the Parliament to adopt a law). Many saw this as illegal interference in the Court’s work and PDA leader Andrei Năstase threatened to sue Țurcan.
In response to these CC decisions, president Dodon said ”someone might have tried to take over political control of the Court”. He also pointed out that this proves the Socialists do not control the CC, as previously speculated by political pundits, especially since Țurcan was a former PSRM MP. Igor Dodon promised to defend the Court’s independence, but did not shy away from putting some more political pressure on the judges. He warned that if the government doesn’t have money to pay public wages because of its rulings, it will be the CC who will have to ”take responsibility”..
The temporary freezing of the Russian loan agreement is not the first obstacle the government stumbled upon at the Constitutional Court. The judges also canceled the government’s “assumption of responsibility” to pass the package of anti-crisis measures. So Prime Minister Chicu was forced to come and present these measures in the Parliament.
The bill is more or less unchanged: VAT reimbursement, interest subsidies for business loans, a reduced VAT for the hospitality industry (15% instead of 20%), as well as some measures that seem unrelated to the current crisis. For example, duty free exemptions for Moldovan products, or reduced taxes for the extractive industry, or the delay of some tobacco sale restrictions.
MPs like PDA’s Igor Munteanu or Pro Moldova’s Andrian Candu asked the prime minister why there’s no direct financial support for businesses, such as subsidies for wages or rent. Ion Chicu’s answer was blunt: there is no money.. Other MPs, like PAS’ Dan Perciun, fear that even the adopted measures, insufficient as they are, will not be available to those who need them, but only to big companies or those close to the ruling coalition. The anticrisis package passed with the votes of PSRM and PDM.
All kinds of Samaritans
Last Sunday, accompanied by the Russian and Chinese ambassadors, President Dodon went to the Aiport to welcome a delivery of over 50 tons of medical equipment from China. While the cargo plane was made available by Russia as a courtesy, the equipment was paid for, not donated. The President still presented this shipment as a great diplomatic success.
The problem is that, three days on, the equipment still didn’t reach hospitals. The importer didn’t have enough money to clear the shipment at the border. Its representatives said they ran out of currency because they had to pay the Chinese manufacturer upfront, while the Moldovan government was late with the payment for an earlier delivery. The company asked for the duty payment to be deferred until after the government has paid the earlier service, but Vitalie Drăgancea, advisor to PM Chicu, said this was “blackmail” and promised the company would be sanctioned.
Meanwhile, a batch of aid from the EU for the districts of Cahul and Ungheni – protective equipment that has been donated, not paid for – has received zero attention from the central authorities.
Contagion, parks and recreation
It seems that overeating was not the only side effect of Easter dinners, which traditionally come with large family gatherings in Moldova. This past week, the daily count of Covid-19 infections broke one record after another: first on Wednesday (+164), then on Friday (+184), and yet again on Saturday (+194). The next Sunday and Monday after Easter, Moldovans traditionally commemorate their dead, and although the Church postponed Memorial Easter until June 6-8, visiting graveyards has not been formally banned by the authorities. This will likely mean more urban-to-rural travel. But at least in Chisinau cemeteries remain closed and, like in Balti, public transport has been suspended altogether on Sunday and Monday. In the most optimistic case scenario expected by the authorities, the case count will stand at 5,600 in two weeks, and at 37,000 in the worst.
“We can not afford to relax [restrictions] a iota in the near future,” cautioned President Dodon before going on: “even if we will allow the resumption of some activities, which is economically necessary.” And so, starting April 27, outings in parks are allowed. All types of retail commercial units, except for those concentrated in markets and shopping centers, will reopen their doors.
Blame the media
In the Press Freedom Index updated this week, Moldova’s position remained unchanged at 91st out of 180 nations. Reporters without borders found that the media empire built by former Democratic Party boss Vladimir Plahotniuc has been quickly replaced by a media group affiliated to the Party of Socialists. Globally, the Covid-19 pandemic has amplified the many crises faced by the independent media. Quality journalism is economically impoverished, as the overall media landscape is contaminated with unreliable information. In some authoritarian nations, press freedom is limited under the pretense of fighting “fake news”.
This week, Deputy Speaker Vlad Batrîncea accused the West of giving out “millions of euros” in “tax-exempt” grants to Moldovan journalists. The Socialist MP was particularly concerned that such reporters “rouse doctors in the dead of night” to solicit insights about how the authorities are handling the coronavirus crisis. Media NGOs reacted by saying the statement was meant to intimidate independent journalists who seek to show the entire picture.
Also this week, the Center for Investigative Journalism NGO, which runs the popular portal anticoruptie.md, found out accidentaly that it was being sued for libel by deputy prosecutor general Ruslan Popov. While Popov’s complaint didn’t specify his claims, anticoruptie.md assumes they could be related to two investigative pieces into Popov’s possessions and business interests. Curiously enough, the case will be heard by judge Rodica Berdilo, the one who infamously annulled the 2018 mayoral election in Chisinau.
Neither in health, nor in sickness
A Russian donation enabed the de facto authorities of Transnistria to open their own lab for detecting the novel coronavirus. The authorities in Chisinau say this lab has a very limited capacity, of only 60 tests a day, and the type of tests it uses is less accurate, too, so Tiraspol will have to further rely on Chisinau to confirm the cases anyway.
So far, not even in the face of the pandemic have politicians on both sides of the Nistru been able to find common ground. Deputy Prime Minister for Reintegration Cristina Lesnic says that Tiraspol has rejected Chisinau’s offer to create a joint task force of doctors, assisted by WHO experts. Instead, Tiraspol “has mounted a disinformation campaign” targeting Chisinau.
More news, in one sentence
◼️ Igor Dodon: “I very much want to see [ordinary] presidential elections take place this fall and they will take place this fall, between October 23 and November 23.”
◼️ Maia Sandu has promised she will endorse Andrei Năstase’s presidential bid only if he makes it to the second round.
◼️ Balti Mayor Renato Usatîi has been formally accused in Moscow of smuggling over ₽500 bn (€6.18 bn) out of Russia via a Moldovan bank.
◼️ An overwhelming majority of twelfth graders think the online Baccalaureat practice courses have been inadequate, prompting Maia Bănărescu, ombudswoman for children’s rights, to ask the government to consider postponing or canceling this year’s Baccalaureat exams.
◼️ Avia Invest is taking the Moldovan government to international arbitration in a bid to keep the lease over Chisinau Airport.
◼️ Rapid coronavirus tests have become available in Moldovan drugstores, and while the manufacturer calims they are 92% accurate, Dr. Angela Paraschiv, a leading epidemiologists, says that every other such antibody test renders a false result and that it’s pointless to get one until at least 10 days have passed since the estimated time of infection.
◼️ With the exception of shots given in maternity wards and vaccines against rabies, the Agency for Public Health has suspended all immunization services.
◼️ With global oil prices plummeting, prices at the pump dropped by one leu this past week.