European achievements and perspectives. How did the relationship between the European Union and the Republic of Moldova evolve in 2023?

As the negotiations regarding the accession to the European Union have started, the Republic of Moldova will engage in an extensive process of modernization and reforms. The EU and its member states will support the country’s European journey, providing substantial financial and technical assistance to initiate the accession process. These initiatives will contribute to increasing the standard of living in the country, and the citizens of the Republic of Moldova will feel the advantages of being part of the European family from an early stage.

It is the right time to review the main achievements of the EU-Republic of Moldova relations in 2023 and to look at the perspectives opening up for 2024.

• The European Council started the negotiations with the Republic of Moldova
• The macro-financial assistance for the Republic of Moldova was increased by 145 million euros, almost double compared to the previously announced funds
• 895 thousand citizens used the compensations for heat, electricity and solid fuels
• The Republic of Moldova became part of the Civil Protection Mechanism
• The Republic of Moldova is the first non-EU country to receive access to the Connecting Europe Facility
• 64% of the exports of the Republic of Moldova reached the European markets in January – September 2023
• Credits of approx. 16.5 million euros were granted, providing financing for 109 initiatives of Moldovan farmers
• 75 million euros were allocated for the modernization of ten district hospitals
• 8 million euros were offered to support entrepreneurs in the 2023 – 2026 period
• 6.4 million euros were redirected to cultural heritage protection works
• 40 media institutions received grants, capacity building, mentoring and training
• More funds for the Republic of Moldova were allocated. The European Union has increased the macro-financial assistance for the Republic of Moldova

The economy of the Republic of Moldova was severely affected by the consequences of Russia’s war of aggression in Ukraine, and the challenges related to energy security put even more pressure on the authorities in Chisinau and the citizens of the country. In this regard, the European Commission proposed to increase the previously allocated macro-financial assistance for the Republic of Moldova by 145 million euros, of which 72.5 million euros have already been transferred to the Republic of Moldova. The support comes to cover part of its additional financing needs, support macroeconomic stability, and ensure the continuation of reforms.

The ongoing macro-financial assistance for the Republic of Moldova has a total value of up to 295 million euros, of which 220 million euros are in the form of loans and 75 million euros in the form of grants. Starting from August 2022, Moldova received 172.5 million euros, 122.5 million being disbursed in 2023.

Ajutor la contor programme. Hundreds of thousands of citizens have been granted compensation when paying bills for electricity, heating, and solid fuels

More than 895 thousand citizens received financial aid from the European Union in the 2022-2023 heating season. Part of the costs for electricity, thermal energy, and solid fuels were covered by European funds. The compensations reduced the level of energy poverty by 43%, with the greatest impact being felt by vulnerable families whose bills were compensated by an average of 58%.

For the incoming heating season, more than one million people submitted compensation requests through the “Ajutor la contor” programme, created in 2022 by the Government of the Republic of Moldova, with the support of the European Union, Slovakia, and the United Nations Development Program (UNDP). Also in 2023, the programme for replacing the old appliances in vulnerable households was launched, with a total estimated budget of 5.8 million dollars. It offers vouchers, from European funds, for covering up to 80% of the cost of a refrigerator, electric stove, or washing machine, while the beneficiaries will contribute by covering 20% of the value of the equipment.

Green energy in public buildings in Moldova

More than one million citizens of the Republic of Moldova will benefit from modern medical institutions, thanks to the assistance of the European Union, the European Investment Bank (EIB) and the European Bank for Reconstruction and Development (EBRD). Ten Republican hospitals, nine from Chișinău and one from Bălți will be improved from the energy efficiency perspective. Thanks to the modernization of the buildings, patients will benefit from better medical services, and employees – from more favorable working conditions. The hospitals will be equipped with photovoltaic panels, heat distribution, and ventilation systems, interior renovation works will be ensured, sanitary facilities will be improved and access ramps for people with disabilities will be implemented. The assistance worth 75 million euros will increase the energy efficiency of public buildings in the Republic of Moldova, reduce energy consumption and lower costs. As a result, approximately 40% less resources will be used, which will allow savings of approximately 2.8 million euros per year.

Medical institutions in Florești, Ialoveni, Nisporeni and Telenești districts are to be adjusted from the energy efficiency perspective. As a result of the rehabilitation of the 11 buildings, an annual saving of thermal energy of approximately 60% and of electrical energy of approximately 30% is expected. The renovated buildings will improve medical services and working conditions for approximately 26,500 patients and employees of the health system. The total cost of the investments is 2.1 million euros, of which the Nordic Environment Finance Corporation – NEFCO (Nordic Environment Finance Corporation) contributed with a loan of approx. 1.3 million euros, the Partnership for Energy Efficiency and Environment in Eastern Europe (E5P), to which the European Union and Sweden are the biggest contributors, with 620 thousand euros, local contributions of the four districts – 215 thousand euros. In addition, Sweden contributed EUR 72,500 for technical assistance.

Five other district hospitals switched to green energy thanks to the European Union, after investing half a million euros through the UNDP to install photovoltaic panels. They are located in Florești, Nisporeni, Ștefan Vodă, Cahul and Călărași districts.

Sustainable, digital, and green business. Thousands of entrepreneurs benefit from EU support

The European Union has allocated eight million euros in the form of non-reimbursable funds for programs to support small and medium-sized enterprises (SMEs), implemented by the Organization for the Development of Entrepreneurship (ODA). The results of the “EU for SMEs” project, expected for 2023 – 2026, aim to support at least 300 enterprises in their efforts to create, develop, expand or internationally promote their businesses, of which at least 50% will be able to take advantage of new opportunities in sectors with high growth potential, and 80% will cover rural areas. According to the Economic and Investment Plan announced by the President of the European Commission, Ursula von der Leyen, over 50,000 SMEs from the Republic of Moldova will benefit from direct support from the EU. In 2021 alone, more than 6,000 small and medium-sized enterprises were supported and at least 8,000 jobs were created.

Made in Moldova, appreciated in the world. Moldovan products on European markets

The regulation according to which Moldovan farmers can export to the European Union seven categories of products in double quantities without customs duties has been extended for another year. Moldovan plums, grapes, apples, grape juice, cherries, tomatoes, and garlic can reach European markets in larger quantities. Even if the quotas increased significantly, the producers from the Republic of Moldova did not cover all the export quotas in one year. According to the National Bureau of Statistics (NBS), 64% of Moldova’s exports reached the European Union in January – September 2023, 5% more than in the same period of the previous year.

We grow together. Advantageous loans for farmers

Since the launch of the “Livada Moldovei” programme in 2016, more than 530 economic agents have received loans under advantageous conditions of 92 million euros. Only in 2023, credits of approximately 16.5 million euros were granted, which financed 109 initiatives of farmers from the Republic of Moldova. This year, the eligibility criteria were extended from the horticultural sector to the entire agri-food sector. Thus, as of 2024, businessmen from branches such as horticulture, viticulture, animal husbandry, aquaculture and fish production, tourism, beekeeping, and the cereal crop sector will be able to access financing for business development under more accessible conditions – with credit terms of up to ten years, four-year grace period, attractive interest rate and financial cap. Another 28 million euros are available for business development.

We create opportunities and connect communities. European roads and increased road safety

The Republic of Moldova can build roads with money from the budget of the Mechanism for the interconnection of Europe. This project has 26 billion euros available between 2021 and 2027 for transport, energy, and digital infrastructure projects. Moldova is the first country outside the EU to become part of this mechanism. Unlike the EU member states, the Republic of Moldova will be exempt from the financial contribution necessary to access funds within the project. 

In 2023, three agreements regarding the construction of three bridges over the Prut River were signed between the Republic of Moldova and Romania. Several road segments renovated with the support of the EU and development partners were launched during the year. In the last ten years, the EU, the EIB, and the EBRD have invested more than one billion euros in the modernization of more than 900 km of road and railways.

Increased safety for citizens. The Republic of Moldova has become part of the European network of rescuers

After receiving full support from EU member countries in the context of the multiple crises generated by the COVID-19 pandemic and Russia’s war of aggression in Ukraine, Moldova was granted the status of a member of the EU Civil Protection Mechanism. The agreement signed in the fall of 2023 will enter into full force on January 1, 2024. During the year, 30 hospitals in the country received 36 generators worth 2.8 million euros through the Civil Protection Mechanism. Since the start of the war, the Republic of Moldova has received 80 generators, worth 3.8 million euros. The value of the humanitarian aid received so far has exceeded the amount of 48 million euros.

Protected cultural identity of the Republic of Moldova. Several architectural monuments were renovated

Landmarks of cultural heritage retain their authenticity thanks to the support of the European Union. At least 6.4 million euros were invested in cultural heritage conservation. The works of the Soroca Fortress were estimated at 3.2 million euros, which included the strengthening of the fortress walls, the 12 casemates, and the terraces. Also in 2023, the conservation works for the Chisinau Circus building began (1.8 million euros) and the conservation works for the Tighina Fortress (1.4 million euros) were completed. Another 10 monuments on both banks of the Dniester, along with the Tighina Citadel and the Circus in Chisinau, were rehabilitated through the “Confidence Promotion Measures” program, financed by the European Union and implemented by the UNDP.

Sustainable media with EU support

Media institutions and journalists from the Republic of Moldova benefited from grants, mentoring and training, aimed at boosting the development of an independent media, capable of delivering truthful and high-quality information for its citizens. More than 9 million euros were invested in independent media, combating disinformation and cyber security. About 40 media institutions benefited from the support of the European Union.

Since the fall of 2021 until now, the European Union has invested at least 1.2 billion euros in reforms and resonant initiatives in the Republic of Moldova.