In short
On February 12, the European Parliament approved a €1.9 billion support package to help Moldova deal with its challenges and ongoing crises.
The halt of Russian gas transit through Ukraine on January 1st 2025 worsened Moldova’s economy, while breakaway region Transnistria plunged into crisis due to the loss of free Russian gas. This has caused shifts in the regional dependencies and relations.
Continued EU support is crucial for Moldova’s ability to deal with its many challenges, while keeping a critical eye on the country’s progress in the reform process.
The EU should seize the opportunities that the shifting regional dynamics provide, to help unfreeze a long-standing conflict on its outer edges, over Transnistria, and help move it towards a path of resolution.
EU candidate Moldova is facing economic challenges this year with the ceasing of the Russian gas transit through Ukraine. Its breakaway region of Transnistria, however, is in much bigger trouble, considering its overwhelming dependency on free Russian gas. This alert analyses these developments and their (potential) political consequences for regional relations, and suggests courses of action for the EU and the Netherlands.
Out in the cold
On January 1st 2025, Russian gas deliveries to Moldova stopped with the expiration of the transit agreement between Russia and Ukraine. As Ukraine had been warning, for some time, that this scenario would occur, most European countries were able to prepare for and cope with the resulting disruption. Moldova is the notable exception, although not for a lack of trying: since 2022 the country has diversified its energy supplies away from Moscow, with the only gas imported from Russia going solely to the breakaway region of Transnistria. Chisinau nevertheless remained indirectly dependent on Russia’s supply, as it bought up to 80% of its electricity from Transnistria, where it was produced using Russian gas.
The ceasing of the gas transit has brought Chisinau severe economic difficulties, having to shift to more expensive energy providers. But for Transnistria it has meant a crisis of downright existential proportions. Its population was left with no heating and rolling blackouts during the year’s coldest months and its energy-intensive industry practically came to a standstill. The effects on Transnistria’s economy are devastating. With the cutting of this exceedingly important Russian lifeline and the uncertainty it brings to Transnistria, the region’s potential dependency on Chisinau (and by extension, the EU) is increasing, resulting in shifting relations between Tiraspol (Transnistria), Chisinau, Moscow and Brussels. This presents opportunities, threats and dilemmas for all parties involved. First, however, it is important to understand how we arrived at this juncture.