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Moldovan President promotes stable, open economy

M oldovan President Petru Lucinschi doesn't just see the change his country has undergone since communism fell, he feels it.

Elected president in 1996, Lucinschi has not shied away from political battles with parliament to ensure Moldova's democratic reform and free-market economy remain intact. In doing so, he has found himself in the role of both politician and teacher, preaching the virtues of democracy and seeing that they were written into law. While President Lucinschi now embodies Moldovan democracy, this was not always the case. In June, 1990, before Moldova’s communist regime fell, he had risen to Secretary of the USSR Communist Party. Like many Moldovans, he was quick to capitalize on the change. By 1994, he had become a member of Moldova's democratically elected parliament and eventually was elected its chairman. As a reformed communist official, President Lucinschi says, he is even more committed to democracy and free-market economics than many of his constituents.

Moreover, he notes, he did not just reinvent himself to enjoy power in Moldova's new democracy. "I personally feel within myself with a more democratic mentality than many young people who both don't know the old system was, but are still affected by it," says Lucinschi, who holds a doctorate in philosophy. "And I can say that these democratic roots were present in the old system as well. The Soviet Union would not have collapsed without war if it did not have exponents that had the real desire to change things. It means there was an internal process that changed the society." At age 59, President Lucinschi is a driving force behind the irreversible democratic inertia needed to privatize the Moldovan economy. In a recent interview with The Washington Times, President Lucinschi detailed his views on Moldova’s economic prospects, its privatization plans, and its relations with Russia and the West. Following are excerpts from that interview:
TWT: Recently President Clinton called Moldova "a model of democracy for the entire region," and these comments have been echoed by other American officials. What has Moldova done to earn such praise?
Lucinschi: We have undertaken steps in two directions. In the first place, we tried to educate our population in the acceptance of world democratic values. This step was undertaken by all of the [Moldovan] states. This was done by the president and the president of the parliament, and there also was great support from non-government organizations and prominent personalities from various societies. They helped to create an atmosphere of understanding that the road to success for the Republic of Moldova is ensuring democratic principles. This atmosphere gave us the possibility to confirm it through our legislation. We adopted a series of documents that incorporate the democratic principles of the United Nations and European Community. We are proud of the fact that Moldova was one of the first CIS states to be accepted in the Council of Europe. So, the combination of the creation of this atmosphere and the legislative framework has given President Clinton cited Moldova as a model for the states of this region, though we look on this with a high amount of modesty. One other important policy measure I'd like to mention is the way we responded to Russia's financial crisis. When the crisis hit, we did not alter our economic reforms, our commitment to economic relations based on a market economy. On the contrary, we have accelerated the process. We were the only state of the former USSR that responded in this way. It is obvious that our policies have generated a stable and open economy.
TWT: What are your legislative priorities for 1999 to continue the path and environment of stability that you've just mentioned?
Lucinschi: There are a few directions in this aspect as well. The first one would be the real privatization process. What I'm talking about is a public, transparent privatization against hard currency and against cash, and, with it, attracting foreign investment. Our main goal is not just to sell the land or the enterprise or the industries to get money from it. Our main purpose is to find the real owner of this property. The second direction would be the complexion of the agricultural reform, and we are helped by the government of the United States in this aspect. The third key point is the reforming of the industry-to make the enterprises work, to make them function. Moldova has a very big industrial potential. Given the fact that Moldova became part of the Soviet Union after the war, the industrial bases were in place in Moldova after the sixties, and, in principle, our industry is young. We have qualified staff who are still able to perform qualified work. We have a goal to start the industry again, because it is industry that has the highest stake of GDP. Our internal needs would be satisfied if 30 percent of our industrial capacity could be working, and 70 percent could be exported. And we have the same situation in the agricultural sector. If we could apply modern technology and equipment in the agricultural sector, we could export 70 percent. Have you heard the specifics of the Moldovan soil?
TWT: No, but it must be very rich.
Lucinschi: Here's what I want to say. In the whole world there are many different types of soil. Red soil, sand soil, and clay-but the richest soil is the black soil. Due to this Moldova can produce the pure ecological product, and there are only 16 countries in the whole world that have this type of soil: Russia, Romania, France, California, and the Ukraine. But 75 percent of Moldova's territory is covered with black soil. Ukraine has 30 percent and Russia has 8 percent. Our researcher and scientist tell us that our country will become a national reservation in 10 years, where only in this territory you could raise pure biological products--and this territory would have to be maintained.
TWT: What has been the psychological impact on the population of the collective farm movement?
Lucinschi: What we are concerned with is the results. The farmers are joining farm associations, but they don't have the equipment to work the land with. The equipment during the last nine years has become very bad. We don't have fuel. We do not produce mineral fertilizers. We don't have chemicals used to fight diseases as well, and we are in need of special services. So, psychologically, we donŐt have problems. The people are welcoming the privatization of land. But at the moment, they are not satisfied with the situation which I have just described to you.
TWT: What do you hope to accomplish at the NATO summit in Washington?
Lucinschi: I don't know that this will be an opportune time to press our objectives. As things stand now, the major international institutions, NATO, OSCE [the Organization for Security and Cooperation in Europe], the United Nations and other international structures, tend to involve themselves when tensions reach the point of warfare. Enormous amounts of money are spent, and human lives are lost. What I would like to see is involvement by these institutions before tensions boil over. We would like to build structures that could defuse difficult situations before they get out of hand. This would take a lot of thought and ingenuity, but it would contribute enormously to the cause of international peace.
TWT: Just as President Clinton said that Moldova was a model of democracy, he also said that Transnistria is a threat to the stability of the entire region. In further conversations with American officials, there seems to be concern that Transnistria has become a kind of no-man's land-a place where anything can be bought and sold, and a place that potentially could fuel violent regions of the world through indiscretionary weapons sales. Yet at the same time, there doesn't seem to be a collective world effort to intervene in the conflict with Transnistria. Would you like to see the world community, particularly Washington, take a more active role in seeing that the Russians honor their commitment to withdraw troops?
Lucinschi: As I can see you have quite sufficient information, and I would like to tell you what the problem in Transnistria is. A lot of things you have said-they are really like that. We have guarantees from Ukraine, Russia and the OSCE for the settlement of this problem, but things are moving quite slowly. I would suggest in the same context as I was saying with the prediction of conflicts, that the influential countries--the United States, France, Germany and Ukraine--sit down and make an opinion in this regard, because all of our efforts to involve other countries in this havenŐt generated any real activity. We were always told to be the ones to make the declaration. We do make those declarations, but you can see that we live in a very densely populated region of Europe, and this uncontrolled part has to be somehow solved. Unlike the Serbs, we are very flexible in determining the level of autonomy of this region. In this context I am pretty sure that I will have a few meetings with the leadership of Russia and Ukraine in the foreseeable future, maybe even before the NATO summit in Washington. And if we don't succeed, we will make new attempts to enlarge the number of states involved in this issue. But we have to be sincere and realistic, and I would like to say that the success of this process is that during seven years there hasn't been a single gunshot.
TWT: Has Moldova's participation in NATO's Partnership for Peace program, and your efforts to redirect your trade away from Russia caused tensions with Russia?
Lucinschi: No, I don't see any of this as a source of conflict with Russia. Actually, Russia is not very satisfied that we have a positive trade balance with Russia. We export more with Russia than we import from them. Diversification of the market is obvious. We can not have 65 percent of our exports going to Russia, because the allowed limit is 30 percent.
TWT: What kind of message would you like to send to potential U. S. investors?
Lucinschi: The first thing I'd like to say is that it would be very good if they would come here and just get to know us. Second, they can rest assured that our political direction will continue. Our legislative guarantees are firm. Investors will be able to manage their investments in an efficient manner, and they will have a very reasonable return on their investments. Certainly I hope they will talk to other Americans who are already working here. You will hear from them that working conditions are good, and that the investment climate is excellent.

Table of Contents

(1) Moldova: a 'model of democracy'

(2) Moldovan President promotes stable, open economy

(3) Moldova- at-a-Glance

(4) Entrepreneur Prime Minister hopes to build prosperous Moldova
Economic globalization is Ion Sturza's recipe for success

(5) Moldova - a country in bloom

(6) Chisinau: Sacramento's sister city to the East

(7) Investment opportunities abound
Moldova goes out of its way to attract foreign investment

(8) Moldova's telecom giant seeks privatization

(9) Agricultural sector modernizes

(10) Moldovan tobacco courts investors

(11) Banks: bulwark for tomorrow

(12) How Moldova's banks withstood the Russian crisis

(13) Women leaders in Moldova

(14) A small country with many delights

(15) Why invest in Moldova?

(16) Wine is king