oDR: Opinion

How Russia is seizing on discontent in Moldova

Moldova imports 100% of its gas from Russia – and price increases in recent months have led to widespread protests

Evghenii Ceban
6 October 2022, 3.24pm

September 2022: Anti-government protesters in Chișinău

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(c) REUTERS / Alamy Stock Photo. All rights reserved

In recent months, as gas prices in Moldova have soared and the country’s inflation has hit a record high of 34%, public discontent has grown. There are now virtually non-stop protests on the streets of the capital, Chișinău, and Moldova’s pro-reform, pro-EU government has taken a serious beating in the opinion polls.

One figure from the country’s recent scandalous past has sought to capitalise on the uneasy political situation – seemingly with assistance from the Kremlin. That man is Ilan Shor, a politician and businessman who was convicted for his role in Moldova’s ‘theft of the century’, when $1bn were removed from three of the country’s top banks.

The eponymous Shor Party has been organising the current protests, and recent communication between Russian politicians and Shor and his MPs – as well as the transfer of control of Moldovan media companies – have led many to believe the Kremlin is supporting his efforts to at least cause friction for President Maia Sandu’s administration.

A backdrop of anger

Earlier in the summer, Moldova’s political rumour mill was ablaze with the idea that Moscow wanted to shake up the country’s political scene – it was said that pro-Russian forces wanted to take advantage of the high levels of public dissatisfaction with the government.

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Indeed, Russia’s war on Ukraine has put pressure on Moldova, sparking fears that the conflict with Transnistria, a Russian-backed Moldovan breakaway region that borders Ukraine, could reignite.

Pro-Russian sentiments are traditionally strong among the Moldovan public. While Moldova has welcomed significant numbers of Ukrainian refugees, opinion polls suggest a significant cohort of people believe that the invasion of the Russian army into a neighbouring country can be justified. In Moldova, there’s also a strong current of opposition to Moldova’s possible accession to NATO, while Western states have provided military assistance to Moldova over fears Russia’s war could reach the country.

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The road crossing between Transnistria and Moldova was blocked earlier this year after “terrorist attacks” were reported in the breakaway region

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Image: News from Transnistria / Telegram

But the main cause of unrest in Moldova is the price of natural gas – which has risen sevenfold since 2021. All of the country’s gas is bought from Russian state company, Gazprom, leaving Moldova reliant on Russia. The severe price hike is in retaliation to Moldova’s historic gas debts, with the

Moldovan authorities having not yet come to an agreement with Gazprom on debt repayment.

The Moldovan government has been reproached – at the suggestion of Moldova’s pro-Russian opposition parties – for its inability to agree a more acceptable price with Gazprom and the Kremlin.

Against a backdrop of rising fuel costs, war and economic downturn, the approval ratings of the ruling Action and Solidarity party (PAS) – which opposes the war – have dropped by at least 15% since Moldova’s parliamentary elections in 2021. The ratings of the party’s leader, Sandu, have also fallen.

This discontent has created the potential for large-scale protest, a potential that until recently no one had been able to fully exploit. This is in part due to the Socialist Party, significantly reducing its activity – with deputies quitting the party – since its informal leader, former president Igor Dodon, was placed under house arrest on charges of corruption and treason in May.

This is where Ilan Shor saw the opportunity and stepped in to lead the unhappy mob.

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September: Fugitive politician Ilan Shor addresses protesters in the Moldovan capital

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Image: Shor Party

Who is Ilan Shor?

The apparent new leader of the Moldovan opposition has a storied biography.

After inheriting a family business, Shor gained wealth, power and connections in the early 2010s. But Shor’s career seemed set to come to an end in 2014 over the billion-dollar bank theft, which left Moldova in a terrible financial situation and caused widespread protests after three banks, including the Banca de Economii – where Shor sat on the board – lost millions of dollars in huge loans.

In 2015, a US investigative consultancy hired by the National Bank of Moldova concluded the beneficiaries had been companies linked to Shor’s businesses, and he was placed under house arrest. Yet shortly after, Shor launched a massive election campaign and was elected as mayor of the city of Orhei, north of the Moldovan capital.

Today – despite having been convicted of fraud in 2017, which he denies and is still appealing – Shor is an MP, and Orhei, where a member of his party is now the mayor, is used by his team as an example of successful management. The city was given a new urban design and landscaping, and social provisions for city residents were improved.

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The town of Orhei, north of Chișinău, has become a base - and a model - for for Ilan Shor's political party

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Image: Shor Party

Still, Shor fled the country after his conviction and has been living in Israel in recent years. This has not prevented him from using social media and press releases to maintain his connection to his target electorate in Moldova, who are generally elderly and socially vulnerable people.

But outside of this voter base, which is unlikely to ever exceed 10-15% of the total electorate, Shor is an extremely unpopular politician. None of the opposition parties has yet joined his protests – including the Communist Party, which actively collaborates with Shor. Even the Socialist Party ignored Dodon’s calls for members to take part.

New leader

Today, the Russian state’s top propagandists call Ilan Shor ‘the pro-Russian leader of the Moldovan opposition’. Only a few years ago, though, Shor was banned from entering the Russian Federation, just as he started having problems with the law in Moldova.

The public side of Shor’s rapprochment with Russia began last month, when deputies from his own political party and Moldova’s Communist Party became the first Moldovan politicians to visit Moscow since the beginning of the war in Ukraine. According to the Shor Party, the deputies discussed Russian gas prices – a point of serious tension between Moldova and Russia – and the export of Moldovan agricultural products to the Russian market.

“We should find a consensus on gas supplies at an affordable price with the Russian Federation, a strategic partner of Moldova,” Shor said in August.

In Moscow, the deputies were received by Leonid Slutsky, chairman of Russia’s parliamentary committee on international affairs. Later, Shor published a letter he received from Slutsky, who was promising to help the Orhei region with a preferential price for gas and exporting Moldovan agricultural products to Russia. Slutsky later called the Shor Party a “reliable partner” for Russia.

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Ilan Shor holds a video call with Leonid Slutsky

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Image: Shor Party

Then, in mid-September, two prominent journalists from Russian state-controlled TV channels, Vladimir Solovyov and Margarita Simonyan, announced their support for the Shor Party’s protests in Chișinăuin in their Telegram channels. Since then, Shor’s Moldovan protests have been heavily covered in Russian state media.

Weeks later, journalists discovered that two Moldovan TV channels had come under the control of Ilan Shor. The channels, Primul in Moldova and Accent TV, had previously been controlled by Dodon, the head of Moldova’s Socialist Party who had been heavily backed by the Russian state during his presidency. Primul in Moldova broadcasts content from Russia’s leading state channel Pervyi kanal, or Channel One.

At the same time, an advertising company that sold advertising for the Moldovan segment of the Russian social networks Odnoklassniki, VKontakte and Mail.ru also came under the control of Ilan Shor’s team.

The hardest winter

The colder it gets in Moldova, the higher the chances of protests. The gas tariff in Moldova is twice as high as last winter, heating tariffs have increased by 40-50%. Vadim Ceban, the head of Moldovagaz, the country’s gas supplier, said the public should not expect the tariffs to be reduced this winter. The government is working on a compensation system for citizens who cannot pay their bills, though the details of this are not yet known.

Moscow can fuel the Moldovan protest from a distance. Gazprom has the right to terminate the contract for Russia’s gas supplies to Moldova, and has threatened to do so if Moldova does not settle its debts by 20 October.

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Ilan Shor has admitted to paying September's protesters for "food and transport"

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Image: Shor Party

Moldova has already missed one of Gazprom’s deadlines, having failed to sign an agreement on debt repayment by 1 October. This resulted in Gazprom reducing Moldovan gas supplies by a third, though the company claimed the supply shortage was due to Ukraine's refusal to accept Russian gas at one of the entry points to its own gas transit system.

The main reason why Gazprom is in no hurry to turn off gas to Moldova is by no means commercial. Under a 2000s-era scheme, Gazprom supplies gas to Transnistria for free – which is Moscow’s main instrument of influence on the administration in the breakaway region – and the company would not be able to do so bypassing Moldova’s gas network.

But even a short-term shutdown of Russian gas or a significant reduction in volumes is painful for Chișinău. The missing gas will have to be sought in other markets, at two or three times the price. The same is true for electricity. About 70% of Moldova’s electricity is produced by the Moldovan hydroelectric power station which is located in Transnistria - and runs on cheap Russian gas.

Public fears about the reliability of gas and electricity supplies do not bode well for the Moldovan authorities, and a new increase in energy prices may result in people not being able to pay their bills.

Moldova is in for a very difficult winter. Perhaps the most difficult in decades.

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