How did Moldova become a ”captured state”?

Any mechanism proposed for dismantling the state capture should guarantee the demolition of the created system and should also hinder any other oligarchs or groups of interests from exploiting the defects of Moldovan democracy …


Closer to the end of 2014, the expression “state capture” became a kind of country brand for Moldova. The extra-parliamentary opposition regularly used this phrase to describe the defective governance and infiltration of obscure interests into the government. The foreign development partners, with very small exceptions, used more veiled formulas when they spoke about “state capture” in Moldova so as to avoid a direct confrontation with the Moldovan authorities, which would have led to the imminent short-circuiting of the dialogue. Consequently, these used the “powerful politicization of institutions” as an equivalent.

The idea of state capture was assimilated by the public opinion much easier amid the crisis in the banking system unveiled at the end 2014. This way the phrase became a very popular jargon in national journalism. Other criminal activities committed in the period of the so-called pro-European governments (2009-2016), alongside the thefts in the banking system, also started to be associated with the phenomenon of “state capture”.

Habitually, state capture in Moldova is attributed to the leader of the Democratic Party (PDM), controversial businessman Vladimir Plahotniuc. Accusing him of complicity in state capture, the opponents call him “puppeteer”. Namely for this reason, the protests mounted by the pro-European and pro-Russian opposition (RFI, October 2015) in 2015-2016 featured primarily Vladimir Plahotniuc. Ex-Premier Vlad Filat referred to the implications of the “puppeteer” in his last speech in Parliament, before his arrest in October 2015.

In the stiff competition between different political camps, the notion of “state capture” was maximally narrowed and is often applied in inappropriate contexts or is attributed exclusively to Vladimir Plahotniuc. Many journalists and politicians use it erroneously, in a meaning that is far from its original meaning.

What is actually “state capture”?

The phenomenon of “state capture” was defined in a more detailed and reasonable form by the International Monetary Fund. According to this, state capture is a form of grand corruption in transition economies that consists in the efforts of firms to shape the laws, policies, and regulations of the state to their own advantage by providing illicit private gains to public officials. In these countries, so-called oligarchs manipulate policy formation and even shape the emerging rules of the game to their own, very substantial advantage. According to IMF and EBRD assessments of the end of the 1990s, Moldova was among the most captured states, immediately after Azerbaijan (CIDOB, March 2016), outstripping Russia and Ukraine. These assessments centered on the perceptions of the business sector in the ex-Soviet countries of Europe and Central Asia, including former Yugoslavia and countries of the former Socialist block.

So, Moldova is by far not the only country that witnesses aspects of the captured state. This phenomenon is manly evident in countries that gained their independence relatively recently and where political corruption is more powerful than the democratic institutions (elections, rule of law, etc.) that are in a slow process of formation.

However, Moldova is different from the other countries. This is due to the fact that the most important political decisions here are taken by one group of interests, associated usually with the captured state. Thus, there is no competition between different groups of oligarchs and they are not visibly separated from the state here.

When did “state capture” appear in Moldova?

The IMF and EBRD data clearly show that the phenomenon of “state capture” didn’t appear together with or because of Vladimir Plahotniuc. It is a consequence of the unsuccessful transition to a really functional democratic state. In other words, this form of corruption, where oligarchic groups unite and then control the political class, existed in Moldova before the banking crisis. This phenomenon existed during the Communist government (2001-2009) and the government coalitions led by the Filat-Plahotniuc duo (July 2009 – October 2015) (IPN, October 2016).

State capture during the practically solitary government by PDM and, respectively, Vladimir Plahtoniuc, is yet different from what was there before 2015.

On the one hand, unlike Vladimir Voronin, Plahotniuc didn’t derive from conventional political systems. He entered politics after he survived the natural selection of 1990s, when a large number of businesses from outside the public sector were accompanied by criminal or semi-criminal activities.

On the other hand, after the counterweight ensured by Vlad Filat (in 2015), who was also a beneficiary of the phenomenon of “state capture”, disappeared for good, the mechanism of taking decisions in the state was fully taken over by Vladimir Plahotniuc via the PDM and other “political satellites”. Through the massive concentration of the political power in the state by one player, the phenomenon of “state capture” in Moldova reached considerable proportions, endangering the development of the democratic institutions and favoring afterward political destabilization.

Why do foreign partners avoid expression “state capture”?

For the first time, “state capture” in Moldova was addressed by Thorbjorn Jagland, Secretary General of the Council of Europe, in an article published in The New York Times in August 2015. After depicting the extremely serious effects of Moldovan corruption, the European official wrote that the captured state should be returned to the people.

Neither earlier nor after this, did an official of such a high rank speak about Moldova in such terms. What followed was an indirect approach to the phenomenon of “state capture”, namely by requirements related to the de-politicization of the state institutions. Thus, the Conclusions of the Council of the EU of February 2016 included politicization of institutions in the series of problems on whose solving, which was assumed by the Government of Pavel Filip, the unlocking of European assistance for Moldova depended. The same year, the representative of the European Commission reiterated that the politicization of institutions should be eliminated. (IPN, October 2016).

Nevertheless, the Western officials are trenchant when they speak about state capture in Moldova only in informal discussions. This way, the open hostilities between Chisinau and the foreign partners are avoided. Instead, these more often and more insistently seek the de-politicization of institutions, for now without imposing strict conditions related to the external financial assistance.

Instead of conclusion…

State capture in Moldova should not be treated strictly through the presence of the PDM and Vladimir Plahotniuc in power. These are the symptoms and causes of the democratic system that suffers from serious unbalances.

If the sources of these problems are not removed, there is a risk that history will repeat and Vladimir Plahotniuc will be replaced by someone else, who has similar intentions. Any mechanism proposed for dismantling the state capture should guarantee the demolition of the created system and should also hinder any other oligarchs or groups of interests from exploiting the defects of Moldovan democracy.