DCFTA, Transnistrian region and Rogozin’s visit to Chisinau

Op-Ed
	The Russian authorities will try to condition the return of the Moldovan goods to the Russian market in the future ‘roadmap’ by forcing the official Chisinau to make concessions related to the implementation of the Russian technical regulations, in parallel with the European ones. The Russian side could also include in the ‘roadmap’ provisions about the Transnistrian region, which would influence the future application of the DCFTA in the region...
Dionis Cenuşa

The implementation of the components of the Deep and Comprehensive Free Trade Agreement (DCFTA) with the EU in the Transnistrian region was absent from the speech of the Deputy Prime Minister of Russia Dmitry Rogozin during his July 5-6 visit to Moldova. This omission is unusual given the permanent anti-European rhetoric of Moscow and this thus arouses questions. At the end of 2015, the EU confirmed that the DCFTA will be applied all over Moldova, including in Transnistria. The Europeans’ decision was preceded by a technical agreement between Brussels, Chisinau and Tiraspol.

The exact text of the agreement wasn’t made public, but the Moldovan institutions provided fragments of the official messages by which they explained that the technical agreement lays down a series of conditions inspired by the DCFTA that were accepted by Tiraspol. Only by meeting these conditions will the Transnistrian companies be able to benefit from free access to the European market. Among these conditions are to eliminate the import duties on EU goods, to ensure Moldovan authorities’ access to the exporting companies for inspection purposes (as civilians, but by fulfilling the professional functions), to meet the technical and sanitary and phytosanitary requirements, etc. A major role is to be played by the EUBAM Mission whose mandate was prolonged until November 2017, but with extended powers that include the provision of assistance in implementing the DCFTA (customs procedures, respect for the intellectual property, etc.).

Transnistria’s exports to Russia decreased drastically from 40% in 2005 to 8% in 2016, while exports to the EU rose from 20% in 2005 to 32% in 2016. That’s why the intentions related to the eventual implementation of the DCFTA, promised by the Transnistrian administration, should have caused harsh reactions on the part of Moscow. But Deputy Prime Minister Rogozin ignored this subject. However, Rogozin alluded to the possibility of including particular provisions concerning the Transnistrian region (“lifting of the economic blockade” that is actually inexistent) in the future “roadmap” for restoring the Moldovan-Russian commercial relations. These aspects could be related to elements of the DCFTA.

Why did Rogozin omit the subject of the DCFTA?

Assessing the messages disseminated by the Russian Deputy Prime Minister during his visit to Moldova, including the separatist region, we ascertain an abundance of messages about Russia’s assistance for social projects, the Russian peacekeepers and in strengthening the direct economic relations between Tiraspol and the Russian regions. By these messages, Rogozin reminded Tiraspol of the place of the Transnistrian region in the geopolitical equation of Russia, where this is seen as an integral element of the ‘Russian world’ (Russian civilization).

In this conglomerate of subjects, the possible implementation of the DCFTA was omitted. This apparent lapse of Rogozin does not seem an accidental omission as the Russian official always takes the opportunity to criticize the European initiatives, especially when these cover the territories from the Russian geopolitical areas.

The DCFTA is something useful. The first explanation is the fact that the Russian companies that work in the Transnistrian region want to keep the access to the European market. Thus, a pragmatic approach that belongs to the Russian economic elites prevails. This could influence the rhetoric of Rogozin, who usually vehemently criticizes any European initiative. Moreover, the region survives owing to the exports to the right bank of the Nistru River and, respectively, to the EU. That’s why it would be suicidal to reject important trade preferences for the separatist region’s economy and for the Russian investors.

The DCFTA promised as non-implementable in the region. The Transnistrian administration closely consulted with Moscow all the steps related to the implementation of the elements of the DCFTA. Consequently, the Russian authorities feel comfortable and do not need to exploit the subject now. Probably, there is a conviction in Moscow that the commitments assumed by Tiraspol before Chisinau and Brussels will remain on paper. This will happen immediately after the elections that will take place in the region.

The DCFTA and the critical context in the region. It is also possible that the Russian authorities anticipate the EU’s reaction to the situation when the implementation of the DCFTA is undermined. But Moscow realizes that Tiraspol is weakened by the socioeconomic, currency and political crises. That’s why Russia can for now take no action against the implementation of the DCFTA elements in the Transnistrian region.

Russia’s reasons could be yet mixed, which means that this cannot be categorically against the DCFTA elements. The current specific features of the region’s economy, its dependence on the European market and the right bank of the Nistru and the interests of the Russian investors are taken into account.

Moscow wants greater integration of the Transnistrian region into Russia?

Deputy Prime Minister Rogozin, who is the special representative of the President of Russia for the Transnistrian region, underlined that the Russian interests in the region remain as powerful as earlier. He noted that owing to the Western sanctions, Russia cannot offer more assistance to the region. A similar justification was used by Russian Prime Minister Dmitry Medvedev, when he visited the Ukrainian Crimea that was annexed by Russia in 2014.

The implementation of the elements of the DCFTA in the Transnistrian region, which will necessitate assistance on the part of the EU, as other projects carried out in the region with European funds (reconstruction of schools, kindergartens, etc.), create benefits for the population. At the same time, these initiatives intensify the contacts between the Transnistrian administration and European officials. These moves do not represent a threat to Russia’s positions in the region, but are anyway disliked by Moscow.

Moscow wants to intensify the ties between the Transnistrian region and Russia, in addition to the socioeconomic, cultural and identity ones (‘Russian world’, issuing of passports to the population, discrimination in favor of the Transnistrian exporters, etc.). Rogozin’s proposal to organize internships in Russian central and regional institutions for officials from the Transnistrian administration, for up to four months, results from this pragmatic approach. At the same time, the Russian Deputy Prime Minister insisted on a more visible economic connection between the Transnistrian region and the federative units of Russia. On the one hand, this will increase the integration of the business community into the Russian economy. On the other hand, this will diminish the region’s dependence on the European market.

Instead of conclusion

The economic recovery in the Transnistrian region and its interconnection with the Russian regions could naturally eliminate the discussions about the importance of the European market for Tiraspol. This objective would satisfy Moscow.

However, the EU market remains attractive for the Transnistrian businesses and the Russian ones operating in the region, especially when the Russian economy is powerfully affected by the Western sanctions imposed on Russia because it destabilized the situation in Ukraine and violates the international law in relation to the Ukrainian territorial integrity.

Possibly, the Russian authorities will try to condition the return of the Moldovan goods to the Russian market in the future ‘roadmap’ by forcing the official Chisinau to make concessions related to the implementation of the Russian technical regulations, in parallel with the European ones. The Russian side could also include in the ‘roadmap’ provisions about the Transnistrian region, which would influence the future application of the DCFTA in the region.

The EU will not yet allow setting precedents in relation to the separatist regions from the countries that signed Association Agreements. The territorial application of the DCFTA is not negotiable even if some of the aspects can be adjusted. That’s why Tiraspol’s refusal to apply the ‘adjusted’ elements of the DCFTA will mean the annulment of the EU trade preferences, regardless of Moscow’s protest.

IPN publishes in the Op-Ed rubric opinion pieces submitted by authors not affiliated with our editorial board. The opinions expressed in these articles do not necessarily coincide with the opinions of our editorial board.