Moldovan parliament set to install new pro-EU prime minister

Reuters News
Posted: Feb 18, 2015 6:52 AM

By Alexander Tanas

CHISINAU (Reuters) - Moldova's parliament is expected on Wednesday to approve as prime minister 38-year-old businessman Chiril Gaburici, who promises to forge closer ties with Europe, despite fears of a possible Russian backlash.

The ex-Soviet republic is already suffering fall-out from economic turmoil in Russia, with the local currency tumbling against the dollar and former strong growth in sharp decline.

The country of 3.5 million, wedged between Ukraine and EU-member Romania, ratified a political and trade agreement with the European Union in July -- a move that means turning away from a future in a Russia-led customs union bloc.

Ahead of parliament's vote on Wednesday, Gaburici said European integration and complying with EU agreements would be a top priority for his government.

All would be done "to ensure that by 2018 the country can qualify to sign an agreement on associate membership in the EU," he said.

In Moldova it is the parliament which appoints the prime minister. Gaburici is the second candidate to be proposed after parliament a week ago rejected acting Prime Minister Iurie Leanca for a further term in office.

One of the poorest countries in Europe, Moldova has been ruled for the past five years by a pro-Europe coalition.

The pro-Europe bloc won again in parliamentary elections last November when Moldovans went to the polls aware that the separatist war in Ukraine was triggered by Kiev pursuing similar policies in the face of opposition from Moscow.

Moscow has already shown its displeasure by banning imports of wines, vegetables and meat from Moldova, a large part of whose economy relies on exports to Russia and remittances from workers based there.

Russia has also warned Moldova that its drive for closer ties to Europe could cause it to lose control of the breakaway pro-Russian enclave of Transdniestria for good, just as Ukraine lost Crimea, and lead to more costly Russian gas imports.

Moldova's finances are coming under additional pressure from the currency crisis in Russia.

The central bank has repeatedly hiked interest rates and sold nearly 10 percent of its foreign currency reserves since the start of 2015 to support the leu currency.

The leu has lost 25 percent in value against the dollar since the end of 2014, after weakening 19 percent last year. Moldova's economy, which grew 9.2 percent in 2013, is expected to have contracted by up to 2 percent last year.

(Writing by Alessandra Prentice; Editing by Crispian Balmer)