Does Moldova Need Regional Development?
A regional development policy begins with the decision of a national government to provide additional support to less developed areas of a country. Everywhere in the world, even in the richest countries, disparities in the development levels of various regions exist. These disparities are generated by various geographic, historic, economic, social and cultural factors. The governments all over the world intervene to reduce these disparities by focusing additional resources and investments into these disadvantaged regions.
Development disparities among regions exist in Moldova as well, the most pronounced one being between Chisinau Municipality and the rest of the country. The Moldovan government has made the political commitment to support the less-developed regions via the regional development approach. This commitment is reflected in its key national policy documents, such as the Partnership and Cooperation Agreement (art. 67), Economic Growth and Poverty Reduction Strategy (ch.6.10), and Moldova-EU Action Plan (ch.22).
Beside an acute need for a regional development policy in Moldova, its mere existence can secure access to a great amount of international donor funds. Many donors, including EU, UK and Japan, are aware of the effectiveness of the regional development approach, and are willing to make significant financial contributions via a regional development institutional infrastructure.
Therefore, the next thing the Moldovan government must do is develop and implement the most appropriate regional development policy. Although efforts have been made during the last three years, the country cannot report any significant achievements. The recently created Ministry for Local Public Administration has been charged with this mandate. The world experience in regional development is huge, so everyone genuinely interested in regional development has the opportunity to learn from this pool of readily-available knowledge.
Comments:
I hope you can help Moldova with regional development.
A regional policy is a good tool in eliminating regional disparities only if it addresses the issue to its bone. In my view, a regional policy is not a universal solution in eliminating poverty and economic problems, as it is considered in EU these days. Very often, in rush to distribute and/or accept funding both EU institutions and states step over simple principles of worldly recognized good governance and accept “fashionable” models of development. Thus, it is easy to get access to international donor funds.
For a regional policy to be truly successful in my view a few pre-conditions should exist. First, and most important – the country (territorial unit) should have “logical” regions. So, far I did not find a universal definition as to what regions are. You can find dozens of definitions of regions and regionalization, geographical boundaries and number of population being just a few distinctive features of these definitions. But there is no common opinion on a list of features that characterize “regions”. More than that, I come to think that regions artificially created sooner or later fail to exist. A glance back to the “greatest and powerful” Soviet Union makes me think that what was not to be there just dropped off the system. What is natural (nurtured through history) tends to last longer. As far as Moldova goes, I would have a hard time to distinguish any regions within the country. Moldova could serve as a region itself, a one NUTS 2 region.
Second, a truly working local economic development policy should exist. Before proceeding with regional development, in my view it is more logical to address the local development first. These two processes are not exclusive of each other. Both local and regional development could be implemented in parallel. Though a serious consideration should be given to developing and testing of a system of mechanisms, which can be applied for local and regional levels. Moldova lacks a local development integrated strategy. When there is zero local development and no future plans for improvement a regional policy is just an “on-shelf” tool.
Last but not least, decentralization with a good horizontal equalization formula should be put in place. Until the law on decentralization is approved by PoM and implemented in Moldova, regionalization and regional development make little sense. Moldovans are still trying to distinguish between the functions of “raions” – another form of region existing here for ages, and local authorities. Add to this the functions of the regional bodies, and a long lasting confusion will be guaranteed. I fully agree with Lucia that disparities in Moldova exist – but rather political than regional. Chisinau plays a disproportionately dominant political and economic role in the country. Its economic indicators make up the economy of Moldova. The largest gaps in development are not among regions or towns in Moldova, rather between Chisinau and the rest of the country. In view of the existing problems, Moldova still did not find a proper horizontal equalization formula. If such existed, then municipalities with greater need for resources would have had access to additional funds without necessarily competing for the regional development funds.
And in the end I’d like to add a few thoughts about regionalization as a concept in general. I am in favor of regions but within federal states (USA, Russian Federation) or in unions of countries, such as EU. Regions, as they exist now in most European countries serve only a partnership role. In these countries raions (counties) and municipalities – both possess democratic legitimacy and have true public administration functions. This is not true about regions. The paradox is that both raions and municipalities, and the latter in a greater sense, lack funding and authority to conduct capital investment for regional development. They have least authority and not even own resources with which to conduct regional development. At the same time, National and regional development councils through the regional development funds control the funds for which municipalities, private business, NGOs have to compete.
The central government through its designated ministries, in Moldova this is the Ministry of Local Public Administration, dominate the regional development bodies and may decide over the allocation of funds and supervise them. While municipalities are in constant position of grant seeking even though their plans may reflect the true cross-sectoral and citizens’ interests