Findings from Transnistria, the frozen conflict zone between Moldova and Ukraine
In 1990–1991, Soviet Union’s military armies left the territories of the Eastern European countries which they protected. Some of these countries were independent (East Germany, Poland, Czech Republic, Hungary), some of them were part of the Soviet Union (Latvia, Lithuania, Estonia, the Moldavian Republic). There was one exception, the Russian 14th Army never left Moldavian territory reasoning that they protect the citizens of the Pridnestrovian Moldavian Republic (Transnistria). The conflict escalated into short periods of armed violence. So, now the oldest frozen conflict zone is a Russian army captive between two countries (Ukraine and Moldova).
From the Moldavian officials’ point of view, Transnistria is not an independent region, but a part of the republic. Within the Moldavian Republic there is only one officially recognized autonomous region, Gagauzia.
The surface is 4,163 square kilometers, the population is 469,000 (2018), and the most important city and capital is Tiraspol. The inter-ethnic language spoken is Russian. Transnistria has many of the features of an independent state including its own government, money (Transnistrian ruble), institutions, army, newspapers, car registration numbers and TV channels. Although the region has its own passport, it can only be used for identification within the borders, because the country and its ID are not recognized for international travel.
The full research study identified challenges and potential solutions throughout four main sections in Moldova: Education (Migration, Skills mismatch), Policy and Regulation, Financing (Distrust of banks, Corruption) and Geography.
However, I want to share some findings that were specific to Transnistria.
Initial Assumptions:
- There is support from Moscow in Transnistria. Russia pays the salaries of soldiers stationed in Transnistria, the salaries goes into local consumption, local businesses survive.
- Economic exchange between Transnistria and the Moldavian Republic is zero. Transnistria can survive with the sole support of Russia.
- English Language
English is the language of business throughout the world. In Transnistria however, English knowledge levels are really low. In these two regions Russian is the language of education and the common language among people of different ethnicity.
The Transnistrian businessman should speak: Russian, Moldovan/Romanian (in order to interact with Chisinau authorities), English (in order to access funding coming from European Union), and Ukrainian (to arrange transportation to the Black Sea ports).
Potential Solutions:
- Many of the eastern and northern European Member States were characterized by the fact that learning Russian was compulsory in the past. This situation has changed rapidly after introducing English language within primary education. In Estonia, Lithuania, Czechia, Bulgaria, Slovakia and Romania English language knowledge among students increased to 69 % — 85 % in 2016, and to more than 90 % in Poland and Latvia. Promoting multilingualism increased the economy’s competitiveness and people’s mobility and employability. Therefore, it is essential for Gagauzia and Transnistria to increase the offering of English courses and English-teaching initiatives.
- Offer incentives in order to cover the huge need for English teachers, ready to teach to Russian-speaking students.
2. Gender Balance
The research found a shift in the gender balance of the Transnistrian society. Historically, this society survived through the salaries of Russian soldiers, creating a gender balance gap. The women were not the driving economic factors in a family. However, more women decided to educate themselves to become linguists or teachers and, as a result learned English. In consequence, they are now in the front line of business avangarde, ready to communicate with foreigners.
Suggested further steps:
- These stories and examples of female success should be shared and replicated.
Additional Challenges of Entrepreneurship in Transnistria
The interviews showed that one of the additional challenges faced by Transnistrian entrepreneurs lays in understanding the legal structure of operation. They reported an increased difficulty in getting all the documents ready in order to receive a license.
Similar to Moldova, Transnistria cannot survive on its own. The trade deficit of Transnistria is financed through support from the Russian Federation. In the long-term, in order to grow and prosper Transnistria has to consider international trade. In order to do so, Transnistrian entrepreneurs need to register in both Moldova and Pridnestrovian Moldavian Republic and legalize all documents in both countries. This creates a huge barrier for start-ups.
Another notable issue is the competitive environment of the region. Elites from Sheriff Enterprises have forged an economic monopoly. They own supermarkets, petrol stations, a phone network, a football club, alcohol factories and even a car dealership. Therefore, depending on the industry entrepreneurs are trying to enter, small businesses might struggle to grow and scale.
Even more than Moldova, Transnistria offers a unique opportunity in the tourism industry. The breakaway region still houses many symbols of the USSR, from Lenin statues, streets with communist names, soviet tanks to abandoned factories. There is potential for attracting Russian tourists nostalgic for the Soviet period as well as Western and Eastern European curious young travelers.
Potential Solutions:
- Incentivize trade between Transnistria and Chisinau.
- Increase international adventure tourism. Create more regional transportation connections. At the moment, there is only one train from Tiraspol to Odessa and no connection with Romania.
- A widespread use of English language and a good marketing campaign on safety issues, would attract more customers and investors into the region.
Similar to the Republic of Moldova, Transnistria cannot survive on its own. The region requires support in order to develop. A widespread use of English language, a good marketing campaign on safety issues and better infrastructure for tourism and trade would attract more customers and investors into the region.
