MOLDOVA

NATURAL ENVIRONMENT: Moldova is a landlocked country that covers an area of about 33,700 sq km. It was the second smallest republic of the former USSR, after Armenia. The terrain of Moldova is primarily a hilly plain interspersed with deep river valleys. The average elevation is 147 m above sea level. The Kodry Hills occupy the central portion of Moldova, rising to a maximum elevation of about 430 m at Mount Bălăneşti. Moldova contains an extensive river system; more than 3,000 rivers and streams traverse the country. The two largest rivers are the Dniester and the Prut, both of which rise in the Carpathian Mountains in Ukraine, to the north of Moldova. The Dniester, the larger of the two rivers, flows through the eastern portion of Moldova in a southeasterly direction. It forms part of the country’s border with Ukraine in the northeast, cuts through Moldova’s interior, and meets the Ukrainian border again in the southeast, where it reenters Ukraine and then empties into the Black Sea. The Prut, a major tributary of the Danube River, forms Moldova’s entire western border with Romania. At the extreme southern tip of Moldova, the Prut joins the Danube, which flows eastward and empties into the Black Sea. Other major rivers include the Yalpug, the Byk, and the Reut. The hills in the central portion of Moldova are densely forested, mostly with oak and hornbeam trees. Linden, maple, beech, and wild fruit trees also grow in Moldova. Cultivated crops have largely replaced the natural grass cover of the plains, or steppes, in northern and southern Moldova. Grassy salt marshes are common in some river valleys. A wide variety of wildlife inhabits Moldova, although the population of certain animals, such as wolves, has declined dramatically during the last century. Roe deer, which are native to the region, are abundant. The spotted deer, which was introduced to Moldova, is also well established. Members of the weasel family, including badgers, martens, ermines, and polecats, are common. Other mammals include wild boars, foxes, and hares. Common birds include larks, jays, and blackbirds. Some species, such as the wild goose, are migratory. Natural resources in Moldova include deposits of lignite, phosphorite, and gypsum. Three-quarters of the country is covered in chernozem, an exceptionally fertile type of soil that is ideal for agriculture. The environment of Moldova suffered extreme degradation during the Soviet period, when industrial and agricultural development proceeded without regard for environmental protection. Excessive use of pesticides resulted in heavily polluted topsoil, and industries lacked emission controls. The Moldovan government is now burdened with the Soviet legacy of ecological mismanagement. Environmental initiatives are administered by the State Department for Environmental Protection. High levels of pesticide and fertilizer use have been linked with elevated rates of disease and infant mortality. Soil contamination and groundwater pollution are associated problems.
ECONOMY: Moldova’s rich black soil makes agriculture the foundation of its economy. When Moldova was part of the USSR, Soviet central planners made its primary role one of supplying food products to the rest of the Soviet Union. The Moldovan economy suffered from the disruption of trading relationships following the breakup of the USSR. The conflict in the Trans-Dniester region greatly compounded the economic turmoil. Moldova’s light industry, which is highly dependent on trade outside the republic, suffered the most. Moldova has survived many of the most severe hardships of its transformation to a free-market economy; however, the country’s economic vitality remains highly dependent upon the size of its crop harvest. The gross domestic product, which measures the value of goods and service produced, was $2.6 billion in 2004. With assistance from the International Monetary Fund and other international organizations, Moldova initiated widespread privatization and strict monetary controls soon after independence. The policies contained inflation—which had resulted in prices increasing by as much as 20 times annually in the early 1990s—to one of the lowest rates in the former Soviet republics. To privatize housing and industry, the government issued vouchers to residents based on the number of years they had worked for state enterprises. Residents exchanged the vouchers for ownership shares in enterprises or for housing. By 1997 the majority of former state enterprises were in private hands. Moldova was among the first of the former Soviet republics to allow private ownership of farmland. Moldova’s economy is built upon agriculture, which contributed 21 percent of GDP in 2004. The country’s extremely fertile land and temperate climate allow for the cultivation of a variety of crops. Moldova is a leading producer of grapes, tobacco, and rose oil. Other crops include wheat; maize; vegetables, such as tomatoes and potatoes; sugar beets; and fruit. Livestock raising, particularly pigs, and milk production are also important. Industry, which accounted for 24 percent of GDP in 2004, is dominated by food processing. The country has traditionally specialized in frozen and canned vegetables. It is also well known for sparkling wines and brandy produced from its grape harvest. Other industries use locally grown sunflowers and soybeans to make vegetable oil, and beets to process raw sugar. During the Soviet era, manufacturing plants were developed to produce military equipment and consumer goods, and Moldova remains a significant producer of carpets, refrigerators and freezers, washing machines, and televisions. Moldova also has a metal-refining industry, almost entirely dependent upon imported raw materials and fuels. More than one-quarter of Moldova’s industrial plants are in the disputed Trans-Dniester region. While Moldova has small oil and natural gas reserves, it must import most of its fuels from Russia. Fuel payments are a constant drain on the country’s economy. In 2003, 88 percent of its electricity was produced in thermal plants burning fossil fuels; the remainder was produced in a single hydroelectric facility on the Dniester River. Moldova’s principal trading relationships are with other former Soviet republics, chiefly Russia and Ukraine. Trade with countries to the west is increasing, led by exchanges with Romania and Germany. Food and agricultural products account for about one-half of exports, while the leading imports are fuel, electricity, and mineral products. Moldova used the Russian ruble as its legal tender until November 1993, when it introduced its own currency, the leu.