Former Prime Minister and businessman Ion Sturza admitted that he had been too optimistic when previously expressing his views on Moldova’s economy. He said the figures emerging from the budget revision, the weak fiscal and budgetary reform, and the lack of consistency in administrative-territorial reform have led him to believe that the situation is far more complex, if not downright complicated, reports TRIBUNA.

According to Sturza, the current economic model does not generate anywhere near enough revenue to cover the state’s minimum operating expenses. The country is borrowing more and more, the deficit has reached 6% of GDP, and debt servicing has become one of the largest items of budget expenditure, at 6.5 billion lei.

“We no longer have much fiscal space. We are already collecting more than 35% of GDP. Raising taxes is not only unpopular; it directly hits consumption and economic growth.

The hope of achieving major economic growth based solely on good intentions is an illusion. The same applies to hopes of rapid EU integration and the automatic arrival of funds and grants. Europe has already shown us its ‘teeth.’ Something is not to their liking, and they are finding more and more reasons not to give us money for free.

Foreign investment? Certainly! But what is our offer?

A large market with wealthy consumers? A large pool of cheap labor that can be put to work on assembly lines? Cheap energy and mineral resources? A developed banking and capital market? Road infrastructure? Consolidated agricultural land? Substantial government grants and subsidies? A functioning judicial system? A political system with a competent government and an educated opposition?

As an investor, I don’t get out of bed unless I have convincing answers to ALL these questions and the prospect of an annual return of 20–30%. That’s an axiom,” the former prime minister said.

Ion Sturza said that something radical is needed. Otherwise, the country risks collapsing.

“I think Vasile Tofan was too polite when he told us how things stand, and then became ‘politically correct’ too quickly: outrageous salaries, absorption… He ended up taking the same approach as everyone before him: We don’t have money? Let’s borrow!

We need to encourage him to return to the ‘chainsaw.’ Not necessarily as a method of amputation — that sounds populist — but as a metaphor for radical change. We need to bring expectations into line with reality.

Inflation at 10%, astronomical energy tariffs, salary expectations, and the external environment make this mission extremely difficult.

How should we proceed? It is good that we have at least partially identified the diagnosis. It is good that we have competent economists in the Government and in the public sphere. It is bad that politicians, both those in government and those in opposition, have no idea how to solve the problems. We have to try. Without fantasies and fanaticism. Without personal PR and soap-opera stories. Something simply has to be done. Otherwise, everything — government, country, investment, this and that — no longer makes any sense,” he added.