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Moldova: How the diaspora of Europe's poorest nation keeps its economy afloat

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Moldova: How the diaspora of Europe's poorest nation keeps its economy afloat
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Back in 1998, Russia was Moldova's biggest trading partner, accounting for 60% of exports from the country that borders Romania in the west and Ukraine in the east.

Two decades on and that ratio has been reversed, with two-thirds of exports from Moldova heading instead to the European Union, with which the country signed an association agreement in 2014. Just 10% of total exports now go to Russia.

Moldova remains Europe's poorest nation in economic terms, with between 1.2 million and two million - one-third of the population - currently living and working abroad. The money they send back props up the nation's economy and supports families with little prospects at home.

“Our people, our immigrants, most of them are now in the European Union western countries," said Veaceslav Ionita, an economics expert at IDIS Viitorul Insitute.

"We have immigrants in Russia but it's more poor people, from rural areas, because it is easier to go to Russia, and usually for a short term. They go to Europe for the long term."

Remittances, Ionita explained, are worth more to Moldova than exports.

Little surprise, then, that when you ask people in Moldova where the future of their children lie it is outside the country, where they can make money and have opportunities they lack at home.

The economy is one of the major issues in Sunday's presidential election, which pits Maia Sandu, a pro-European former prime minister, against Igor Dodon, the incumbent president. Since taking power in 2016, Dodon has taken Moldova closer to Russia at the expense of its relationship with the EU.

Sandu was beaten by Dodon in 2016 but on November 1 won the first round of the election due, in part, to a huge turnout by the Moldovan diaspora. The election on Sunday will undoubtedly be close, but should the diaspora turn out in big numbers again, Sandu stands a very real chance of victory.

As well as strengthening links with the EU Sandu has pledged to fight corruption, a particularly hot topic in Moldova since as much as $1 billion was stolen from Moldovan banks in 2014 and 2015 and high-profile political figures implicated in the fraud.

No one has been convicted over the theft and as of 2020 none of the money has ever been recovered.

The EU, meanwhile, is doing some public relations of its own. It recently opened a new information centre in Chisinau, the capital, which outlines how the EU invests in agriculture, cultural heritage, civil society, and in important reforms such as fighting corruption and ensuring the rule of law.

“Democratic standards, including standards for the democratic process, are an important part of the values on which we agreed in our Association Agreement,” said Peter Michalko, EU Ambassador to Moldova.