Moldova Between Giants: A Small Economy in the EU–US–Russia Triangle

Moldova: a small landlocked state of less of 3 million people, squeezed between Romania and Ukraine, described as Europe’s poorest country. Despite its modest size, Moldova sits at the crossroads of some of the world’s most consequential power struggles. The country’s economy remains heavily burdened by debt, much of it linked to the import of Russian natural gas, while over half of its population experiences energy poverty. According to UNDP data, more than 60% of Moldovans spend over 10% of their household budgets on energy, and the war in near Ukraine has deepened this fragility. In 2022 alone, the conflict was projected to shave between 2% and 10% off Moldova’s GDP, depending on the war’s duration and scope. Considering that three years have already passed, this proportion is likely to have increased. Poverty reduction has stalled and rural areas remain disproportionately affected, suffering from low productivity, weak governance, and limited access to services. Climate change adds another layer of vulnerability, threatening Moldova’s agriculture-based economy. Against this socio-economic backdrop, the debate over Moldova’s elections - greeted as “a new victory for Brussels” - reveals a deeper question: what is truly at stake in this small but strategic corner of Europe?

One State for several communities: the Complexity of the Moldovan Territory

To understand Moldova’s geopolitical position, it is of fundamental importance to stress the complexity of its territory and internal divisions. Moldova is, in many ways, one state for several communities, each representing a different identity and orientation, both culturally and politically.

Transnistria, a state within a state, a narrow strip of land between the Dniester River and Ukraine, has been under the control of a Moscow-backed separatist regime since the early 1990s. It is effectively a frozen conflict zone where Russian troops and intelligence still exert strong influence. When at the very starting of 2025 Russia turned off the gas taps, the region plunged into both an energy and humanitarian crisis. Factories closed, heating systems failed, and power cuts lasting up to eight hours became common. Letting this region freeze was a way to exert pressure on both Chisinau and Kyiv.  For Russia, which continues to maintain a troop presence in the territory, Transnistria represents a bridgehead beyond Ukraine and deeper into central Europe.

Even though Transnistria is often cited as Moldova’s main issue, it is not the only area where pro-Russian sentiments are strong. Further south lies Gagauzia, an autonomous region of around 130,000 people belonging to a Turkic-speaking, Christian Orthodox ethnic group. Despite their historic repression under the Soviet Union, most Gagauz people are now Russian-speaking and markedly pro-Russian. Granted autonomy in 1994, Gagauzia manages most of its internal affairs but remains subordinate to the Moldovan central government in foreign, defence, and monetary policy. The region’s identity embodies a cultural symbiosis, influenced by Balkan, Slavic, and Moldovan traditions. Moscow continues to cultivate ties through economic aid and political patronage, viewing Gagauzia as a strategic foothold for maintaining influence in Southeastern Europe.

The coexistence of these regions reveals Moldova’s deepest internal challenge: the struggle to reconcile its pro-European majority with the strong Russophile sentiments embedded in parts of its territory. This tension continues to shape Moldova’s foreign policy and its uncertain path toward the European Union.

Between Brussels and Moscow: Moldova’s European Aspiration

Moldova applied for EU membership in March 2022, just weeks after Russia’s invasion of Ukraine. For many Moldovans, European integration represents not only a geopolitical choice but also a civilizational one: a path toward rule of law, economic modernization, and energy independence. Yet the road to Brussels remains steep.

The country still relies heavily on infrastructure located in the Transnistrian region, including key energy routes. Russia’s manipulation of gas supplies in early 2025 triggered a severe energy crisis, highlighting Moldova’s dependence on external actors. Moreover, Moscow’s hybrid warfare - disinformation campaigns, cyberattacks, and support for destabilizing protests - aims to erode public confidence in democratic institutions.

Nevertheless, Moldova’s leadership has pushed forward. In October 2024, Moldovans narrowly approved (50.39% in favor), with a constitutional referendum, the request for EU membership. The margin of just 0.7 percentage points, but the result was perceived as an EU victory, achieved despite a large-scale Russian interference campaign, signaled both the fragility and the persistence of Moldova’s European orientation.

Brussels has responded decisively. In March 2025, the European Parliament approved a €1.9 billion Reform and Growth Facility for Moldova: the largest EU financial support package since the country’s independence. This includes grants and low-interest loans to strengthen governance, infrastructure, and energy resilience. A separate €250 million package is dedicated to decoupling Moldova from Russian gas and integrating it into the EU energy market. Additionally, Moldova has become the second-largest beneficiary of the European Peace Facility, receiving up to €197 million between 2021 and 2025 to bolster its security and defence capabilities.

European diplomacy, too, has been visibly engaged. Recent visits to Chișinău by leaders such as Emmanuel Macron, Friedrich Merz, and Donald Tusk underscore the growing recognition of Moldova’s strategic role as a frontline state between the EU and Russia.

Washington’s Cautious Ally 

Across the Atlantic, Moldova’s relationship with the United States has oscillated between cautious engagement and strategic neglect. The Trump administration’s revisionist stance toward Europe and its ambiguous approach to Russia complicated U.S. – Moldova relations. Yet these very circumstances underscored the urgency of building a more resilient partnership.

Moldova’s position, at the intersection of the EU, Ukraine, and the Black Sea region, gives it outsized geopolitical importance relative to its size. Moldova serves as a microcosm of the political and security challenges facing Europe more broadly. In just a few short years, Moldova has become one of the largest recipients of U.S. foreign assistance in Europe. Ambassador Logsdon’s Speech at the 10th Moldovan-American Conference made it clear: in 2024, the United States has provided over $45 million worth of Foreign Military Financing. To make a comparison, between FY2010 and FY2021 just $10 million short of the cumulative amount of FMF provided to Chișinău. At the same time, the approach is cautious. Although the United States is interested in enhancing Moldova’s defense capacities, it remains prudent about transferring its more sophisticated defense technologies to partners considered vulnerable to security risks.

Conclusion

Recent events illustrate how Moldova’s vulnerabilities are inseparable from its geography. In 2024, fragments of Russian drones were found in the southern region of Ceadîr-Lunga, near the Ukrainian border. A stark reminder of how close the war has come. At the same time, Moldova continues to host thousands of Ukrainian refugees, trying to integrate them into its labour market and social systems with UN support. The massive influx of Ukrainian refugees, the trajectory of the conflict and its eventual outcomes are likely to be defining features of Moldova’s security environment. The consolidation of Russian influence in Transnistria represents a potentially enduring challenge to regional security over the medium and long term. Despite Russia’s territorial presence being limited to the Kherson Oblast in the south, the conflict’s resolution will be decisive in determining the final configuration of control and the long-term stability of the region.

In the meanwhile, the newly elected president Maia Sandu, chairing the National Commission for European Integration, emphasized that joining the EU “requires continuous effort, responsibility, and institutional coordination.” European Commissioner for Enlargement Marta Kos confirmed in the 2025 Enlargement Report that Moldova has made the most progress among all candidate countries. Yet the path ahead remains uncertain. 

Moldova’s future, whether as a bridge or a battleground between East and West, will depend on its ability to maintain unity among its fragmented regions and resilience amid external pressures.

For now, this small, fragile state remains both a test and a symbol: a test of Europe’s capacity to protect its democratic periphery, and a symbol of how even the poorest nation in Europe can stand at the very heart of the continent’s geopolitical game.