The economy of the Republic of Moldova from the perspective of sustainable development

Journal of Social Sciences Vol. VIII, no. 3 (2025), pp. 49 - 59 Fascicle Social Science ISSN 2587-3490 Topic Economics and Management eISSN 2587-3504 Journal of Social Sciences September 2025, Vol. 8 https://doi.org/10.52326/jss.utm.2025.8(3).04 CZU 330.34:005.936.5:504.6(478) THE ECONOMY OF THE REPUBLIC OF MOLDOVA FROM THE PERSPECTIVE OF SUSTAINABLE DEVELOPMENT Rafael Ciloci*, ORCID 0000-0003-1690-6897, Iuliu Turcan, ORCID 0000-0002-2930-6682 Technical University of Moldova, 168 Ștefan cel Mare Blvd., Chisinau, Republic of Moldova * Corresponding author: Rafael Ciloci, [email protected] Received: 08. 24. 2025 Accepted: 09. 26. 2025 Abstract. The development of the national economy from the perspective of sustainable development is determined by complex relationships between economic, social and environmental factors in the context of global transformations determined by the challenges of climate change. In the case of the Republic of Moldova, this process is determined by many challenges, by a multitude of impediments, but also by opportunities such as, for example, integration into the European Union. Examining the sustainable development of a nation requires an integrated and interdisciplinary approach, combining statistical analysis, the evaluation of economic performance indicators to characterize how public policies influence long-term economic development. In this publication, the research methodology is based on data collection and analysis, quantitative and qualitative analysis, deduction and induction, complemented by a rigorous synthesis of the specialized literature. The results obtained support the hypothesis that the adoption of sustainable, complex strategies with clearly defined objectives, the formation of an institution responsible for the transition to a circular economy can lead to increased national economic competitiveness and improved quality of life of citizens. The study highlights the key elements necessary for the implementation of the transition to a sustainable economy such as regulatory framework, financial resources, new technologies and cultural aspects. These findings provide a reference framework for decision-makers and the academic community, facilitating the development of coherent policies that maximize the potential for sustainable economic growth of the Republic of Moldova and for the development of medium and long-term development strategies. Keywords: waste generation, environmental protection, sustainable development, circular economy, regulatory framework, EU integration Rezumat. Dezvoltarea economiei naționale din perspectiva dezvoltării durabile este determinată de relații complexe dintre factorii economici, sociali și de mediu, într-un context al transformărilor globale determinate de provocările schimbărilor climatice. În cazul Republicii Moldova, acest proces este plin de numeroase provocări, determinate de o multitudine de impedimente, dar și de oportunități precum, de exemplu, integrarea în Uniunea Europeană. Examinarea dezvoltării durabile a unei națiuni necesită o abordare 50 R. Ciloci, Iu. Turcan Journal of Social Sciences September, 2025, Vol. 8 integrată și interdisciplinară, care să combine analiza statistică, evaluarea indicatorilor de performanță economică pentru a caracteriza modul în care politicile publice influențează dezvoltarea economică pe termen lung. În acest articol, metodologia de cercetare se bazează pe colectarea și analiza datelor, analiza cantitativă și calitativă, deducție și inducție, completată de o sinteză riguroasă a literaturii de specialitate. Rezultatele obținute susțin ipoteza că adoptarea unor strategii durabile, complexe, cu obiective clar definite, formarea unei instituții responsabile de tranziția către o economie circulară pot duce la creșterea competitivității economice naționale și la îmbunătățirea calității vieții cetățenilor. Studiul evidențiază elementele cheie necesare pentru implementarea tranziției către o economie durabilă, cum ar fi: cadrul de reglementare, resursele financiare, noile tehnologii și aspectele culturale. Aceste constatări oferă un cadru de referință pentru factorii de decizie și comunitatea academică, facilitând elaborarea unor politici coerente care să maximizeze potențialul de creștere economică durabilă a Republicii Moldova și pentru elaborarea unor strategii de dezvoltare pe termen mediu și lung. Cuvinte-cheie: generarea de deșeuri, protecția mediului, dezvoltare durabilă, economie circulară, cadru de reglementare, integrare în UE. 1. Introduction Circular economy is a development model for the future both for post-industrial, economically developed countries, but also for such states that are in a continuous process of transition as the Republic of Moldova. The development of a sustainable economy in the Republic of Moldova is determined both by internal factors - ecological problems that are becoming increasingly prominent, especially in the context of global warming and increasingly frequent droughts, but also due to external factors such as EU integration and, thus, adjustment to its legal framework [1]. Recently, the Republic of Moldova has taken some measures to integrate the principles of the circular economy into its economic policies, environmental strategies and social development objectives. This transformation is necessary due to the double impact, namely: to reduce the negative impact on the environment and to develop economic resilience. The current situation is a very dynamic one, with many challenges but also opportunities, characterized by evolving institutions and legal frameworks, the gradual adoption of policies that emphasize resource efficiency, and incipient innovative practices. The transition to a circular economy in the Republic of Moldova faces a set of impediments that must be taken into account. The legal framework, although adopted, still does not have a well-developed action plan with the allocation of the necessary resources for their implementation, a set of indicators for measuring circularity are not identified that could effectively evaluate policies, but also the performance of enterprises. This would allow determining progress towards sustainability objectives and establishing clear rules and requirements for all actors [2]. The institutional framework of the Republic of Moldova still has modest coordination capacities between various government agencies, private stakeholders and civil society regarding the adaptation to the sustainability paradigm, and bureaucratic inefficiencies and ineffective institutional dialogues may hinder the execution of integrated circular economy policies. We have to underline that the Government of the Republic of Moldova has made preliminary efforts to align national policies with European Union standards, in particular The economy of the Republic of Moldova from the perspective of sustainable development 51 Journal of Social Sciences September, 2025, Vol. 8 those related to environmental protection and waste management. As result some pilot projects have been initiated to promote recycling, reuse and more efficient use of resources in different sectors of the economy. However, the implementation of these policies often faces obstacles due to limited financial resources, lack of technical expertise and the need for better coordination of stakeholders. Therefore, while the policy framework is evolving, significant challenges remain in creating the infrastructure for the circular economy, scaling up circular economy projects and forming sustainable ecosystems. Consumer awareness of environmental issues is another key element in the transition to a circular economy, and educational programs and media campaigns are needed to identify existing problems and determine solutions such as waste reduction, waste collection and sorting, and energy efficiency. Community projects are of major importance for implementing the principles of the circular economy, but continuous efforts are needed to change consumption habits, a process that can be long-term and requires adjustment to the local cultural context. In the reviewed literature, great attention is paid to the need for the transition to a circular economy, the advantages but also the challenges specific to this process. In this research, we aim to examine the ecological situation of the Republic of Moldova from the perspective of waste emissions and the extent to which measures are taken to remediate it. Examining this data will allow us to identify reasoned proposals for the development of a sustainable economy for the Republic of Moldova. 2. Materials and Methods The research examines in detail data on waste generation in the Republic of Moldova according to structure and dynamics, as well as expenditures by types of environmental protection activities in the Republic of Moldova with the aim of identifying the impact of the waste on the environment on the one hand, and on the other hand to what extent financial resources are allocated to protect the external environment. It collects data from official sources such as the National Bureau of Statistics of Moldova [3], which allows us to consider that they are relevant, correct and can constitute a basis for certain conclusions, with the admission that not all data were recorded, but this would not constitute an impediment to that research, especially in consideration of the examination of economic trends and the comparative analysis of different sectors. The research of the study is based on data collection and quantitative and qualitative analysis, deduction and induction, complemented by a rigorous synthesis of specialized literature. 3. Results and Discussions Sustainable development and the formation of a green economy are becoming one of the main priorities for the Republic of Moldova, especially in the context of the Republic of Moldova's integration into the EU and the need to adjust the legal framework, as well as implement best practices. These are reflected in the main policy documents of the governmental institutions, in particular in the National Development Strategy Moldova 2030, the Energy Strategy 2030, the SME Sector Development Strategy for 2012-2020, the Roadmap for Improving Competitiveness, the Agriculture Development Strategy 2013-2020, the Environment Strategy 2014-2023, the Programme for Promoting the Green Economy in the Republic of Moldova for 2018-2020 [4]. Having reviewed several sources in this field, we will seek to highlight the key opportunities of sustainable development and its impact on the country’s economy. 52 R. Ciloci, Iu. Turcan Journal of Social Sciences September, 2025, Vol. 8 - The Republic of Moldova’s shift toward a circular economy offers a real chance to boost both resilience and competitiveness. Making this a reality will take political commitment, significant investment and a strong legal framework. While progress in renewable energy and emission reductions is encouraging, it must go hand in hand with better resource management and support for eco-innovation. Linking efficiency measures with socio-economic factors can help ensure that public policies are both coherent and truly sustainable [5]. - Over the past thirty years, the Republic of Moldova has gone through significant economic and social changes. The country has managed to diversify its economy and reduce its dependence on agriculture alone. Still, ongoing challenges like trade imbalances, the quality of water resources, and limits in domestic production, require clear and strategic action. By promoting innovation, expanding productive sectors and strengthening economic ties abroad, Republic of Moldova can secure sustainable development and build a brighter economic future [6]. - Republic of Moldova stands at a turning point. By embracing the circular economy and fostering innovative business models, the country can tackle resource shortages and ease the strain on its environment. Updating laws and creating a business-friendly climate, together with a genuine shift in how companies operate are crucial steps toward sustainable growth. The circular economy is more than just a choice, it is a strategic necessity for building a resilient and prosperous future for Moldova [7]. - Sustainable development, guided by the principles of a circular economy, is no longer just a global trend, it is a necessity for Republic of Moldova. By aligning economic policies with the protection of natural and socio-cultural ecosystems, and by actively involving all members of society, the country can build a truly sustainable circular system. Today’s crises can become a catalyst, prompting a rethinking of values and guiding Republic of Moldova toward a future of lasting, responsible growth [2]. - For Republic of Moldova, sustainable economic development means more than just growth, it also requires improving people’s quality of life, strengthening education, and protecting the environment, even in the face of economic and social challenges. Stronger export competitiveness and attracting foreign investment are key to moving forward. At the same time, making the most of the opportunities that come with European integration can give the country a solid path toward long-term, sustainable progress [1]. - The circular economy offers a practical way to reduce pollution and preserve natural resources, while also creating new opportunities for Republic of Moldova’s development. Replacing the linear model with a circular one can support sustainable economic growth by making smarter and more responsible use of existing resources. Embracing this concept is essential not only to keep pace with global trends but also to secure a sustainable future [8]. - The introduction of an Integrated Management System in Moldova’s light industry has strengthened companies’ commitment to both social and environmental responsibility. This approach has not only improved the sustainability of businesses but also encouraged the adoption of circular economy principles. Putting people and society first is becoming a key driver of sustainable development [9]. - Sustainable development has become a key reference point in addressing economic growth and environmental protection, especially in the context of limited resources. First promoted internationally in the 1970s and firmly established at the 1992 UN Conference in The economy of the Republic of Moldova from the perspective of sustainable development 53 Journal of Social Sciences September, 2025, Vol. 8 Rio, this approach seeks to balance natural capital with socio-economic systems. It now stands as the foundation for an integrated vision of long-term human progress [10]. - The application of sustainable development principles in Moldova, within the broader context of European integration, is aimed at boosting the competitiveness of industry while promoting economic, social, and environmental sustainability. Aligning with European strategies for long-term planning provides valuable guidance for the sustainable growth of the national industrial sector. A sustainable industrial policy is becoming a vital tool for driving both economic and social progress in the country [11]. In the next section, we take a closer look at the data on waste generation in the Republic of Moldova over recent years, highlighting key trends and developments. The development of the circular economy is a very complex, specific process and depends, to a large extent, on the structure of national economies and, respectively, on the type of waste emitted. Thus, in order to examine the method, prospects, but also the challenges of the transition to the circular economy for the Republic of Moldova, it is necessary to carry out a quantitative and qualitative analysis of waste, which would allow identifying solutions for the national economy. From the presented data in Table 1, we observe that in the Republic of Moldova waste generation is unstable, without a well-marked trend. Thus, we can observe that the largest share of waste is determined by agriculture, horticulture, aquaculture, forestry, hunting and fishing, food preparation and processing reaching a level of 51.11 - 78.49% at total during the examined period. A special situation is attested in 2022 when Moldova was affected by a severe drought, which determined a decrease in cereals and leguminous crops from 4690.0 thousand tons in 2021 to 1784.4 thousand tons in 2022. Therefore, a direct correlation is highlighted between the volume of production in agriculture and the waste created, so if the volume of production of cereals and leguminous crops decreased for 2021-2022 by 2.63 times, then the amount of waste created decreased by 2.22 times. Table 1 Waste generation in the Republic of Moldova for 2020-2023, tons Types of wastes 2020 2021 2022 2023 From agriculture, horticulture, aquaculture, forestry, hunting and fishing, food preparation and processing 325766.5 300368.1 135391.1 275503.4 Municipal (household and similar trade, industry and institutions), including separately collected fractions 49898.1 68324.6 53906.3 58910.5 From construction and demolition (including soil excavated from contaminated sites) 6208.4 13185.8 20937.6 5358.0 From the leather, fur and textile industries 652.1 1562.1 1298.1 1378.6 Others 32519.9 32328.3 53250.8 31231.6 Total 415045.0 415768.9 264783.9 372382.1 Source: Systematized by the authors based on data [3]. At the same time, we can observe that the generation of municipal waste (household and similar trade, industry and institutions), including separately collected fractions, is comparatively stable with an increasing trend, while the generation of waste in construction 54 R. Ciloci, Iu. Turcan Journal of Social Sciences September, 2025, Vol. 8 and demolition (including soil excavated from contaminated sites) and the leather, fur and textile industries has an unstable character, being determined by the specific economic situation of each branch, with very large differences being attested from one year to another. In conclusion, although apparently the amount of waste is decreasing, we must note that this fact is determined by climatic conditions and the high share of waste from agriculture, thus, in the case of a good agricultural year, the amount of waste can reach high values again. From the data in Table 2, we observe, first of all, a very large discrepancy between current expenditures and expenditures for the capital repair of fixed assets, thus this ratio in 2020 amounted to 17.59 times, and in 2023 the value is 14.3 times, the maximum being reached in 2022 with a value of 22 times. Even if a relative improvement of this indicator is attested for 2023, the result cannot be considered favorable. Regarding current expenditures for environmental protection, we attest a constant increase, thus for the period 2020-2020 they increased by 55.3%, which can be considered positive result. However, unacceptably low expenditures are attested for conservation of biodiversity and natural areas, which constitute 173.5-404.9 thousand lei for the examined period. A substantial increase, although in absolute values the expenditures are still modest, is attested for atmospheric air protection and prevention of climate change by 9.32 times for the examined period, for waste management by 1.84 times, for protection and rehabilitation of groundwater and surface water by 1.76 times, and, unfortunately, for soil protection and rehabilitation a decrease of 31.1% is attested. Regarding expenditures for the capital repair of fixed assets, although we note an increase of 1.91 times in 2023 compared to 2020, the situation is still quite precarious. Unfortunately, investments in environmental protection are at a fairly modest level, below the needs of an economy in transition to a green economy. If in the previous table we noted that the largest share of waste is determined by the agricultural sector, then we can conclude that both current expenditures and investments are well below the needs of this sector. Thus, we have to underline that, although the Republic of Moldova has approved a certain regulatory framework for the transition to a circular economy, there are still no sufficient incentives or financial instruments to create an infrastructure related to the green economy. Therefore, it is necessary to create mechanisms that would stimulate investments in technologies that would reduce waste creation, waste processing or the design of products with minimal waste, which can be easily reused. Table 2 Expenditures by types of environmental protection activities in the Republic of Moldova for 2020-2023, thousand lei Protection activities 2020 2021 2022 2023 Current expenditures Expenditures for the capital repair of fixed assets Current expenditures Expenditures for the capital repair of fixed assets Current expenditures Expenditures for the capital repair of fixed assets Current expenditures Expenditures for the capital repair of fixed assets For atmospheric air protection and prevention of climate change 5553.0 5284.0 8753.2 2303.0 13844.4 1837.2 51741.3 13341.9 The economy of the Republic of Moldova from the perspective of sustainable development 55 Journal of Social Sciences September, 2025, Vol. 8 Continuation Table 2 For collecting and treating wastewater 182530.3 8121.4 189528.0 5920.9 204167.6 3597.6 218930.5 5383.3 For waste management 66258.6 1098.3 124585.9 2407.4 117284.6 5877.0 121786.5 6274.2 For soil protection and rehabilitation 3553.8 0.0 3205.8 0.0 1686.0 0.0 2448.3 0.0 For protection and rehabilitation of groundwater and surface water 3284.1 508.1 3119.3 8370.1 3092.0 266.7 5775.9 2439.2 For conservation of biodiversity and natural areas 173.5 0.0 125.0 0.0 89.8 0.0 404.9 0.0 For other areas 3629.2 53.6 4797.7 434.9 30465.0 5264.7 10437.1 1340.8 TOTAL 264982.5 15065.4 334114.9 19436.3 370629.4 16843.2 411524.5 28779.4 Source: Systematized by the authors based on data [3]. In particular, the textile, food and construction industries - traditional areas for the Republic of Moldova - have started to implement innovative practices, such as waste recovery, end-of-life reuse and the adoption of eco-design principles [12-14]. However, the scale of these initiatives remains limited at the local community or enterprise level and there is a substantial gap between pilot projects and large-scale industrial implementation. Thus, the systemic integration of circular economy principles requires not only technological innovation, but also investments in human capital and infrastructure. The waste management system in Moldova is undergoing transformation, with gradual improvements in municipal waste collection and sorting, and interest in developing infrastructure for recycling and composting. Public institutions have also initiated awareness campaigns aimed at changing consumer behavior towards sustainable practices. However, Moldova faces challenges such as inefficient collection systems, insufficient investment in waste processing technologies [15]. The transition to a circular economy can be significantly facilitated by the incorporation of digital technologies, which would allow for the optimization of resource management. Digital platforms can be developed to facilitate the control and traceability of materials in the supply, production and consumption chains, ensure the implementation of extended producer responsibility, contribute to the dissemination of information on sustainability for consumers. The synergy between digital innovation and circular economy practices has the potential to increase economic efficiency in tandem with ensuring the principles of the 56 R. Ciloci, Iu. Turcan Journal of Social Sciences September, 2025, Vol. 8 circular economy. However, we must note that the integration of advanced digital tools is still at an early stage and considerable investments are needed to create big data infrastructure and ensure appropriate education [16]. In the above, we have identified a set of complex and interconnected the main directions for the development of the circular economy in the Republic of Moldova: 3.1 Policies and Regulatory Framework The regulatory framework of the Republic of Moldova has evolved to align with European Union standards; however, there are still some shortcomings in terms of established indicators and quantified objectives. Regulations have been developed that provide for recycling, resource recovery and waste reduction, but there are no clear requirements for the implementation of these goals. However, as the Republic of Moldova joins the EU, there is an opportunity to develop its policy framework and instruments by adopting a comprehensive national circular economy strategy, which establishes clear performance indicators, tax incentives for businesses and sanctions for non-compliance. EU integration and the post-accession stage include technical assistance instruments, capacity building and financial support, which would facilitate transparent monitoring of progress and help attract foreign investment in green technologies. It should also be highlighted that regulatory disparities, including those regarding practices with major trading partners (primarily the EU), can create impediments to trade and restrict market access. At the same time, by adopting best practices and obtaining certifications for circular economy performance, domestic products can become more competitive in new market segments characteristic of the green economy. European integration can encourage the development of regional economic infrastructure, such as waste management facilities or the creation of recycling partnerships, which would ensure economies of scale and reduce operational costs. Therefore, we propose the creation of a central institution to coordinate the implementation of circular economy projects, which would constitute a robust platform for sustainable development and would allow for efficient monitoring of progress, stimulate innovation, make it possible to capitalize on the expertise of both domestic and international partners, and ensure institutional accountability. 3.2 Investments As previously discussed, one of the significant challenges facing the Republic of Moldova in the transition to a circular economy is the lack of specific financial instruments that would allow pilot projects to be scaled up. Also, limited domestic financial resources and reduced access to international financing constitute an impediment to research and development in the field of circular technologies and waste management systems, as well as the takeover of new green business models. At the same time, the Government of the Republic of Moldova can access international financing through green bonds, EU funds, EBRD, etc. There is a trend, at least regionally, for investors interested in sustainable projects, and the Republic of Moldova could benefit from attracting investments for the development of the circular economy. Moreover, public-private partnerships (PPPs) can mobilize resources for the modernization of waste collection systems and recycling facilities. By establishing funds dedicated to the circular economy, the government can subsidize and provide favorable financing conditions to support enterprises in the transition to sustainable production processes. The economy of the Republic of Moldova from the perspective of sustainable development 57 Journal of Social Sciences September, 2025, Vol. 8 3.3 Technological Development Technological progress is another challenge but also an opportunity to move towards a sustainable development trajectory. Current waste management, energy recovery and material processing systems lack the modern infrastructure needed to fully exploit the benefits of the circular economy. At the same time, digitalization is a necessary ingredient to facilitate the restructuring of business processes due to the ability to monitor and optimize the flows of resources used, and the use of sensors and digital tools for production systems, modern recycling facilities, waste collection are essential to increase operational efficiency and traceability [17]. The use of digital technology within the circular economy offers excellent opportunities, as the Internet of Things (IoT), big data analysis and blockchain can revolutionize traditional industries in the Republic of Moldova. By digitizing the value chain, enterprises can optimize resource use and reduce waste generation at each stage, thus ensuring Extended Producer Responsibility. At the same time, government support can be achieved by supporting innovation centers and through tax incentives for the adoption of new technologies, manufacturing new products in accordance with the principles of the circular economy. 3.4 Industrial Transformation From the data examined, we note that traditional sectors of the economy of the Republic of Moldova such as: agriculture, food industry, textile and construction are characterized by a production with a relatively high level of waste and current expenses, investments for environmental protection at a relatively modest level to ensure sustainable production. The transformation of these sectors by including circular production models requires not only the re-equipment of production facilities, but also a cultural change of managers. It is also necessary to train the workforce according new technologies, ecoefficient processes and sustainable product design. Adopting eco-design principles and integrating waste minimization processes can lead to new business models that value industrial by-products. In agriculture, circular practices, such as the use of organic waste to generate bioenergy or compost, can improve soil fertility and reduce chemical fertilizer inputs. Food processing companies can innovate by transforming food waste into value-added ingredients [18]. Cross-sector collaborations, incubated through industrial clusters, could stimulate innovation in closed-loop supply chains. This reorientation not only minimizes environmental impact but also drives economic resilience. 3.5 Cultural Transformation The transition from linear models to a circular economy requires a multidimensional change in consumer behavior, corporate strategies and societal norms. The awareness of the general public about the benefits of circularity and its long-term socio-economic advantages is still at an early stage. Cultural inertia and relatively modest knowledge about the environmental impact constitute an impediment to the adoption of new circular models. Therefore, it is necessary to strengthen environmental education and the principles of the circular economy, at all levels - from schools and universities to vocational training programs. Educational programs and media campaigns focused on waste reduction, waste collection and sorting, energy efficiency are still needed.