Location: Moldova

Strengthening Human Capital: How Ukraine and Moldova Can Retain and Reconnect Their Students

Posted on December 22, 2025 | Policy Brief

As more young people from Ukraine and Moldova choose to study abroad, the question of whether internationally educated youth return home has significant implications for demographic sustainability and economic growth. This policy brief presents findings from a survey of young people from Ukraine and Moldova. It outlines their motivations and considerations when deciding whether to study in their home countries or abroad, as well as what it would take for states to transform potential “brain drain” into “brain gain”. The survey data reveal a generation of young people facing constraints and uncertainty, yet still willing to invest in their societies. The analysis highlights a dual task facing both states: They need to offer high-quality education for students who choose to study domestically, while also maintaining meaningful ties with students and graduates educated abroad. Meeting these challenges means contributing to national resilience and human capital development.

Introduction

Across Ukraine and Moldova, an increasing number of young people are choosing to pursue their studies abroad in search of high-quality education, international experiences, and stronger career prospects. The challenge for the two states is to encourage the return of the internationally educated youth to halt the loss of much-needed human capital. Two countries already face labour shortages and ageing populations. One-way student emigration risks weakening their innovation potential and slowing economic development, just as EU integration efforts intensify. Yet, with the right policies, this mobility can be turned from a “brain drain” into a “brain gain”.

This policy brief addresses two questions. First, how do individual, structural, political, and security-related factors shape the decisions of young people from Ukraine and Moldova to study at home or abroad? And second, under what conditions are students studying abroad willing to return, and what would it take for states to transform potential “brain drain” into “brain gain”?

To answer these questions, the analysis draws on a survey of young people from Ukraine and Moldova who studied domestically and/or abroad. The survey, which included multiple-choice and open-ended questions, collected responses from 118 individuals originally from either country (N = 236). These findings, complemented by several in-depth interviews with students and academics (conducted separately from the survey), provide insight into how young people from Ukraine and Moldova chose their study destination countries and how their states can better support and engage them at home and abroad.

Ukraine: Educational Choices and Emigration Under Wartime Conditions

Background: By October 2025, Russian attacks had damaged or destroyed 38% of Ukraine’s university facilities (Mykhailova, 2025). Despite the war, universities continue to expand student opportunities, strengthen institutions, and align with EU standards. To mitigate brain drain and performance risks, they draw on government, private-sector, and international support. Participation in Erasmus+, European Universities Alliances, and Horizon Europe helps build institutional capacity and sustain research funding (ERUA, 2025; European Commission, 2024).

In almost four years of full-scale war, the young generation in Ukraine had to adapt to new realities, where war became a backdrop to their formative years. For many, student life now means managing a “war-life balance”: attending classes in shelters, studying through power outages, fundraising for their friends and lecturers in the armed forces, and helping clean campuses after nighttime attacks.

Following the Russian invasion in 2022, the number of Ukrainian students enrolled in Western universities (EU, UK, USA, Canada) increased by 47% in the 2022/2023 academic year compared to the previous one, with Poland being the country with the largest share of Ukrainian students, accounting for 40% of the 115,000 Ukrainian students enrolled in Western higher education institutions in 2023/2024 (Stadnyi, 2025). This number is likely to rise further, given that 350,990 Ukrainian refugees aged 14–17 were living in Europe in September 2025 (Eurostat, 2025).

Survey responses: Students who chose to study in Ukraine highlighted the balance of education quality and affordability, as well as the convenience of staying close to family. Many also felt a strong patriotic commitment to contributing to Ukraine’s future and believed their chosen fields offered good opportunities at home.

Interviewees who had studied both in Ukraine and, at another stage of their education, abroad, noted that international experience broadened their expertise. They valued mobility programmes, double degrees, multicultural cohorts, and Erasmus exchanges. When reflecting on what could be improved in Ukrainian higher education, students prioritised more student-centred and practice-oriented teaching, such as interactive methods, discussion-based seminars, and case-based learning. They stressed the need for better access to international research databases, electronic libraries, and up-to-date literature, which remains limited in many universities. Interviewees also called for stronger career centres, internship programmes, company-based thesis projects, and mentorship.

More broadly, respondents argued that improving Ukrainian higher education requires increased investment in research, modernised infrastructure, deeper links with the private sector, and a stronger emphasis on critical thinking, analytical skills, and interdisciplinarity.

Safety has become one of the key determinants in the educational choices of Ukrainian adolescents, as parents encourage their children to seek safety abroad. However, a decisive factor for student migration is development and opportunities, rather than safety, according to the conducted survey (Figure 1). This finding is also consistent with the Index of the Future: Professional Expectations and Development of Adolescents in Ukraine (Shymanskyi et al., 2025, p.16).

Figure 1. Importance of different factors for Ukrainian students who chose to study abroad

Source: Primary survey data collected for this policy brief.

Speaking about the conditions under which they would be willing to return, respondents mentioned broader structural factors, including security and better career prospects in Ukraine after graduation (Figure 2).

Figure 2. Long-term return intentions of Ukrainian students studying abroad

Source: Primary survey data collected for this policy brief.

For many, Ukraine’s accession to the EU would signal long-term stability and opportunity (Figure 3). One interviewee described their participation in the Create Ukraine initiative, which brings internationally trained Ukrainians to work in government advisory teams on twelve-month placements. This example illustrates how targeted return schemes can channel international expertise into the public sector.

Figure 3. Perceptions of how Ukraine’s potential EU accession would affect opportunities for young people

Source: Primary survey data collected for this policy brief.

Student Mobility in Moldova

Background. Moldova faces an acute challenge of emigration, which results in a shrinking labour force, demographic imbalance, and growing pressure on the country’s social and economic systems. Emigration also affects the education sector, as universities operate with shrinking student cohorts and a shortage of qualified staff. While over 60,000 students are enrolled in 16 higher education institutions in the Republic of Moldova, approximately 14,000 Moldovan students pursue their education in the EU, and four out of five of them are in Romania (Munteanu, 2024; Moldpres, 2025). Economic challenges drive the emigration of young people, who leave in search of more stable career prospects and higher wages (Całus, 2025).

Moldova undertakes a variety of education reforms aimed at reducing incentives for students to leave in search of better-quality studies. Recent measures include simplifying the recognition of foreign degrees, increasing scholarships, expanding dual-education programmes, and launching a national online admissions platform (Eurydice, 2025). EU support reinforces these efforts by modernising university governance, improving labour-market relevance, expanding international cooperation, and strengthening research and innovation (Council of Europe, 2025).

Over the past decade, Moldova has also expanded its engagement with the diaspora, particularly in higher education, to promote knowledge exchange and professional networks (Baltag, Bostan & Plamadeala, 2023). Initiatives include short-term skills-transfer schemes that bring diaspora professionals into Moldovan universities for teaching, mentoring, or consultancy (Bureau for Relations with Diaspora, 2022). These efforts acknowledge that full return migration is unlikely in the near future, but circular mobility and diaspora engagement offer alternatives.

Survey responses. Moldovan students said they chose to study at home because of affordability, accessibility, and the relevance of local programmes. They valued learning in a familiar language and culture, and many hoped to build their futures in Moldova because of family ties and a desire to contribute to the country’s development. However, their educational decisions are shaped by political stability and economic prospects. Those who stay or return form a highly engaged group, actively involved in volunteer work, community projects, and local NGOs. By contrast, students open to leaving cited a weak job market, low wages, and limited opportunities, seeing study or work abroad as offering better prospects.

Students with experience in both systems emphasised the need for more practical learning, internships, company partnerships, real-world projects, and a wider range of electives, as well as stronger career guidance and mobility opportunities. Moldovan students studying abroad said they would be more attracted to domestic universities if curricula were modernised, programmes diversified, and links to the labour market strengthened. Many students abroad remain unsure about returning or plan to stay abroad due to low salaries, limited career prospects, weak institutions, and broader political and economic uncertainty in Moldova (Figure 4).

Figure 4. Long-term return intentions of Moldovan students studying abroad

Source: Primary survey data collected for this policy brief.

Similarly to Ukraine, the young population views the prospect of Moldova’s EU accession as a sign of economic growth, political stability, and improved business and career opportunities, which may motivate them to return and confidently build their future in Moldova. The majority of respondents agree that Moldova’s EU membership will improve opportunities for young people in the country (Figure 5). One of the interviewees shared, “Over time, if we reach that standard of living, I wouldn’t need to look for it elsewhere, because I would have it at home.” EU membership could help reverse the “brain drain,” depending on the pace of domestic economic transformation and the government’s ability to leverage integration to grow high-value industries that retain talent and boost economic growth (Gherasim, 2024).

Figure 5. Perceptions of how Moldova’s potential EU accession would affect opportunities for young people

Source: Primary survey data collected for this policy brief.

Conclusion and Policy Recommendations

In Ukraine, young people make their educational choices amid war and uncertainty. In Moldova, their decisions whether to study domestically or abroad are shaped by structural conditions. But in both countries, youth demonstrate a strong sense of identity, civic commitment, and desire to contribute to their countries’ future. Therefore, supporting these students requires a dual strategy: strengthening domestic higher education systems while maintaining close ties with those who pursue opportunities abroad.

For students who choose to remain in Ukraine or Moldova, the priority is ensuring that higher education institutions provide quality and relevance. At the same time, students abroad should be viewed as a community whose expertise, networks, and global experiences can play an important role in national development. Diaspora-engagement programmes implemented in Moldova are increasingly relevant to Ukraine to help maintain meaningful connections with human capital abroad.

The survey and interview data presented above suggest the following policy recommendations, relevant for both countries and reflecting the needs and expectations of young people.

Key recommendations:

  1. Keep strengthening the quality and relevance of higher education at home:
    1. Modernise curricula and enhance teaching quality by shifting toward methods that prioritise critical thinking and applied skills.
    2. Strengthen institutional capacity through international partnerships and expand the variety of courses and programmes to better match labour-market needs, including the development of joint courses that enhance relevance and quality.
    3. Promote career services through university-employer partnerships, internship programmes, company-based thesis projects and mentorship schemes that help students transition into the labour market.
  2. Maintain meaningful connections with students and young professionals abroad:
    1. Develop diaspora networks connecting students abroad with universities and employers at home.
    2. Promote public sector and private sector programmes that integrate internationally trained young professionals.
    3. Expand short-term exchanges: visiting fellowships, research collaborations, consultancy roles.

Mobilising the potential of young people in Ukraine and Moldova is essential for long-term resilience, EU integration, and economic growth. In turn, investing in education quality, labour market development, and diaspora engagement is a strategic investment in national development and human capital. Ultimately, retaining and reconnecting talent depends on broader security, political, and economic developments, especially progress on EU integration and successful reforms.

Acknowledgement

The author thanks Tatiana Cantarji and Cristina Varzari, students at the State University of Moldova, for their valuable assistance in distributing the online questionnaire among Moldovan students and conducting interviews. The author is also grateful to all survey participants and interviewees for sharing their time and insights.

 

References

Disclaimer: Opinions expressed in policy briefs and other publications are those of the authors; they do not necessarily reflect those of the FREE Network and its research institutes.

Steady Against the Wind: Ukraine’s and Moldova’s Path Towards EU Membership

Posted on November 3, 2025 |

Banner for SITE 2025 Development Day featuring the Ukraine and Moldova flags with event title “Steady Against the Wind: Ukraine’s and Moldova’s Path Towards EU Membership.”

The Stockholm Institute of Transition Economics (SITE) will host its annual Development Day Conference on December 5, 2025. This year’s theme, “Steady Against the Wind: Ukraine’s and Moldova’s Path Towards EU Membership,” focuses on resilience and reform. The event gathers policymakers, experts, and business leaders to discuss progress toward EU integration. Organized by SITE at the Stockholm School of Economics, it explores how Sweden and the EU can support both nations’ ambitions.

Background: The Long Road to EU Membership

Despite ongoing hardships, Ukraine and Moldova are steadily advancing toward EU membership. Both have carried out vital reforms, strengthened democratic institutions. However, major challenges persist. These include corruption, judicial reform, and the struggle to ensure territorial security. Institutional capacity also remains a key issue. Even so, the two countries continue to push forward, determined to secure a stable and European future.

Conference Themes and Goals

The SITE 2025 Development Day will feature a mix of presentations and panel discussions. The sessions will explore three main themes:

  • Economies & Support: Examining the economic outlook and the role of foreign aid in an uncertain world.
  • Democracy & Media: Fighting corruption and disinformation while promoting transparency through media and civil society.
  • People & Capacity: Building human capital, boosting institutions, and turning brain drain into brain gain.

The event will take stock of the current situation, draw lessons from past experience, and discuss how Sweden and the EU can best support the next steps.

Why It Matters

Ukraine’s and Moldova’s EU journey is more than a political process; it is a story of endurance. Their progress shows how reform and cooperation can thrive even in difficult times. Moreover, SITE’s Development Day 2025 offers a unique opportunity to reflect, collaborate, and shape the future of Europe together.

Join the Conversation

Entry is free, but registration is required. Venue details will be shared with confirmed participants. To register or learn more, visit the Stockholm Institute of Transition Economics (SITE) website or contact site@hhs.se.

Disclaimer: Opinions expressed during events and conferences are those of the authors; they do not necessarily reflect those of the FREE Network and its research institutes.

Development Day 2024: Integrating Ukraine, Moldova, and Georgia into the European Union

Posted on January 20, 2025 | Policy Brief

Flags of Ukraine, Moldova, and Georgia alongside EU flags in a conference setting.

For Ukraine, Moldova, and Georgia, integration into the European Union (EU) is a pathway to modernization, economic development, and increased resilience against authoritarianism. At this year’s Development Day Conference, hosted by the Stockholm Institute of Transition Economics (SITE), policymakers, researchers, and experts convened to discuss the shared challenges, opportunities, and reforms required for these countries’ successful EU accession.

This policy brief draws on the insights from the conference, briefly outlining the discussions across panels and presentations on governance reforms, hybrid threats, economic transformation, and security challenges.

The Geopolitical Context for Enlargement

The Russian invasion of Ukraine has intensified the European Union’s strategic focus on enlargement. Ukraine, Moldova, and Georgia find themselves at a crossroads, where integration into the EU is not merely aspirational but essential for safeguarding sovereignty and ensuring economic and political stability. The urgency of this enlargement stems from the need to counteract Russian aggression and bolster the EU’s geopolitical standing.

At the opening sessions of the Development Day Conference, three special guests offered their respective countries’ perspectives. Yevhen Perebyinis, Ukraine’s Deputy Minister of Foreign Affairs, underscored how Ukraine’s integration process aligns with its defense of European values against Russia’s aggression. Cristina Gherasimov, Moldova’s Deputy Prime Minister for European Integration, highlighted Moldova’s efforts to advance reforms while countering persistent Russian hybrid threats, including systematic election interference. Christian Danielsson, Sweden’s State Secretary to the Minister for EU Affairs, accentuated the necessity of ensuring that the EU is ready for enlargement, something political leaders now see as an imperative in the shadow of Russia’s war on Ukraine. Similarly, discussions emphasized Georgia’s historical and policy-oriented commitment to Europe, despite recent democratic backsliding and a recent pivot toward Russia.

Challenges on the Pathway to EU Accession

The integration paths of Ukraine, Moldova, and Georgia face numerous challenges. Critical areas for alignment with EU standards include governance reforms, anti-corruption efforts, and institutional capacity building. Moldova has made strides in public administration reform and jumped significantly on the Corruption Perceptions Index from 120th place in 2019 to 76th in 2023. However, persistent gaps in judicial independence and public procurement transparency remain hurdles. Similarly, Ukraine has enacted sweeping reforms under extraordinary wartime circumstances, reflecting a persistent and widespread commitment to European values. Yet, continued progress in judicial and financial oversight is essential, with the administrative framework in these areas needing improvement in both countries.

Russia’s hybrid warfare poses a persistent and evolving threat to democratic resilience across the region. Moldova’s elections in 2024 showcased large-scale, sophisticated interference by Russian actors. This interference began well before election day and continues in the form of disinformation campaigns and energy blackmailing in the Transnistria region. In Georgia, Russian influence compounds the challenges of domestic political unrest, particularly as the ruling party engaged in substantial electoral fraud and manipulation to secure its position in the 2024 October elections. These challenges highlight the need for robust countermeasures, including enhanced cybersecurity and strengthened democratic institutions across the candidate countries. It also points to the need for support from the international community, especially in the case of Georgia, where protesters are currently taking to the streets to challenge the widely recognized electoral fraud.

Economic transformation and alignment also remain a critical challenge. Ukraine’s economy, suffering wartime devastation, requires extensive reconstruction, with the cost of infrastructural damage alone nearing its annual GDP. Ukraine’s vast agricultural sector, a major player in global markets, will require careful integration into the EU to address compliance costs and alignment with the Common Agricultural Policy while maintaining its competitive edge. Moldova faces significant challenges in effectively communicating the benefits of EU integration to its population, a critical issue in countering Russian influence and maintaining public support for reforms. Despite clear economic progress, such as the increase in Moldovan exports to the EU, many Moldovans remain skeptical about the long-term benefits of EU alignment. This skepticism is particularly pronounced in regions like Gagauzia, where pro-Russian sentiment is strong and local populations are vulnerable to disinformation and propaganda.

As emphasized by multiple panelists, targeted communication strategies are vital to ensuring that the benefits of EU integration are understood across populations. Concrete examples—such as enhanced economic opportunities, improved infrastructure, and access to EU funding—must be clearly communicated to counteract Russian narratives and build broad-based support for EU accession.

In this regard, pre-accession funding offers a potentially transformative tool. The successful use of pre-accession funding in Poland in the 1990s and early 2000s demonstrates the potential for such resources to modernize infrastructure, connect markets, and build institutional capacity, a capacity that has later proved pivotal to overcoming democratic backsliding. Poland serves as a reminder that alignment and integration may take time, but also clearly showcases the economic and social benefits it can yield.

During the conference, security concerns were at the core of the enlargement discussion, with several panelists emphasizing NATO’s historical role as a critical security complement for EU member states. However, Ukraine’s potential EU accession may advance without parallel NATO membership. This raises significant challenges, as the absence of NATO guarantees leaves Ukraine vulnerable to further Russian aggression. Panelists highlighted the urgent need for the EU to adopt concrete security measures, such as strengthened hybrid defense capabilities, cybersecurity frameworks, and coordinated responses to disinformation—threats already witnessed in Moldova and Georgia. Additionally, ensuring Ukraine’s security would require increased military and financial support from EU member states to safeguard territorial integrity and maintain resilience against Russia, argued a necessity by several panelists.

The Opportunities of Enlargement

The integration of Ukraine, Moldova, and Georgia into the European Union offers profound opportunities for these states. It represents access to the single market, pre- and post-accession funding, and vital structural support that can accelerate modernization efforts. Overall, this can reduce the countries’ infrastructure gaps and cause an increase in foreign direct investment. Beyond economic gains, EU support drives crucial institutional reforms, enhances public administration capacity, and provides a framework for addressing corruption and strengthening the rule of law—key challenges across all three countries.

For the EU, enlargement would entail strategic benefits aligned with its new geopolitical focus and long-term economic goals. Ukraine’s reserves of critical raw materials, including lithium and titanium, are essential for Europe’s green transition. Furthermore, Ukraine and its defense industry offers strategic benefits to Europe by bolstering collective security. Its agricultural capacity remains pivotal not only for the EU but for global food security, and its IT sector provides additional growth potential. Moldova and Georgia, on the other hand, offer untapped market potential and workforce integration opportunities, which could strengthen the EU’s competitive edge. Enlargement also represents a critical opportunity to counter the threat from Russia, manifesting the Union as a geopolitical leader committed to stability, democracy, and shared values.

However, as voiced throughout the conference, the EU must prioritize clear communication of these benefits. Concerns about increased competition in existing member states need to be met with transparency while communicating the long-term economic and security advantages of enlargement. Involving the business perspective in the enlargement process and ensuring that both candidate countries and current EU citizens and businesses see tangible benefits early in the process will be key to sustaining both momentum and public support. Such messaging could include the fact that the EU is originally a peace project and that the counterfactual scenario to the current enlargement ambitions is Russia and its wars creeping even closer to the Union’s border. In regard to the business sector, it could be emphasized that enlargement associated risks can be met with risk sharing instruments and credit guarantees.

As emphasized by several speakers, the EU also needs to ensure that it is ready for enlargement in terms of capacity. As the EU was not initially built to be this large, a further expansion requires the Union to critically reflect on how to ensure it will stand up for the rule of law and all member states’ adhesion to EU principles in the years to come.

Concluding Remarks

How to facilitate the accession of Ukraine, Moldova, and Georgia into the European Union was the topic for discussion at the 2024 Development Day. The discussions highlighted the substantial early progress and rapid reforms undertaken by Ukraine while being a country at war. Moldova’s steady progress toward its ambitious 2030 accession target underscores its commitment to reform, though challenges remain in securing public trust and countering Russian interference. Georgia, meanwhile, serves as a warning of how quickly democratic gains can erode, with political turmoil and Russian influence threatening its European path. These examples underscore the need for sustained support and clear communication of the benefits of EU integration. Panelists and participants also underscored that integrating these nations is not merely about expanding the EU—it is a vital response to ongoing geopolitical threats, in particular from Russia, and an affirmation of the EU’s foundational values.

Ultimately, the enlargement of the EU to include Georgia, Moldova and Ukraine holds significant potential, both for the aspiring members and the EU itself. However, as the discussions at Development Day 2024 showcased, such enlargement requires robust partnerships, unwavering and early support, and a recognition that integration strengthens the EU as a whole, ultimately positioning the EU as a much-needed major democratic geopolitical actor.

List of Participants

Disclaimer: Opinions expressed in policy briefs and other publications are those of the authors; they do not necessarily reflect those of the FREE Network and its research institutes.

The 2024 FREE Network Retreat: Economic Research and Capacity Building in Moldova

Posted on October 28, 2024 | Policy Brief

Panel discussion on capacity building in Moldova and research within the FREE Network experience with experts from ISET-PI, BEROC, BICEPS, CenEA, and SITE

The 2024 FREE Network Retreat, held in Chisinau, Moldova on September 11-13, brought together representatives from the FREE Network institutes and other stakeholders, focusing on economic research and capacity building, especially in the context of Moldova’s EU accession efforts. The event featured general sessions on institutional development, special tracks on academic, administrative and communication topics, and a half-day conference on “Economic Research and Capacity Building“. Key discussions addressed challenges such as Moldova’s weak economic research infrastructure, policymaking gaps, and the need for capacity building. Several examples of Moldovan success stories were also highlighted. The event concluded with a call for strengthened collaboration and donor support towards economics education and fostering Moldova’s research and capacity-building landscape.

Introduction

The FREE Network Retreat is an annual event for researchers and administrators from the FREE Network institutes. The 2024 Retreat took place in Chisinau, Moldova, September 11-13 and was attended by representatives from BEROC (Belarus – currently in exile in Lithuania), BICEPS (Latvia), CenEA (Poland), ISET (Georgia), KSE (Ukraine) and SITE (Sweden). In addition, although not being a member of the FREE Network, the New Uzbekistan University in Tashkent and its Greater Eurasia Research Center (GEAR) were represented.

Like at previous retreats, there were two general sessions with a focus on the development of the individual institutes and the Network as a whole, and three tracks of special sessions on academic, administration and communication topics. The Retreat also involved a meeting of the FREE Network’s joint initiative The Forum for Research on Gender in Eastern Europe (FROGEE) – and a special side event on the integration of Ukrainian Refugees in Moldova.

An integral part of this year’s Retreat was the half-day conference, “Economic Research and Capacity Building”. Drawing on the FREE Network’s experience, the conference focused on how capacity building and research can facilitate the transformation of societies and economies, particularly within the Moldovan context, on its path towards EU-accession. In addition, it provided the FREE Network members an opportunity to share their experiences of capacity building, economic research and policymaking with Moldovan stakeholders.

The Conference was open to external participants interested in the topic, particularly policymakers, academics, and think tank representatives. It clearly illustrated the need to strengthen not only economic research and capacity building but also academic education in economics and related fields, improve the quality and access to data, and raise the level of competence in economics within the government and public sector in general.

A summary of the Conference discussions is provided below. For a full overview of the program and participants see the Appendix.

The Opening Session

The opening session started with the general observation that EU integration, in addition to being a political and security issue is primarily an economic issue with a need for economic research and analysis that can inform policy discussions and educate current and future stakeholders. Within this context, all the FREE Network institutes have considerable experience engaging in research and discussions of policy and policy reform within the region. With Moldova not (yet) represented in the FREE Network, the Conference served as a platform for the Network to learn and eventually engage in sustainable partnership(s).

The discussion then shifted to the Moldovan situation and the challenges ahead on the path to EU membership. Several challenges were identified: a lack of economic research, with most existing research being rather weak; missing connections between researchers and policymakers; a shortage of human resources; and generally weak institutions; as well as policies often being based on trial and error rather than evidence-based decision-making.

To address these challenges several actions were suggested including the need to strengthen research and independent economic thinking through capacity building; drawing on the experience of the countries that have joined the EU during the last two decades; developing international research cooperation through networks like the FREE Network; business-friendly practices and treating investors right while at the same time encouraging entrepreneurship and educating society on the importance of private and public investments.

The discussion also addressed activities supporting civil society undertaken by the EU and Sweden, respectively. Examples of activities include building partnerships and strong ecosystems for innovation and entrepreneurship, supporting reforms cutting red tape and improving the business climate in general as well as supporting the Academy of Economic Studies Moldova and the Association of Women in Business.

Research and Capacity Building – the Moldovan Perspective

The discussion started with a presentation of three Moldovan success stories. The first one is a recently launched program on media, gaming development and animation. Currently, 1,000 students are being enrolled. The program attracts Moldovans from all over the country as well as Moldovan students abroad who decided to terminate their studies abroad to go back to Moldova and enrol in the program. The success of the program is a good example of cooperation between industry, higher education institutions and the Ministry of Education opening up to new professions and programs that attract young people.

The second example is taken from the fashion industry. Traditionally Moldova has been a country where sewing takes place thanks to cheap labor. However, in recent years a “pipeline” of talent, design and brands has developed. As a result, the value added in the industry and export revenues as well as wages have increased.

The final example is the Moldovan tech industry. The tech industry has been at the forefront and could be considered the tiger of the Moldovan economy with growth rates of 30-40 percent per year. There are two main reasons behind this success: the rapidly developing Moldovan startup scene combined with a 7 percent single tax mechanism for the tech industry.

The discussion then turned to the role of research in policymaking. The first argument put forward focused on the impact (or rather the lack of impact) of research and analysis on Moldovan policymaking. As the examples above show, the Moldovan economy has the potential to develop – however, the policy discussion does not focus on the transition towards higher-value activities. On the contrary, even though Moldovan research highlights the role of transition to higher value-added, this argument has essentially been ignored in the policy debate that has been mostly characterized by rhetoric on job creation rather than transition to an economy that creates jobs within the high(er) value-added sectors. Unfortunately, this is not the only example of Moldovan policy discussions and decision-making ignoring the research perspective and outcomes. Among other examples mentioned is the recent tax reform experience and programs supporting Small and Medium Sized Enterprises. Currently, reforms are driven either by purely political reasons or by lobbying or by any other vested interests. There is essentially no impact assessment or any economic analysis underpinning the decisions. Due to the fact that policy initiatives neither are based on economic analysis  nor on best practices, they are vulnerable to clientelism or corruption. The importance of rule of law was emphasized in light of Moldova’s anchoring to the EU and with reference to Latvia and the other Baltic states. It is a too important topic to be left to the lawyers and should hence be part of economic capacity building and research.

The second argument referred to access to reliable data needed for quality policy-oriented research. While the data collected by the National Bureau of Statistics in general is good, the main issue lies in accessing it. The Bureau does not have the resources to support researchers. To exacerbate the problem further, there seems to be no willingness among policymakers to address this issue. Given Moldova’s vulnerability to Russian disinformation and the increased pressure on Moldova, the issue of access to reliable data is even more pressing today than a few years ago.

To foster an informed policy debate and decision-making process taking evidence-based research into account, it would be desirable to create a platform to advocate the results of economic policy analysis where, e.g., policy papers and monitoring reports, could be presented and discussed by experts and decision-makers in the public and private sectors as well as the civil society.

The session continued with a discussion on human capital. The successful program attracting Georgians in the diaspora to return and work for the Georgian government, launched during the first decade of the 2000s, served as the point of departure for the discussion. The key to the success in Georgia was that the government was able to pay competitive salaries. This is one of the main challenges facing Moldova. Even though there have been some adjustments in government salaries during recent years, the government is still far from being anywhere close to paying the same salaries as the private sector in general and think tanks in particular. An understanding of this is important not only at the national level but also among donors. It was noted that there have been some adjustments in government salaries, but it has not been enough. Further, while the Moldovan diaspora are starting to return, they, however, have little governmental or political experience, which makes it difficult to involve them in, e.g. policymaking and development of support programs. It would be good to draw on experiences and best practices from other countries in the region – such as the Baltic states and Georgia – and use them as benchmarks, e.g., for the innovation ecosystem, incubators and accelerators.

Research and Capacity Building – the FREE Network Experience

The FREE Network institutes shared their experiences in capacity building and brain gain, developing an economics undergraduate program, research and policy impact, and network building through research.

ISET (Georgia) shared their experience on attracting talented economists in the Georgian diaspora back to Georgian academia, research, and government positions. The starting point was an initiative developed in collaboration with the donor community to establish a world-class economics school in the Caucasus – the International School of Economics (ISET). The school has developed from a small boutique school to a school with three academic programs (undergraduate and graduate) and about 700 enrolled students. ISET graduates are in high demand and are seen in the private and public sectors. The ISET Policy Institute plays a pivotal role in terms of contributing to evidence-based policymaking. Throughout the years more than 50 ISET graduates have been accepted in Ph.D. programs at top universities worldwide. Many of them have returned to Georgia and ISET after completing their Ph.D. Had not it been for opportunities offered by ISET and the Policy Institute, it is very unlikely that they would have returned. The FREE Network and the opportunities offered are a great resource for the ISET as well as for the ISET Policy Institute.

BEROC (Belarus – in exile in Lithuania since 2022) shared their experience on the process of creating and launching an undergraduate program in economics and business. BEROC started as a research center, but the idea to establish a Bachelor program in economics and business had been around for several years. As part of the re-organization and reformation of the European Humanities University (Belarusian, but in exile), the European Commission approached BEROC asking if it could develop an undergraduate program in economics and business for Belarusian students.

The challenge has been two-fold: first, in the current political situation, Belarusian people are “locked within the country” and for them it is much easier to go to Russia for studies. In addition, the cost of living and the tuition fee (although low by Baltic standards) provide additional barriers to potential students. Second, BEROC operates in exile themselves. Nevertheless, a Bachelor program in economics and business will be launched in October 2024 with the support of Belarusian business in exile. Thanks to cooperation with partners within the FREE Network the program is at the global frontier.

BICEPS (Latvia) provided an overview of how research can contribute to the policy agenda. BICEPS’s first policy reports, published more than 15 years ago, focused on the unsustainable Latvian economic growth and inflation levels at the time. These reports reached conclusions that, while correct ex-post, were contrary to those of the Latvian Central Bank. This divergence sparked substantial discussion at both the political level and in the media.

In the early 2010s, BICEPS was commissioned to produce the first-ever Latvian Competitiveness Report. This report has served as a foundation for policymaking and has left a lasting mark on the policy agenda. Furthermore, following BICEPS’s research on the shadow economy and the annual presentation of the shadow economy index, the Ministry of Finance, through public procurement, commissioned a 2021 project to develop a model addressing the impact of the shadow economy.

The Global Entrepreneurship Monitor (GEM) Latvia and the EUROMOD tax-benefit microsimulation model are long-term projects run by BICEPS. Current projects include one focused on the impact of broadening the sugar tax base, a regional Global Entrepreneurship Monitor study, a project on road congestion tolls in cities and the development of sustainable agriculture in Africa.

CenEA (Poland) might be small in terms of people employed, but disproportionally big in terms of impact and presence in the Polish policy discussion. From the very beginning, CenEA has aimed at combining policy with solid economic research. The focus has primarily been in the areas of fiscal policy, ageing and health – with the latter two being major issues in Poland.

For CenEA, the FREE Network has been fundamental, both for funding and for building its credibility and position. CenEA has played an active role in terms of broadening and deepening the cooperation within the FREE Network. It has been very active in developing and coordinating the FROGEE project. The project (financed by the Swedish International Development Cooperation Agency, SIDA) has run for six years and covered a wide range of topics within the field of gender equality. It has resulted in several FREE Policy Briefs, policy and research papers, and several conferences and workshops. In addition, the project has contributed to the development of tools and skills for both senior and junior researchers within the Network. Based on the success of the FROGEE project, new projects and initiatives within the Network have been developed.

SITE (Sweden) has taken the lead on the FREECE (the Forum for Research on Eastern Europe: Climate and Environment) project. The project has been around for eighteen months with a focus on the transition from an economy based on the production and consumption of fossil fuels to an economy based on the production and consumption of zero-carbon renewables. This will be a challenge for everyone, especially for countries throughout Eastern Europe that often rely on the extraction and consumption of fossil fuels for employment as well as for energy needs.

The FREECE project provides several opportunities to engage in policy-relevant research while at the same time filling a gap in the literature.

Initiatives and the Road Ahead

At the current stage of Moldovan economic and political development there is a higher demand for analysis and applied research, rather than general and theoretical research. In other words, policy relevance needs to be in focus. At the same time, such applied analysis and research need to involve well-educated human capital with relevant skills, such as university graduates. This puts focus on the role of universities and how they can reform.

The Moldova School of Economics initiative was launched approximately half a year ago. Among the first activities were public lectures on economic behaviour and public policies. In September, in cooperation with CERGE-EI in Prague, the first short economics course was launched. Currently, there are discussions with the Ministry of Education and the State University on developing the initiative into an actual program. So far, the response has been positive. The vision is to create the Moldova School of Economics into an initiative that reaches out not only to Chisinau and Moldova but to the wider region.

The session on this topic proceeded to discuss how the FREE Network could support Moldovan research and capacity building, focusing on its experience in implementing various projects. One potential starting point would be a summer school involving both the FREE Network and Moldovan economists living abroad. There are already contacts with members of the diaspora who have expressed a willingness to participate as faculty members, without compensation. Additionally, there is a need for shorter courses or executive classes aimed at individuals in ministries. Topics to be covered may include basic macroeconomic analysis, fiscal policy, and economic growth. It is also important to incorporate microeconomic subjects, such as the factors driving innovation and the development of economic clusters.

Concluding Comments

The FREE Network Retreat and conference has shown that many of the issues currently facing Moldova, have at least partly been addressed by the FREE Network members in their respective countries. Looking forward this should provide a good basis for cooperation between the Network and Moldovan partners. Three broadly defined areas for collaboration and partnerships were identified: (i) education and training: at the university level as well as for ministries and government agencies; (ii) creation and development of a good environment for research and policy analysis; (iii) communication and outreach.

The dialogue that has been initiated during the conference should continue and include a discussion on how to attract donors to support long-term cooperation that contributes to the needed strengthening of research and capacity building in Moldova.

Appendix

Conference Programme: Economic Research and Capacity Building

9.30 Conference Opening

  • Torbjörn Becker, Director, Stockholm Institute of Transition Economics
  • Jānis Mažeiks, Ambassador of the European Union to the Republic of Moldova
  • Katarina Fried, Ambassador of Sweden to the Republic of Moldova

10:00 Research and Capacity Building – the Moldovan perspective

  • Doina Nistor, Chief of Party, Moldova Future Technologies Activity
  • Adrian Lupușor, Executive Director, Independent Analytical Center Expert-Grup
  • Kálmán Mizsei, EU Adviser to the Government of Moldova

10:50 Research and Capacity Building: The FREE Network Experience

  • Tamar Sulukhia (ISET, Georgia): Capacity building and brain gain
  • Dzmitry Kruk (BEROC, Belarus – in exile): Development of a new academic programme
  • Marija Krūmiņa (BICEPS, Latvia): Research and policy impact
  • Michal Myck (CenEA, Poland): Network building and the FROGEE experience
  • Julius Andersson (SITE, Sweden): Network building and the FREECE experience

11:30 Initiatives and the Road Ahead

  • Mihnea Constantinescu, Advisor to the Governor National Bank of Moldova
  • Misha Zeldin-Gipsman, the Moldova School of Economics Initiative

12:10 Concluding Comments

  • Torbjörn Becker, Director, SITE
  • Kata Fredheim, Associate Professor, BICEPS and Stockholm School of Economics in Riga

12:20 Lunch and Networking

Conference moderator: Kata Fredheim, BICEPS and SSE Riga.

Disclaimer: Opinions expressed in policy briefs and other publications are those of the authors; they do not necessarily reflect those of the FREE Network and its research institutes.