Abstract
Income inequality has greatly increased in the Republic of Moldova since its independence in 1991. This is partly because only a small number of its people became rich through the illegal and unfair redistribution of the national wealth in the process of regime transformation, and partly because the majority of the people were reduced to poverty by the bankruptcy of the national economy. As a result, serious poverty has spread widely in small towns and rural areas, especially among unskilled workers, farmers, agricultural employees, pensioners, those with no primary education and the illiterate, households with many children, children and old people. Poverty has caused a sharp decline in fertility and the migration abroad of 600 thousand to one million workers. While their remittances to their families have prevented a worsening of the economic and social situation in Moldova, this labour emigration has given rise to a brain drain and to human trafficking. This in turn contributed to the great victory of the Communist party in the 2001 elections. Whether these issues of social and economic inequality and mass labour migration will be eased by the EU's ‘European Neighbourhood Policy, ’ which is based on a carrot and stick approach, remains to be seen.
