Moldova has been warned that €100m (£87m) of EU funds will remain blocked until the government rethinks a law on the voting system and cracks down on rampant corruption.



Siegfried Mureşan, vice-chair of the European parliament’s budget committee, said Moldova’s EU funds would remain frozen because the government had failed to meet conditions on respect for the democratic process.



“We are ready to make the money available,” Mureşan told the Guardian. “This is the right thing to do for a country in the immediate neighbourhood of the EU to contribute to increasing stability, both economically and security wise. But we said subject to conditions.”

The EU has pencilled in €60m in loans and €40m grants in 2017-18 to help the former Soviet republic stabilise its economy and carry out reforms.

The funds were frozen last year, after Moldova’s government pushed ahead with a new electoral law, despite warnings from the Venice commission, experts who advise the Council of Europe on law and democracy.

Moldova’s electoral law could mean local politicians end up in the pockets of well-resourced businesspeople. In a report published last month, the Venice commission reiterated previous warnings that the law risked “undue influence and manipulation” of the political process by businesspeople pursuing their own interests.



“The European commission said ‘please apply all recommendations of the Venice commission from A-Z’,” Mureşan said. “And that is what they have not done so far and that is what we expect them to do as a precondition for disbursing the macro-financial assistance.”

The Romanian MEP, who is leading a European parliament delegation to Chisinau, said the EU was also worried about corruption, following a colossal banking scandal that robbed locals of one eighth of economic output.



Known locally as the theft of the century, $1bn was stolen from Moldova’s banking system in 2012-14, roughly 13% of GDP, a huge sum for one of the poorest countries in Europe.



The lost funds have not been recovered and the complete version of an investigative report has not been published, the European commission noted in a report this week, adding that this casts “doubts on the real will to prosecute this culprit of the fraud”.

The prime minister, Pavel Filip, who came to office after his two predecessors were brought down by the scandal, has previously said he is confident Moldova will unlock the EU’s €100m in 2018.