Can Moldova Point the Way Through Europe’s Rural-Depopulation Challenge?

Across much of Europe and other advanced economies, ageing populations, low fertility rates and rural outward migration are undermining growth prospects and testing the social contract between generations. Experts have warned that, in some regions, these pressures could create demographic deserts – areas in terminal decline, where those who remain struggle to access services and economic opportunities. Analysis by the Financial Times shows that in the decade from 2014 to 2024 the estimated number of people living in predominantly rural European Union regions fell by nearly 8 million, an 8.3 per cent drop. Over the same period, the population living in predominantly urban EU areas grew by 6 per cent.

These demographic shifts have triggered debate among policymakers on how to respond; examples range from locally run initiatives such as the “one-euro house” schemes in Italy to EU-sponsored programmes for rural and regional development. Yet the measurable impact of these interventions has remained limited. This has raised a more difficult question: rather than working to delay or reverse depopulation trends, should policymakers accept reality and focus on the more fundamental challenge of how countries and communities adapt to ongoing urbanisation while ensuring equitable access to services, opportunities and democratic participation for rural dwellers? In other words, can governments choose to adapt sustainably to these alarming demographic shifts?

Inside Moldova’s Demographic Challenges

Moldova, like many Eastern European countries, has been at the forefront of depopulation trends for the last 35 years. Between 2014 and 2024, populations in all raions (regions or counties) except the capital, Chișinău, declined. In 28 of the 32 raions, the decline exceeded 20 per cent. This long-term trajectory has been driven by a combination of factors.

First, the transition from a communist system to a free-market economy after the fall of the Soviet Union caught much of Eastern Europe unprepared. Heavily agricultural regions such as Moldova were particularly hard hit, with high unemployment, soaring inflation and weak, newly established institutions. Meanwhile, the Soviet Union had limited freedom of movement and tied people to their assigned workplaces and regions; its dissolution brought new freedoms and, with them, outward migration.

Second, because of massive outward migration and economic hardship in the 1990s and 2000s, Moldova’s birth rate fell sharply and has remained low. Many young people left during their prime reproductive years, while those who stayed often delayed or avoided having children due to unemployment, poverty and social insecurity. This created a demographic spiral that has become chronic: each generation is smaller than the last, leaving fewer potential parents for the future. The effects are felt most acutely in rural areas, where youth migration, ageing populations and shrinking local economies combine to perpetuate decline.

Chișinău has traditionally offered more employment options due to its scale, status as the national capital and role as Moldova’s main logistics hub, but other localities have struggled to provide adequate services and economic opportunities. Rural villages have been worst hit, with ageing populations and deteriorating public services. These communities risk becoming ghost towns; constrained financial and human resources have limited their ability to transition to modern, competitive agriculture or other higher-value industries. Moreover, reskilling policies and employment opportunities in the private sector have remained limited, driving migration either to Chișinău or abroad.

According to the 2004 census, Moldova had 3.3 million citizens served by around 900 local governments. As of September 2025, Moldova still had 893 local governments, but these serve only 2.4 million citizens; more than half of these fall below the legal minimum threshold of 1,500 inhabitants required to form a local government. These small units struggle with limited budgets, staff shortages and residents’ growing expectations of public services. Population decline is ongoing – and accelerating in many of the smaller communities.

In response to delivery gaps, the central government has gradually centralised key services, such as education and social assistance. In its Public Administration Reform (PAR) Strategy for 2023–2030, it has also committed to addressing challenges and equipping future-proof local administrations with tools to drive necessary reforms.

Towards a New Model for Local Governance

Like most modern states, Moldova’s public sector is overstretched. Managing the demands of an increasingly complex economy, a digital ecosystem requiring significant capital and technical skills, and citizens’ rising expectations for better, tailored interventions – all against the backdrop of a shrinking population – would test any administration. These pressures are compounded by geopolitical realities of Moldova’s position between the competing EU and Russian spheres of influence.

However, an opportunity exists to pursue important structural changes. Moldova has a chance to reinvent its system of local and regional government, backed by a strong political mandate to drive reforms and a national growth plan that emphasises modernisation and efficiency. While progress on the PAR agenda has been relatively slow, there is growing recognition of the need to prepare local governments to effectively plan for, manage and absorb future EU funds. This momentum is further reinforced by substantial international support, which has created favourable conditions for advancing sustainable reforms.

The starting point must be a leaner and smarter system, built around fewer but stronger local authorities that can pool resources and deliver services at scale instead of struggling in isolation. The central government could focus on setting rules and standards for urban planning, infrastructure and service provision along with making strategic investments, while also devolving power where appropriate to these newly empowered local authorities. A strong, efficient digital backbone must underpin the whole system, making services accessible to citizens wherever they live while cutting duplication and cost.

This reformed system would need to guarantee basic services – for example, education, health care, social protection – while driving job growth and investment in secondary cities and rural communities. In practice, this would require embracing new partnerships as well as new technology: local administrations working with businesses, civic groups and community organisations to solve problems together.

Success could be measured in two ways: whether Moldovans, wherever they live, can obtain the services they need and trust the institutions that deliver them, and whether the system can be sustained in the long term with the resources available. If executed well, Moldova could become an example of a reimagined state – one that harnesses technology-enabled modern delivery to transform how government serves its citizens.

To adapt to outward rural migration, action is needed at four levels: in Chișinău as the largest urban hub, in other urban areas, in rural communities and at the regional level.

1. Chișinău

A regional planning and coordination mechanism (underpinned by a clear and coherent urban plan) should be rolled out for the entire metropolitan area. Both the capital city and its suburbs should be obliged to comply with this mechanism to help manage urban growth in a controlled and balanced way. A density-based approach to urban metropolitan planning can prevent uncontrolled sprawl that risks overburdening the local and central governments with requirements for far-flung public-service provision. Coordinated planning could help ensure all communities in the metropolitan area can access housing, as well as provide accessible education, health, social and other public services. Better-coordinated service provision could also lead to less traffic as more housing, work locations and public services are co-located.

2. Other urban areas

Cities such as Bălți, Cahul, Ungheni and Orhei can serve as regional engines of growth. These cities, and others, could provide alternatives to Chișinău’s competitive job market and high housing costs, but would require dedicated support to attract people from rural areas through smart economic specialisation. They also need stronger transport links with each other, with Chișinău and with nearby rural localities so that rural residents can benefit from the opportunities created.

3. Rural communities

These communities have been worst hit by population decline, particularly those isolated from urban centres. Their structure is changing; local governments must recognise this new reality and adjust accordingly to provide vital services. Measures could include:

• Policies aimed at the elderly. Supporting active ageing by providing socialising opportunities, sports, cultural activities or even communal work can enhance people’s quality of life and create a meaningful environment for older residents.

• Smart rural tourism. Niche opportunities in remote, cultural or folk-based tourism could revive certain areas. These kinds of initiatives cannot be scaled nationwide, but can be led by the private sector and create numerous jobs in rural areas.

• Service sharing among local governments. Where capacity exists, cooperation between municipalities could help improve service delivery. Many communities have older public-sector workers and limited pools of new recruits. Creating a political and regulatory framework that allows for shared resource provision or shared services across communities could help these local governments meet residents’ needs.

• Amalgamating local governments. Political leaders could also consider further incentivising and accelerating mergers of geographically close but capacity-constrained local governments into a single stronger authority to improve services and potentially increase economic activity. Amalgamation (also known as consolidation) can help create scale and increase the quality of services, as well as easing staff shortages that exist in smaller communities. Many of these reforms are politically sensitive, because a local community can be part of an individual’s identity. However, the experiences of countries such as Finland, Estonia and Denmark show that with effective communication these kinds of reforms can help strengthen communities by creating more effective local governments, greater economies of scale and stronger institutions capable of absorbing EU funds. This, in turn, could foster a more robust rural economy and environment, improve connectivity to urban centres and potentially mitigate rural depopulation.

4. Regional governance

Moldova’s raions have long been seen as a symbol of bureaucracy and a legacy of the Soviet administrative system. In practice, these regional governments have struggled to deliver quality services and have lost many of their responsibilities as the state has sought to centralise provision to improve outcomes. To address these challenges, Moldova could consider a restructuring process that redefines the role of regional governance. A new model should focus on strengthening regional development, improving service delivery and attracting more investment. Aligning future regional divisions with the EU’s NUTS (nomenclature of territorial units for statistics) classification system would also simplify the absorption of European funds and support Moldova’s broader integration goals.

Turning Challenge Into Opportunity

The way forward is not a simple choice between keeping every village alive or merging them into anonymous regional units. Instead, it is about rethinking how the state meets people where they are. That means building larger, smarter local authorities that can plan and invest at scale. It also means using digital tools to deliver services beyond physical boundaries, strengthening secondary cities as regional anchors and creating a governance culture where citizens feel part of decisions even if their village no longer has its own mayor.

If Moldova succeeds in this reinvention, it could become an unlikely European pioneer. A country once defined by rural decline could show how to turn demographic loss into an opportunity for smarter, more sustainable governance – an example other European states may one day need to follow.