ECO-BUS WEEKLY DIGEST March 16-22. Most important Economy & Business news by IPN
● MONDAY, March 16
National Bank explains risks posed by financial products
The risk represents the probability or the threat of damage, injury, loss or any other situation caused by external or internal vulnerability and that can be avoided by particular preventive actions. Information about the risks posed by financial products is published by the National Bank of Moldova as part of the information campaign launched together with the National Commission for Financial Markets within the financial education project “Learn. Give Sense to Money”. The financial risks reside in the deterioration of the value of owned savings or investments or in the unexpected rise in interest rates on taken out loans. A financial product can pose a number of simultaneous threats
Banks reduce working hours
The commercial banks operating in Moldova reduced the work program as of March 16 in connection with the novel coronavirus pandemic. A part of the branches were closed. To minimize the risk of infection among employees and customers and to prevent the spread of COVID-19, Mobiasbanca – OTP Group closed some of the branches and decreased the number of employees on duty. The customers will be served as usual, but only at the available branches, which are indicated on the bank’s website.
● TUESDAY, March 17
Concept of program “Home Appliances in Exchange for Scrap” proposed for Moldova
A program similar to “Home Appliances in Exchange for Scrap” of Romania could be implemented in Moldova. This enables the people to exchange old home appliances (fridges, TV sets, washing machines, etc.) for new ones on the presentation of a voucher issued to each beneficiary. The condition is for the new electrical appliance to belong to an energy efficiency class A+. The proposals were included in the ECIPES (European Cohesion by Individual, Public and Entrepreneurs Support) program developed by Iurie Calestru and Gabriel Mărgineanu, of the Institute for Project Development and Expertise
Bank defers payment of interest on loans for three months
Moldova Agroindbank decided to put off the payment of interest rates on loans and also on deposits until May 31. The reimbursements will be made in June at the client’s request. By this measure, the bank aims to support the clients-private individuals in the situation caused by COVID-19.
● WEDNESDAY, March 18
NAER suspends application of charges on electricity produced from renewable sources
The implementation of the National Agency for Energy Regulation’s decision on the approval of fixed charges and ceiling prices on electrical energy produced from renewable sources of energy by producers that will obtain the status of eligible producer in 2020 was suspended, as was the process of publishing the decision in the Official Gazette. About the date of coming into force of the given decision, the NAER will additionally inform the potential eligible producers of electricity from renewable sources. This will yet happen when the state of emergency is lifted, the Agency stated in a press release.
National Agency for Energy Regulation sues Termoelectrica
The National Agency for Energy Regulation filed a lawsuit against the Chisinau heat supplier SA Termoelectrica. The company is asked to provide explanations over the high sums indicated in the heat bills for January 2020 following complaints filed by consumers, including the online petition signed by 2,630 persons. In a press release, the Agency said it examined the data concerning the temperature of heat supplied through the heating system by Termoelectrica and checked the correctness of issuing heat bills by the company. It established that the invoicing period for this January was 32-36 days on average. This runs counter to the regulations on the supply of heat, which provide that the heat consumption should be invoiced monthly.
Business entities make donations for doctors and patients with COVID-19
A number of business entities made donations in support of medical staff and patients affected by COVID-19. Iute Credit Moldova decided to donate 100,000 lei to the National Clinical Hospital “Timofei Moșneaga”. The sausages company Rogob also donated 100,000 lei. The money went to the Infectious Diseases Hospital “Toma Ciorbă”. iTaxi company announced that in gratitude and respect, it offers the medical staffs 900 free taxi rides so that they could easier reach the Infectious Diseases Hospital “Toma Ciorbă”, the National Clinical Hospital “Timofei Moșneaga”, the Emergency Medicine Institute or the Municipal Children’s Contagious Diseases Hospital. The real estate company Proimobil during a week as from March 17 will deliver food products to the Municipal Children’s Contagious Diseases Hospital and the Emergency Medicine Institute.The restaurant “Trattoria della nonna” delivers 20 free warm lunches a day to the homes of persons from risk groups, such as elderly people from Chisinau, who do not have relatives and need assistance. It also offers warm meals to staff of the Hospital “Toma Ciorbă”.
NBM takes measures in support of private individuals who took out bank loans
The Executive Board of the National Bank of Moldova (NBM) issued a decision by which it allows the licensed banks to flexibly manage the payment obligations of private individuals in difficulty of paying for the raised loans given the declared state of emergency. The decision facilitates the provision by licensed banks of concessions on the payment of interest on loans taken out by private individuals until May 31, 2020. In a press release, the NBM says these measures could be applied selectively and individually by the banks, in accordance with the own capacities, regulations and contract clauses. At the same time, the central bank’s decision determines the necessity of prudently managing all the risks so as to maintain the stability of the banking sector and to protect the depositors.
Parcels blocked in post offices are stored for indefinite period of time
In connection with the suspension of international flights, the receipt of postal parcels was stopped, Moldova’s Post Office has said. Even if the authorities assure that the postal parcels are not a source of infection with COVID-19, Moldova’s Post Office informs the customers that the volume of international postal items accumulated from all over Moldova could not be dispatched. It was thus decided to store the collected parcels in the storerooms of the Mail Processing and Transportation Center for an indefinite period of time. The customers will be additionally informed when the parcel distribution service is resumed through the website of Moldova’s Post Office or by a mail to the addressee’s cellphone.
● THURSDAY, March 19
Microenterprises risk going bankrupt after closure, AIM director
The microenterprises risk going bankrupt as they lack reserve financial resources and owing to their total or partial closing, executive director of the Alliance of Small and Medium-Sized Enterprises of Moldova (AIM) Liliana Busuioc stated in a meeting with Ion Chicu. She asked to consider a sector approach to the support measures taking into account the businesses that were most affected by the state of emergency. According to a press release of the AIM, Liliana Busuioc spoke about the abuses committed by the police and requested the Government to provide clear information as regards the interpretation of the law to the business community so as to avoid abuses and constraints.
Cashless transactions in first quarter of 2019 at 3.1bn lei
The value of cashless transactions in the first quarter of this year was 3.1 billion lei, an increase of 48.7% compared with the corresponding period last year. The National Bank of Moldova says the cashless payments represented 60.8% of all the local operations in the period, while cash withdrawals 39.2%. As regards the value of operations performed by card, cash withdrawals constituted 81.6%, while cashless payments 18.4% respectively.
Closing of agricultural markets requires maximum responsibility of stores
The closing of markets selling fruit and vegetables in a move to prevent the spread of the COVID-19 infection requires maximum responsibility of stores. An analysis published on the platform EastFruit, which presents information about the fruit and vegetable markets eastwards the EU, says the main problem of supermarkets in Moldova is not the prices that are higher than at the market, but the relatively low quality of products. The elder is the buyer, the more often this makes purchases at the market, shows an opinion poll presented by the analysis authors. Approximately 86% of the buyers aged over 56 buy fresh fruit and vegetables only from open areas where these are retailed.
Many business entities cannot pay rent and fulfill other contractual obligations, MP
PPPDA MP Alexandru Slusari, Deputy Parliament Speaker, called on the Government to swiftly propose a bill to amend the Law on the Chamber of Commerce and Industry so that this is examined as a matter of urgency. Alexandru Slusari noted that given the situation created in connection with the declaring of a state of emergency, many business entities cannot pay rent and cannot fulfill other contractual obligations, while the private individuals encounter problems in the payment of interest on loans. “After a state of emergency was declared, force majeure circumstances appeared,” the MP posted on Facebook.
NBM explains in what cases bank card holders are charged commission
The holders of bank cards are charged commission only when a monetary conversion is performed when paying with the card or, in some of the case, when withdrawing cash. In other cases, the payment beneficiaries do not have the right to levy commission on card holders for payments with the card, the National Bank of Moldova. Agency. According to the NBM, commissions that are not related to operations can be charged for issuing and maintaining a card. The charges levied by payment service providers are not capped by regulations, these being dictated by the market. The card holders are provided with information about all these charges in an accessible way and in strict compliance with the law.
Government announces measures in support of business sector
The Government in several days will approve a bill that contains measures that will be taken to support the business sector. A moratorium will be imposed on all the state inspections during the state of emergency. In this period, fiscal, financial inspections and inspections to determine the quality of products/services, technological parameters and/or specific requirements for the performed activity and inspections to see if the labor protection norms are respected will not be carried out. It is also proposed annulling the obligation to perform a mandatory audit of the individual financial situations for 2019 for small and medium-sized enterprises.
IMF: Moldova’s economic growth remained solid
Moldova’s economic growth remained solid in the first three quarters of 2019, with output expanding nearly 5 percent, supported by strong domestic demand. External demand remained favorable but net trade continued to be a drag on growth, says a press release issued by the IMF Permanent Representative Office in Moldova that is quoted by IPN. The Executive Board of the IMF concluded the Article IV consultation with the Republic of Moldova on March 11, 2020. The Board also completed the sixth and final review of Moldova’s economic performance under the Extended Credit Facility (ECF) and Extended Fund Facility (EFF) arrangements. According to the IMF, unemployment remained low by historical standards, at around 4 percent. Inflation breached the upper bound of the band around the National Bank of Moldova (NBM)’s target in late 2019, reaching 7.5 percent, largely driven by food prices and a turnaround in regulated prices—as the effect of previous tariff cuts dissipated—and by the impact of robust aggregate demand on core inflation. The fiscal deficit significantly overperformed the program target, despite widening to 1.5 percent of GDP in 2019.
A number of commercial activities will be resumed next week
A series of commercial activities could be resumed as of March 23. It comes to separate retail outlets that sell hygiene products, fodder, seeds and spare parts for units of transport. Such a decision was taken after the March 18 meeting of the National Extraordinary Commission for Public Health. In a press briefing, Prime Minister Ion Chicu said that it was decided to allow the retail outlets selling only hygiene products to reopen on March 23. The agricultural shops selling seeds, phytosanitay products, fodder and other products needed in the technological and operational processes of farmers, agro-industrial companies and others will also resume work.
Driving tests suspended
The Public Services Agency in the immediate period will provide a limited number of services. Also, the driving tests were suspended. After the March 18 meeting of the National Extraordinary Commission for Public Health, Prime Minister Ion Chicu said the Agency will provide services for business entities, will issue particular cadastral documents, death certificates and others, but based on appointment scheduling. The state-owned enterprise “Moldova’s Post Office” will also provide a reduced number of services.
● FRIDAY, March 20
Fuel pries lowered again
Filling stations posted lower fuel prices in the morning of March 20. Diesel fuel and gasoline are by 0.60 lei and, respectively, 0.60 lei on average cheaper, while d liquefied petroleum gas by about 0.20 lei. The price of a liter of gasoline of 95 type is 16.72 lei, as against 17.42 lei a day ago. Diesel fuel costs 14.72 lei a liter, as opposed to 15.32 lei, while liquefied petroleum gas is sold for 9.97 lei a liter, in contrast to 10.15 lei earlier. Over a week ago, fuel prices were decreased by 0.30-0.40 lei/liter
Revenues from trolleybus passenger transportation services down over 50%
The revenues of the Chisinau Electric Transport Company decreased by over 50%, but the company’s director assures that the salaries of employees will not be cut. Dorin Chernyi said that in this difficult situation for everyone, they do not bank on revenues as the company provides social transport first of all. The company’s director said the financial difference is compensated with funds from the municipal budget and there is a methodology for calculating these compensations. The employees will not be affected and the salaries will be paid on time
Employers and state should share financial burden in supporting employees, PPPDA
MPs of the Party “Dignity and Truth Platform” (PPPDA) registered a package of laws, noting that these are designed to solve the problem of closure of enterprises amid the epidemiological crisis and the temporary layoffs. In a posting on Facebook, PPPDA vice president Alexandru Slusari, Deputy Parliament Speaker, said the proposed bills enable the employers and the state, in a situation of epidemiological crisis when the enterprises stop work, to share the financial burden in supporting the employees. The employer would pay one third, while the social budget 50% of the salaries of persons made redundant.
Airline faces penalties for violating imposed restrictions
The airline Fly One risks being penalized for not respecting the epidemic disease prophylaxis, prevention and combating measures. It faces a fine of 50,000 lei. On March 18, the company operated a Sharm-El-Sheikh-Chisinau charter flight to bring home Moldovans who were vacationing in Egypt. Contrary to the decision of the National Extraordinary Commission for Public Health, two Ukrainians were allowed to go aboard. Inspectorate. Inbound and outbound air traffic through the Chisinau International Airport was closed on March 17. Only private/charter flights are allowed so that the authorities of Moldova and other states could evacuate their citizens from areas affected by COVID-19
Special work program adopted for institutions managed by Government
As of next week, the employees of the central public administration, such as those of ministries and other institutions managed by the Government, will work according to a special program: from 7:30am until 4pm, with the lunch break between 12 noon and 12:30pm. A decision to this effect was taken by the Commission for Exceptional Situations on March 20. “The purpose of such a decision is to fluidize traffic, especially the flow of passengers in public transport. This way, the public sector employees will use public transport before the rush hour,” Prime Minister Ion Chicu stated in a press briefing
NBM adjusts monetary policy instruments
The Executive Board of the National Bank of Moldova (NBM) unanimously decided to decrease the base rate applied to the main short-term monetary policy operations by 1.25 percentage points, to 3.25 percent annually. Also, the interest rates on overnight loans and deposits were decreased to 6.25 percent and, respectively, to 0.25 percent annually. The required reserves ratio in Moldovan lei and non-convertible currencies was cut by 2.5 percentage points, while the required reserves ratio in freely convertible currencies was increased by 1.0 percentage points.
