ECO-BUS WEEKLY DIGEST March 23-29. Most important Economy & Business news by IPN
● MONDAY, March 23
Power bills will be compiled based on estimative data
The commercial offices of Premier Energy will remain closed until March 27 so as to avoid the spread of the COVID-19 infection. By the end of this month, the electricity supplier will issue the electric power bills compiled based on estimative data. Given authorities’ recommendations, the company decided that the electricity meters will not be read until March 31. Such a measure is temporary.
PPPDA demands to cap profit margin on some of vegetables
MPs of the Party “Dignity and Truth Platform” (PPPDA) says the profit margin on the vegetables used to make borsch, which are popular with pensioners, should be capped during the state of emergency. A request to this effect was made to the Government and the Commission for Exceptional Situations. “We ask to consider raising the prices of vegetables of the set intended to make soups, borsches, etc., such as potatoes, beefs, carrots, onions and cabbage, within the Commission for Exceptional Situations and to take measures to cap the profit margin on these products to 15%,” says the request signed by the chairman of the PPPDA parliamentary group Alexandru Slusari, noting there is usually a shortage of such products in March-May.
Cold cuts producers ask authorities to cap meat prices
Following intentions to raise meat prices announced by national producers, the cold cuts company Rogob sent a letter to the Government and the competent ministries whereby this asks to cap the meat prices during the state of emergency. In a press release, the company says that it was notified by national meat producers of the intention to raise meat prices by 29.86%. Rogob director Igor Roșca noted the prices of essential products that form part of the minimum monthly consumer basket, such as meat, should be capped during the state of emergency so as not to allow a sudden and substantial rise in prices.
Vlad Filat: US$100m from IMF is an opportunity that should be accessed swiftly
Ex-Premier Vlad Filat said the Republic of Moldova, like other countries, needs to use all the resources, including the foreign loans, so as to strengthen the healthcare system and to identify solutions to support the economy, in particular the small and medium-sized enterprises. According to the ex-Premier, the IMF’s readiness to offer Moldova US$ 100 million to cope with the COVID-19 pandemic and to support the private sector is an opportunity that should be accessed as swiftly as possible. The delay in raising this loan cannot be justified and the people will only suffer as a result.
MEPs give support to ECIPES program
Eleven MEPs already expressed their support for 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. The program envisions the implementation of a project similar to Romania’s “Home Appliances in Exchange for Scrap” and provision of assistance to young people and mayor’s offices from the European funds allocated to Moldova (2021-2022) through the European Neighborhood Instrument. The ECIPES program will provide support to people aged between 18 and 35 to start businesses: €5 million for businesses in the service sector and €15,000 for business in the manufacturing sector, €12,000 of which for purchasing tools and equipment.
● TUESDAY, March 24
Bills for public utilities could be issued in stages
The bills for public utilities will most probably be issued in stages in the course of April. A discussion on the issue will be held today with public service providers, said Prime Minister Ion Chicu. According to him, the measure is needed to avoid the formation of crowds at post offices and banks amid the COVID-19 pandemic. “We will have a meeting, a discussion with the main providers of such services so as to agree a timetable for issuing these bills in a move to avoid the formation of crowds at offices where the bills can be paid,” Premier Chicu stated after the March 23 meeting of the Commission for Exceptional Situations.
Company transfers 1m lei to health facilities of Moldova
The holding “Transoil” transferred 1 million lei to the special account opened by the Ministry of Health, Labor and Social Protection in support of health facilities and doctors who deal with the COVID-19 pandemic, IPN reports, quoting a press release of the company. The holding’s owner Vaja Jhashi said forces in this hard period of time should be combined. “Each of us should make their own contribution, but we should first of all support the doctors who are in the front line, risk their health, make huge effort to treat the infected people so as not to allow the virus to emerge victorious in the struggle for life,” stated Vaja Jhashi.
Exceptional state should be declared in the economy, PPPDA
The Government should declare an exceptional state in the economy and should urgently work out a package of measures to prevent the private sector from reaching a general state of insolvency, massive layoffs and dramatic bankruptcies, suggested the Party “Dignity and Truth Platform (PPPDA), which called on the executive to responsibly ask for assistance amid the crisis situation from the international partners. “We consider that the Parliament of the Republic of Moldova is obliged to urgently adopt significant rectifications to the 2020 state budget law, cancelling less important costs, but financing only the basic needs in the public sector, such as the payment of salaries and pensions, and authorizing instead sufficient budget resources for increasing the pays of medical personnel, for implementing policies to compensate the citizens and businesses for the sustained losses,” says a statement signed by the PPPDA.
● WEDNESDAY, March 25
Doctors dealing with persons infected with COVID-19 will get higher pays
The doctors from all over the country will receive their salaries fully and on time. Moreover, the doctors who struggle against COVID-19 in the front line will get considerable bonuses to salaries, Deputy Prime Minister Sergiu Pușcuța, Minister of Finance, stated in the talk show “Moldova live” on the public TV channel Moldova 1. “All those who are directly involved in the fight against this disease will receive appropriate salaries. This is a small part of our gratitude to the healthcare workers. With all this appreciation, the efforts made by them should be rewarded financially. This reward will be introduced when the state budget is amended,” said Sergiu Pușcuța.
Decision regarding potential renewable energy producers sent for publication
The National Agency for Energy Regulation sent the decision concerning the approval of fixed charges and ceiling prices for electric power generated from renewable sources of energy by producers that will obtain the status of eligible producer in 2020 for publication in the Official Gazette. The Agency’s Administration Board in February approved price rates and fixed charges for electric power generated from renewable sources of energy, as follows: photovoltaic installations – 1.88 lei/kWh, Aeolian installations – 1.55 lei/kWh, hydropower installations – 0.97 lei/kWh, biogas cogeneration installations – 1.84 lei/kWh and solid biomass cogeneration installations – 1.96 lei/kWh.
Moldova borrows money from Japan for modernizing agricultural machinery
The Government approved the negotiation and signing of the lending agreement between the Republic of Moldova and the Japan International Cooperation Agency for implementing the Modernization of Agricultural Machines and Equipment Project. Based on this agreement, Japan will offer Moldova a preferential loan of 2 059 000 000 yen (US$ 18.6m). The document is to be signed by Moldova’s Ambassador to Japan Vasile Bumacov. The loan is repayable in 40 years with a grace period of 12 years, an interest rate of 0.1% on the purchase of machinery and a rate of 0.01% on consultancy services provided within the project.
Executive authorizes purchases totaling 36m lei without tender contests
The Government approved the allocation of 36 million lei from the state budget for buying 200,000 protection screens and 500,000 respirators. The purchases will be made without holding tender contests. The Center for Centralized Public Procurement in Healthcare will apply the negotiation procedure without preliminarily publishing a participation notice, given the order made by the Commission for Exceptional Situations. According to Prime Minister Ion Chicu, when the state budget is amended, the Ministry of Finance will propose supplementing the Reserve Fund and the Intervention Fund by over 100 million lei. The money will be used to satisfy similar needs.
● THURSDAY, March 26
Medical crisis will generate economic and humanitarian crises, opinion
The Moldovans are a very mobile nation with almost 1 million citizens abroad. Migration is a channel for propagating the socioeconomic and, evidently, medical impact of the crisis. Many of the migrants tried and continue to try to return home, exposing themselves and their families, relatives and even communities to the risk of further propagating the virus. An extraordinary effect of propagation of the negative consequences generated by the medical-economic and humanitarian crises already exists. The opinions were stated by the programs coordinator of the International Organization for Migration Office in Moldova Gennady Crețu in a debate staged by the Institute for European Policies and Reforms. Gennady Crețu said there are about 300,000-350,000 Moldovans in a more difficult situation who work on a short term abroad. They work based on biometric passports or without any contract or work permit. The most vulnerable ones represent yet 20-22%, which is 60,000-70,000 persons. These are exposed to the risk of immediately losing the jobs, the sources of existence and even the homes. These persons do housework in Italy and other states.
Many enterprises operating in different industries risk going bankrupt, debates
Currently, a lot of enterprises working in different industries are in a crisis situation and many of them will not resist and will go bankrupt. Among these are restaurants, hotels, educational centers, beauty salons and other types of services. These entrepreneurs have to cope with failed revenues. Some of them have to close. Even so, at the end of the month they must pay salaries, taxes, rent and honor their obligations to suppliers. The opinions were stated in a debate organized by the Institute for European Policies and Reforms. Executive director of the Alliance of Small and Medium-Sized Enterprises of Moldova Liliana Busuioc said that in the current situation generated by the COVID-19 pandemic, companies operating in different industries are exposed to huge risks and the SMEs are the most vulnerable ones. They account for about 98% of the economy. The association represents 47 companies working in eight industries, but until now they had a dialogue on the faced challenges and on eventual solutions with a much larger number of enterprises.
State institutions invited to submit proposals for reducing budget costs
The state institutions are expected to formulate proposals for cutting back on spending so that the available sums could be used to weather the crisis caused by the COVID-19 pandemic in Moldova. In a posting in on a social networking site, President Igor Dodon said the presidential institution already finalized the first plan for reducing costs by over 4 million lei. These costs are associated with purchases that are not absolutely necessary, with trips and bonuses intended for the personal and other purposes.
● FRIDAY, March 27
Political parties could donate financial allocations for weathering COVID-19
The political parties will be able to donate the state budget allocations intended for parties for containing the COVID-19 pandemic. Currently, the law bans this. The decision was taken in the March 26 meeting of the Commission for Exceptional Situations. According to Prime Minister Ion Chicu, to offer the parties the possibility of donating the financial allocations intended for parties for weathering the novel coronavirus, derogation was allowed from the Law on Political Parties. Now the parties could make these donations.
Igor Munteanu: We will go over 2020 budget with bulldozer
“Inflation will rise and I hope it will rise not so much as to be slaying for the small incomes of the population. The swifter the Government intervenes with a package of anti-crisis measures intended for the SMEs, the lesser will be the human sacrifices,” MP Igor Munteanu was quoted by IPN as saying in the talk show “In Depth” on PRO TV channel. According to the MP, the currency market of Moldova will also be affected and the leu is expected to depreciate. “We must expect important changes on the currency exchange market and this will be due to the remittances that will decline and to the currency interventions as the National Bank of Moldova will assume an active role. The NBM will have to offer more possibilities to the commercial banks and to intervene in the currency market and this will have an impact on the leu-dolar exchange rate,” stated Igor Munteanu. The MP noted the authorities should rapidly draw conclusions and the 2020 state budget will undergo considerable changes.
Public sector employees will not work next week
The employees of the public sector, except for healthcare workers, will not go to work next week, as of March 30, as the Commission for Exceptional Situations decided on March 26. The measure does not apply to the public sector employees. According to Prime Minister Ion Chicu, it was decided that the period between March 30 and April 03 will be nonworking for all the public sector units, except for health facilities whose employees provide auxiliary services for the public heath institutions and for the rescue and emergency assistance services. The administrative authorities of the national defense, pubic order and security sectors will also make an exception. The public sector employees will work for these days after the state of emergency is lifted.
IMF likely to provide US$117m to Moldova to mitigate economic impact of COVID-19
The International Monetary Fund could offer Moldova USD 117 million in response to the authorities request for IMF emergency financing assistance to mitigate the economic impact of COVID-19. The IMF mission, led by Ruben Atoyan, will hold discussions from the IMF Headquarters in Washington, D.C. during March 30 – April 1 on economic policies appropriate for addressing the impact of the pandemic under the blend RCF/RFI. A press statement of the IMF Resident Representative in Moldova Volodymyr Tulin says that financing under the RCF/RFI is subject to Executive Board approval and does not involve ex post conditionality or reviews. In case of Moldova, the blend RCF/RFI can support an outright disbursement of up to SDR 86.25 million (equivalent to USD 117 million, or 50 percent of quota), paid out in an expedient manner.
Banks to enjoy flexibility in approaching economic agents about loans
The Executive Board of the National Bank of Moldova (NBM) approved a decision that allows licensed banks to postpone or change the payment deadlines and/or the amounts of due payments on loans granted to economic agents until June 30, 2020, IPM reports, quoting a press release of the Bank. The change in the aforementioned deadlines will not have the effect of automatic classification of these loans into a tougher category than the existing one, as of the date of adoption of this decision. The decision refers to the legal entities whose financial situation is temporarily affected due to the state of emergency and the economic consequences generated by COVID-19.
Civil Aviation Authority notifies police over “Avia Invest”
The Civil Aviation Authority notified the police after the concessionaire of the Chisinau International Airport, “Avia Invest” SRL, refused to provide the cost basis for airport charges, IPN reports, quoting a press release of the Authority. The Civil Aviation Authority, which is empowered to check the correctness of the formation of charges for airport and air navigation services, on February 12 asked “Avia Invest” to present the cost basis for airport charges for 2020. In a response provided in written form on March 17, the company says that it refuses to furnish the requested data. The refusal prevents the Authority from fulfilling its duties as a civil aviation inspection body.
● SATURDAY, March 28
Only 24% of water pumping stations are functional
Of the total number of irrigation water pumping stations, only 24% are functional. Another 30% are in an unsatisfactory state and cannot be used now, whole 46% are semi-destroyed or fully destroyed. To accelerate the solving of problems related to hydro-amelioration, the State Chancellery proposed a draft decision that contains a plan of action for 2020-2023. The informative note to the bill says the irrigation infrastructure networks that in the past ensured the irrigation of over 200,000 hectares of farmland is now only about 30% (40,000 ha) functional. Specialists consider the situation can worsen as most of the irrigation systems are in a disastrous state.
● SUNDAY, March 29
Over 19m lei to be allocated for purchasing ventilators
The Ministry of Finance will allocate 19.5 million lei from the Government’s intervention fund to the Ministry of Health, Labor and Social Protection for buying ventilators for persons infected with the novel coronavirus. The ventilation equipment will be acquired through the agency of the Center for Centralized Public Procurement in Health. Under the decision of the Commission for Exceptional Situations, by derogation from the law on public procurement, the Ministry of Home Affairs will be able to purchase antiseptics and personal protective equipment by negotiation, without preliminarily publishing a notice of participation. The acquisitions to the value of at most 1 million lei are also needed to prevent and combat infection with COVID-19.
Days declared nonworking will be calculated as working days
The period between March 30 and April 03 that was declared nonworking for public sector employees will be considered working days and will be included as such in the salaries for March and April, as the Commission for Exceptional Situations decided on March 38. The Commission also decided that the provision of one-time rewards during the state of emergency will be suspended. The decision specifies that the period will not be considered nonworking for those who ask to go on leave or are on annual live and receive leave benefit or are on unpaid leave.
