ECO-BUS WEEKLY DIGEST July 6-12. Most important Economy & Business news by IPN

● TUESDAY, July 7

Termoelectrica diversifies used sources of energy

Termoelectrica plans to diversify the used sources of energy by producing heat from biomass. The team is considering solutions by which to increase the consumers’ comfort and to contribute to providing sustainable and eco-friendly heating services, IPN reports, quoting a press release of the company. Termoelectrica plans to launch a project to produce heat from biomass at its suburban thermal power stations. The new ecological technologies that are to be applied during the next few years will enable to supply a large number of consumers with head, namely 5,500 apartments, 110 houses, 40 enterprises, 12 public kindergartens, 25 education institutions and eight health facilities. The given initiative became the winner of a contest of innovation and technology transfer projects organized by the National Agency for Research and Development and is to be equally co-financed by Termoelectrica and with state budget funds.

● WEDNESDAY, July 8

Foreign exchange reserves of NBM higher in June

The official foreign exchange reserves at the end of June totaled US$3.193,55 billion, an increase of US$57.33 million compared with the end of May, when they came to US$3.136,22 billion, IPN reports, quoting the National Bank of Moldova. According to the NBM, the rise in the official foreign exchange reserves stemmed from the purchases of currency from the domestic currency market totaling US$37 million, appreciation of the exchange rates of the currencies that form part of the foreign exchange reserves against the U.S. dollar in the amount of US$ 19.71 million and registration of loans and grants of US$14.19 million in favor of the Ministry of Finance of Moldova for investment projects.

Call to responsible bodies and PGO over alleged illegalities against “Central House” SRL

The founder and ex-manager of “Central House” SRL Vitalie Perciun calls on the Prosecutor General’s Office (PGO) and all the responsible bodies to become involved given the illegalities and abuses committed against the Company. According to him, the Company, which in 2014 signed a lease contract with the state-owned enterprise “Gările și Stațiile Auto” (“Motor Terminals and Stations”, was forced to pay rental as if for areas even if it actually rents land. As a result, the rental is distortedly high. Moreover, the founder said that criminal cases were started unfoundedly and the taken measures blocked the Company’s activity. In a press release, Vitalie Perciun says that under the contract that is valid for 49 years, the property was leased out with the aim of attracting investments for modernizing and renovating the adjoining territory, by erecting buildings, reconstructing platforms and repairing sidewalks so as to implement the European standards in the process of serving passengers. In 2014-2015, “Central House” SRL carried out works based on the contract, sustaining costs of 28 738 643.77 lei.

Drought and frosts affected 60-80% of winter crop fields in central and southern Moldova

An average wheat harvest of about 2 tonnes per hectare is expected this year. According to the Ministry of Agriculture, about 400,000 hectares were sowed with winter crops in the 2019-2020 season, but the drought and this spring’s frosts affected about 215,000 hectares: 25% in the northern districts and 60-80% in the central and southern districts, IPN reports, quoting a press release of the Ministry. Minister of Agriculture, Regional Development and Environment Ion Perju made a working visit to Sângerei and Florești districts to see how the grains of the first group are being harvested. Farmers in Rădoaia village of Sângerei district told him that the impact of the hydrological drought can be seen in each field and they project that the harvest will be twice lower than last year. However, they hope to get an average quantity of 4 tonnes of wheat per ha and of about 2 tonnes of barley per ha.

Government initiates negotiations on provision of new EU macro-financial assistance

The Government approved a draft decision concerning the initiation of negotiations and approval of the signing of a lending agreement with the European Union on macro-financial assistance for Moldova. It goes to a loan of at most €100 million that will be disbursed in two equal tranches. Deputy Prime Minister Sergey Pușcuța, Minister of Finance, said the disbursement of the first tranche is conditional upon the signing of the memorandum of understanding. The second tranche will depend on the progress made in implementing the memorandum and in fulfilling six conditions, some of which formed part of the conditions for the third tranche of the current macro-financial assistance program that expires in summer. The minister said the loan will be repayable in at most 12 months. The interest rate on each tranche will depend on the costs incurred by the European Commission to borrow money from the international financial market.

Public procurement procedures related to containing of COVID-19 more flexible

A special regulation approved by the Government sets down flexibility mechanisms in the procurement of goods, services and works for the prevention and control of COVID-19. The regulation provides that in emergencies, the periods of the open and restrained tendering procedures can be reduced. If this mechanism is not sufficient, the negotiation procedure will be applied without publishing the tender contest announcement - details about the goods that are to be purchased and other information made public in case of public procurement. It will also be possible to increase the ceilings – quantities of medicines, number of objects needed for preventing and controlling COVID-19. In the same meeting, the Government extended the ban on the export of medical face masks until July 31.

Open letter concerning building of helicopters addressed to President

Iurii Ceban, who signs as a plane builder and as the leader of the group of enthusiasts of the hangar situated in Criuleni district, addressed an open letter to President Igor Dodon. In this, Ceban says he is ready to become involved in the development of the national helicopter industry and expresses his hope that the law enforcement agencies will clarify the circumstances of this case, including as regards the fact that there were not helicopters, as it was announced, but models in the hangar. “I’m grateful to President Igor Dodon for the attention devoted to this subject. I hope that by such an attitude, our law enforcement agencies will have sufficient professionalism, knowledge and experience to understand this situation inspired by someone and for something. It should be clear that our large-scale models that look like helicopters from a distance are far from being flying machine able to fly and suitable for use,” Iurii Ceban says in his letter.

● THURSDAY, July 9

Highest poverty rate is witnessed in households with three children and more

The households consisting of five and more persons face a poverty risk that is 2.2 times higher than in the case of households consisting of one person, show recent data published by the National Bureau of Statistics. The lowest poverty rate (10.2% in 2018) is recorded in the case of households formed of one member younger than 60, while the highest one (42.0%) in the case of households with three children and more. This group of households represents about 8% of the population. The place of residence is an important factor in determining the population’s welfare. According to statistics, the rural population is exposed to a bigger poverty risk than the urban population. The poverty rate in rural areas in 2018 was 31.6%, as opposed to 10.6% in urban areas. A slight decrease was witnessed in rural and urban areas compared with 2017.

● FRIDAY, July 10

Approaches made to terminate contract with investor of Chisinau Airport

The Public Property Agency made an official request to the investor of the Chisinau International Airport over the termination of the contract. The state’s position remained the same – the airport should be returned to the exclusive ownership of the state. There are legal conditions for terminating the contract because the investor didn’t fulfill the contractual obligations, said President Igor Dodon, being quoted by IPN. “The same is true about AirMoldova. The situation there is even more serious. It is an enterprise that has rather large debts. We regret that AirMoldova is in the situation in which it is. So far it has operated all the planned flights. I hope a lot it will survive. But the airport should be returned to the state. AirMoldova probably too, at a certain stage. We must first clarify the situation with the debts,” Igor Dodon stated in the program “President Responds”. The operations and management of the Chisinau International Airport were transferred to Avia Invest in November 2013 under a public-private partnership contract valid for 49 years. The concessionaire pledged to invest €250 million in the modernization of the airport.

EU approves €30m disbursement in MFA to Moldova

The European Commission, on behalf of the EU, has today approved the disbursement of €30 million in macro-financial assistance (MFA) to the Republic of Moldova. This is the second and final disbursement under Moldova’s current MFA program following the first installment of €30 million in October 2019. It is composed of €10 million in grants and €20 million in low-interest, long-term loans, IPN reports, quoting a press release. The program is designed to assist Moldova in covering its external financing needs, which is especially important in light of the coronavirus pandemic, while implementing a wide-ranging and ambitious reform agenda. “The European Union stands by the Moldovan people in these difficult times. I also want to commend Moldova for the reform efforts being pursued, for instance in improving the justice system and fighting corruption,” said Paolo Gentiloni, Commissioner for the Economy.

Electric power could be cheapened

Premier Energy presented its request to approve regulated prices for the supply of electricity for 2020 to the National Agency for Energy Regulation. The supplier said the prices are lower for all the voltage levels, including for household users, for whom the prices are by 5.7% or 10.76 bani lower than at present. In a press release, the company said the calculations were based on a number of factors, namely the purchase price of power stipulated in the current contracts for 2020 and the current power transport and distribution tariffs, the distribution tariffs asked on March 11 this year by the distribution operator, the main costs related to the electricity supply, the volumes of supplied power, the macroeconomic indicators specified in the informative note to the bill to amend the 2020 state budget law.

PPA asks Avia Invest to transfer back assets of Chisinau Airport

Owing to the non-fulfillment of the contractual obligations, the Public Property Agency (PPA) on July 8 ended the contract for the concession of assets managed by the state-owned enterprise Chisinau International Airport and the adjoining area signed with SRL “Avia Invest”. The PPA requested “Avia Invest” to transfer back the Airport’s assets. In a press release, the PPA says that on August 30, 2013 it signed a contract for the concession of the assets managed by the state-owned enterprise Chisinau International Airport and the adjoining area with SRL “Avia Invest”. Under the contract, the concessionaire will guarantee the financing of the concession throughout the period of validity of the contract in the set volume and by the set time limits, by providing the guarantee of execution of the contract at each stage.

Avia Invest: Concession contract is not and cannot be terminated

“Avia Invest”, which is the concessionaire of the Chisinau International Airport, denies the reports concerning the termination of the concession contract. The company said it was only notified by the Public Property Agency of the intention to end the contract due to the non-presentation of the insurance policy. “Avia Invest” says the Agency’s actions are a new attempt to fulfill the personal orders of Dodon to terminate the contract at any cost. “The assertions are untrue and brazen. The procedure for the termination of the contract is long and “Avia Invest” denies the information and notes that it does not consider a notification an accomplished act. Moreover, “Avia Invest” is concerned about the amplification of the attacks on the company. These are orchestrated by Igor Dodon, who showed that he will not stop in front of any illegality as he aims to take over this facility in which huge investments were made in modernization,” the company says in a press release.

● SATURDAY, July 11

Ion Chicu about “Avia Invest”: We consider it didn’t fulfill obligations

The Public Property Agency has issued a notification to SRL “Avia Invest”, which is the concessionaire of the Chisinau International Airport, concerning the contract for the concession of the airport, as Avia Invest didn’t fulfill the contractual obligations, Prime Minister Ion Chicu stated in a news conference on July 10. Premier Chicu said “Avia Invest” didn’t honor the obligation to erect concession facilities neither at the first investment stage nor at the second stage and didn’t provide the guarantee of execution of the contract to the value of €1 million. SRL “Avia Invest” has 180 days to decide the next steps.