ECO-BUS WEEKLY DIGEST 10-August 16. Most important Economy & Business news by IPN

● MONDAY, August 10

Authorities to take out emergency loan for agriculture from World Bank

The Moldovan authorities intend to raise an emergency loan from the World Bank to support the drought-stricken agricultural sector, President Igor Dodon announced after the August 10 meeting of senior state officials. He didn’t specify the sum yet. President Dodon said the witnessed drought is unprecedented and the farmers probably face the most difficult situation since the declaring of Independence. According to him, the Government started to provide compensations to farmers and 200 million lei has been identified for the purpose. But assessments covering the second group gain crops continue to be carried out. Sources will be identified for the purpose, but the budget capacities are limited. “We discussed with colleagues from the Government and decided to ask for an emergency loan from the World Bank so as to help particularly the farmers. There are such mechanisms. The colleagues from the Government during the next few days will have the first contacts with WB representatives to discuss this subject,” stated President Dodon.

Authorizations for transporting freight to Russia are used up

The authorizations for carrying freight from Moldova to Russia via Ukraine will be used up during the next few days. In such conditions, a part of the authorizations for the fourth quarter will be distributed now so that the carriers could export goods to the Russian market. President Igor Dodon said such an agreement was reached during his recent visit to Moscow. “Trade in agrifood products in the first five months of this year rose by 20%. This is primarily due to the concessions offered to us by the Russian Federation. I refer to the duty-free export of the main agrifood products, as we agreed with the President of the Russian Federation several years ago. This decision has a positive effect on the farmers of the Republic of Moldova, who, as I said earlier, annually save 200-300 million lei by not paying duties when entering the Russian Federation,” Igor Dodon stated after the meeting of senior state officials.

Moldovan lei reached highest level so far this year, expert

The Moldovan leu continues to appreciate against the currencies of the Moldova Currency Index-10 (IVM-10) for the third month in a row. Last week, this reached a new high of 95.75 points, which is by 4.25% higher than at the start of the year, economic expert of the Institute for Development and Social Initiatives “Viitorul” Veaceslav Ioniță says in an analysis. The expert noted that the Moldovan leu during August 3-9 appreciated by 0.75% against all the currencies of the main trading partners from the IVM-10. The leu last week appreciated by 3.33% against the Turkish lira, by 2.16% against the Russian ruble and by 1.84% against the Belarusian ruble. Veaceslav Ioniță said that the Moldovan leu since the start of this year appreciated by 4.25% on average against the ten currencies of the IVM-10. It appreciated against eight currencies and depreciated against two currencies. The Moldovan lei appreciated the most against the Turkish lire (+18.80%), Russian ruble (+18.57%) and Ukrainian hrivna (+16.82%) and depreciated against the euro (-2.21%) and Romanian leu (-0.89%). “In general, the Moldovan leu in 2020, in relation to the main currencies – US dollar and euro – copies the behavior of the Romanian lei,” said the expert.

Call for project proposals with financing from National Regional Development Fund

A new call for project proposals with financing from the National Regional Development Fund was launched on August 10. This is intended for local public authorities and other entities, such as ministries or agencies, NGOs and the private sector. The cost of projects oscillates between 5 and 50 million lei. The total budget allocated for this call is 660 million lei. Within the economic competiveness program, the top financing areas include the development of business infrastructure, building of public utilities and attraction of investments. The local public authorities will have to ensure co-financing in the amount of 10%. The minimum cost of projects is 5 million lei, while the maximum one is 25 million lei. The other financed areas are: development of entrepreneurial environment, enhancement of tourist attractions, urban development, such as laying out of recreation areas, public places and renovation of public institutions and quarters, regional infrastructure to build water supply and sewerage networks and to rehabilitate the existing infrastructure.

Farmers announce protests in a number of districts

The farmers from the central and southeastern districts, who were affected by drought and hail, express their dissatisfaction with the measures taken by the Government. They intend to mount protests in a number of districts of the country on August 11 in connection with the disastrous situation in agriculture. Andrei Dînga, farmer from Ștefan Vodă, said the farmers from about 14 districts will come together in six places, including national roads. If their demands are not satisfied, the protest will be extended to Chisinau. In a note addressed to the Government and the Ministry of Agriculture, the farmers ask to take measures to stabilize the macroeconomic situation in the agricultural sector. “The farmers in central and southeastern Moldova already used up all the possibilities of identifying financing resources for paying taxes into the budget, paying salaries to employees, accumulating salary arrears for several months, paying the rising debts, purchasing parts, diesel fuel, phytosanitary products and seeds for entering the new agricultural year in the hope that it will be better,” says the agricultural producers’ call. They ask that the financial resources allocated for compensating the farmers for their financial losses should be of at least 3,000 lei per hectare.

● TUESDAY, August 11

CMC dismisses Autosalubritate head

Eugeniu Axentev was discharged from the post of head of the cleanup company Autosalubritate by the votes of 24 municipal councilors as a result of managerial irregularities identified at the company. Eugeniu Axentev considers the decision is unsubstantiated. “I didn’t familiarize myself with the report and the conclusions of this report. I wasn’t invited to the Council to provide explanations as I have the right to defend my dignity,” Eugeniu Axentev stated. The signing of the individual work contract in this case is the prerogative of the mayor general, but this insisted that a decision should be taken by the Chisinau Municipal Council (CMC). In the Council’s meeting, mayor general Ion Ceban said the head of Autosalubritate last year collected 700,000 lei in salaries, which is a monthly salary of 62,000-64,000 lei. Irregularities were also identified in relation to employees, the vehicle wash service, documents showing car parts were replaced. Also, employees who are building the levee in Țânțăreni also did works in Eugeniu Axentiev’s apartment. Eugeniu Axentiev said the annual salary of 700,000 lei is not a crime. This is set by law and a similar salary was collected by his predecessor. He considers he was suspended illegally. “They named Dumitru Vulpe to work at the company on the direct instruction of the mayor general,” he stated, noting it’s not true that employees worked in his apartment.

Largest income earned by person in 2019 was 324m lei

The State Tax Service last year received 101,500 tax returns submitted by persons who perform entrepreneurial activities. The total sum of the income tax calculated and paid in 2019 was 4.18 billion lei, an increase of 8.2 billion lei or 24% on a year before. According to the data presented by business entities, in 2019 these earned 427.3 billion lei and spent 394.7 billion lei. Compared with the previous year, their revenues grew by 34.5 billion lei (+8.78%), while their costs increased by 31.3 billion lei (+ 8.61%). In the case of private individuals, the incomes earned by 1.22 million persons last year totaled 69.43 billion lei, while the income taxes came to 4.67 billion lei. The salaries are the citizens’ main source of income. They earned 53.87 billion lei salaries, an increase of 7.39 billion lei on 2018. The State Tax Service identified 2,515 persons who last year earned more than 1 million lei, as opposed to 1,760 persons in 2018. The incomes earned by these persons came to 9.028,99 billion lei, by 2.888,63 billion lei more than in 2018. The income taxes totaled 586.11 million lei, an increase of 106.4 million on 2018.

Assets of bank involved in banking fraud sequestrated

Assets totaling 1.9 billion lei of a commercial bank involved in the banking fraud were sequestrated with the aim of repairing the damage caused by laundering money in the interests of an organized criminal group and by abuse of power, the Prosecutor General’s Office has said. The assets could be eventually confiscated for the benefit of the state. These include 54 cars, 24 buildings and four special vehicles to the value of 58 million lei and 114 state securities worth 1.85 billion lei. In a press release, Victoriabank says it was surprised to learn about its inclusion in this case that concerns events that happened in Moldova’s banking system six years ago. “The bank is also surprised that information about the given situation is disseminated without it being informed about those events. Victoriabank, in its current form and after the transformation started in 2018, has no connection with the case investigated by the authorities. To prove this, Victoriabank cooperates with the authorities and is waiting for the next stages of the process,” runs the press release.

● WEDNESDAY, August 12

NBM welcomes Victoriabank’s readiness to cooperate with investigation bodies

In connection with the recent actions taken by investigation bodies, the National Bank of Moldova (NBM) welcomes the readiness of the administration of the commercial bank Victoriabank SA to cooperate with it. “BC Victoriabank SA is part of the broad reformation process that has taken place in the banking sector during the past few years, by which the activity in a number of strategic areas, such as transparency of share ownership, corporate governance, compliance with prudential norms, management of risks and others, were improved. This evolution is an important signal for internationally renowned investors, among which is Banca Transilvania SA. This fact is appreciated and supported by the development partners of the Republic of Moldova,” runs a press release issued by the central bank. According to the NBM, Victoriabank has witnessed positive modernization and international standards meeting dynamics. As the surveillance authority, the NBM monitors the situation in the banking sector of the Republic of Moldova. The Prosecutor General’s Office said 1.9bn lei assets of the commercial bank, which is featured in the case concerning the banking fraud, were sequestrated with the aim of repairing the damage caused by laundering money in the interests of an organized criminal group and by abuse of power. The assets could be eventually confiscated for the benefit of the state.

Special fund will be set up to support farmers

President Igor Dodon said a special fund in support of farmers will be created and the citizens could transfer money to this to support the agricultural sector affected by drought and hail. The decision was taken in the August 12 meeting of the Supreme Security Council. “We decided to set up a special fund, as in the case of COVID-19. All those who want from outside the country can provide support to the farmers of the Republic of Moldova, who were affected by drought. I’m firmly convinced that our foreign partners will also react and will offer assistance in this regard,” said President Dodon. He noted that Moldova has witnessed unprecedented drought this year. The first group grain crop fields were about 70% affected. The harvest of first group grain crops was projected at 600,000 tonnes, as opposed to the usual amount of 1.2-1.3 million tonnes. This year the harvest will represent 45-50% of the quantity gathered the previous years. There were harvested 440,000 tonnes of wheat, as to the 1 million tonnes obtained last year. “The country’s food security can be ensured with 360,000 tonnes. Despite the difficult situation this year, the food security is ensured,” noted Igor Dodon.

EBRD seriously concerned by indictment against Victoriabank

It is with serious concern that the European Bank for Reconstruction and Development (EBRD) has learned about the indictment issued by Moldova’s Anticorruption Prosecutor’s Office against Victoriabank and the recent court warrant authorizing the Anticorruption Prosecutor’s Office to seize assets of Victoriabank in connection with the investigation of fraudulent activities in the Moldovan banking sector in 2014. In a press release, the EBRD says that as a shareholder in Victoriabank it welcomes the bank’s cooperation with the Moldovan authorities in their investigation of activities which occurred before Banca Transilvania became a shareholder in January 2018 and the transparency of Victoriabank’s shareholding was restored. The EBRD trusts that the investigation will respect clients and customers of Victoriabank as well as its current shareholders, and be carried out in accordance with due process and due consideration of potential consequences for the Moldovan banking system. “As the largest institutional investor in Moldova, the EBRD regards a strong and stable banking sector a prerequisite of financial stability and as one of the pillars of sustained economic development and growth. Delivering on its mandate the EBRD has played an active role in the overhaul of Victoriabank since 2016 and remains a shareholder in the institution, which is now majority-controlled by Banca Transilvania and the EBRD,” runs the press release.

Iasi-Ungheni-Chisinau gas pipeline will be inaugurated on Independence Day

The Iasi-Ungheni-Chisinau is to be inaugurated on August 27, when it is celebrated the Independence Day of the Republic of Moldova, said Prime Minister Ion Chicu, noting that he  invited his Romanian counterpart Ludovic Orban to take part in the event. “As we all know, the National Day of the Republic of Moldova, the Independence Day, is celebrated on August 27. I want to tell you that we have an additional reason for joy as an energy infrastructure facility of the country was completed before this holiday. This will considerably strengthen the independence of our state. I refer to the Iasi-Ungheni-Chisinau gas pipeline,” Premier Chicu stated at the beginning of the Cabinet meeting. According to the official, this is a project whose main objective is to increase Moldova’s energy security. “On this occasion, I want to thank the Government of Romania, the people of Romania for the massive assistance provided to implement the project.”

Government opposes mandatory marking of production date on food products

The Cabinet didn’t endorse a legislative proposal for amending Article 8 of the law on the informing of consumers about food products submitted by a group of MPs. The proposal authors suggested making the marking of the food products with the production date, validity period or use-by date mandatory. Minister of Agriculture, Regional Development and Environment Ion Perju said the recent changes made to Article 8 provide for the mandatory labeling of food products with the shelf life, use-by date or the manufacture date and validity period. This way the consumer is offered the necessary information about the validity of the food products, obeying both the EU labeling standards and the national standards implemented by national food industry operators.

● THURSDAY, August 13

Air Moldova reacts to accusation that it does not fulfill obligations towards consumers

Air Moldova during six months has made the necessary effort to cope with this unprecedented crisis and equally struggles to avoid bankruptcy and to fully honor its obligations towards passengers. This is the company’s response to the accusation that it does not fulfill its obligations towards consumers made against it by MP Galina Sajin on August 12. “We want to note that the criticism was leveled by persons who are far from the civil aviation industry and probably do not realize the titanic effort that an airline must now make to survive. Air Moldova’s effort is even more significant as the governmental bodies, since the start of the pandemic, didn’t at least initiate a discussion on eventual state support for the civil aviation that is in a moribund state,” the airline says in a press release. Air Moldova states that the company’s administration amid the pandemic could follow only two scenarios – to refund the ticket prices to at most 30% of the passengers, which would have been inevitably led to the company’s bankruptcy, and to make maxim effort to continue its operations and to honor its obligations to 100% of the passengers, despite the own losses.

Tobacco products can no longer be placed in sight
The placing of tobacco and tobacco-related products in retail outlets in sight is banned as of August 15. Under the provisions, the list of tobacco and tobacco-related products available to be bought, with their prices, can be presented by the seller at the request of adult buyers. The list should not contain pictures and the products should not be somehow highlighted by shape, color, lines, decorative or other technical elements. It is also banned placing words or signs showing or suggesting that tobacco products, including heated tobacco products, pipes and accessories, are sold.

Appeals Court rejects prosecutors’ appeals in Metalferos case

The Chisinau City Appeals Court rejected 14 of the 16 appeals filed by prosecutors against ordinary court’s judgments by which the requests to arrest the accused in the Metalferos case were rejected. The court is to yet pronounce on the other two appeals. The Prosecutor General’s Office said the prosecutors insisted on the remand detention of the culprits given the gravity of the accusations, the social resonance of the case and the circumstances that could make the persons impede the investigations and avoid criminal liability. On August 5, the Ciocana branch of the Chisinau City Court rejected prosecutors’ requests to remand the 16 persons arrested in the Metalferos case. The judges decided that nine of the accused, among who are four police officers, will be placed under judicial control, while the other seven will be put under house arrest for a month.

“Ednateric Trans” and “Transeric Tur” are subject to attacks, lawyer

The lawyers for the transport companies “Ednateric Trans” and “Transeric Tur” came with a message to notify public opinion and the law enforcement agencies of Moldova and also the foreign embassies, the prospector general, the Government and Parliament, saying the two companies that pay taxes into the state budget continue to be subject to raider attacks. Lawyer Angela Istrate said that “Ednateric Trans” and “Transeric Tur” provide road transport services in Moldova and on international routes. During the past three years, they have been persecuted with the involvement of the national law enforcers. The lawyer noted that the two companies in 2019 paid 3 million lei taxes into the state budget. In April, they donated 400,000 lei to the National Clinical Hospital in connection with the pandemic. “Even if these companies are registered legally in the Republic of Moldova and have international passenger transport authorizations, the law enforcement agencies, namely the Prosecutor’s Office for Organized Crime and Special Cases together with the Center for Combating Trafficking in Human Beings, start criminal cases against them, over illegal trafficking and illegal migration of persons,” stated Angela Istrate.

Lawyer: Two carriers risk having their operations blocked

The lawyer for the carriers “Ednateric Trans” and “Transeric Tur” Alexandru Bot said attempts are being made to block the operators of the two companies and intimidate their employees. According to him, about 16 searches were carried out at the two companies on August 12, with deviations from procedures. Two buses that belong to a partner company from the Czech Republic were stopped. Searches were carried out at the office of the companies and at the homes of employees. Lawyer Alexandru Bot said that a year ago he informed that state bodies aimed to block the economic activity of the two companies. “At a distance of one year, nothing has changed. Moreover, judging by yesterday’s experience, things have worsened. Respectively, any attempt to change the situation, at least in the justice sector, failed fully I think,” he stated. In the morning of August 12, two buses that belong to a partner company based in the Czech Republic were illegally stopped by persons in balaclavas, near Stăuceni. The passengers were told to get out and searches were carried out. The drivers and conductors had their mobile phones confiscated.

● FRIDAY, August 14

“Ednateric Trans” and “Transeric Tur” are subject to attacks, lawyer

The lawyers for the transport companies “Ednateric Trans” and “Transeric Tur” came with a message to notify public opinion and the law enforcement agencies of Moldova and also the foreign embassies, the prospector general, the Government and Parliament, saying the two companies that pay taxes into the state budget continue to be subject to raider attacks. Lawyer Angela Istrate said that “Ednateric Trans” and “Transeric Tur” provide road transport services in Moldova and on international routes. During the past three years, they have been persecuted with the involvement of the national law enforcers. The lawyer noted that the two companies in 2019 paid 3 million lei taxes into the state budget. In April, they donated 400,000 lei to the National Clinical Hospital in connection with the pandemic. “Even if these companies are registered legally in the Republic of Moldova and have international passenger transport authorizations, the law enforcement agencies, namely the Prosecutor’s Office for Organized Crime and Special Cases together with the Center for Combating Trafficking in Human Beings, start criminal cases against them, over illegal trafficking and illegal migration of persons,” stated Angela Istrate.

Call to law enforcement agencies to return to wrongdoings against “Ednateric Trans” and “Transeric Tur”

Lawyer Anatolie Istrate, who defends the interests of the transport companies “Ednateric Trans” and “Transeric Tur”, calls on the law enforcement agencies and the governmental authorities to return to the complaints concerning the wrongdoings committed against the two carriers, not to shift responsibility from one body to another and not to provide formal answers. “It’s time to return to these complaints and to remedy the situation,” Anatolie Istrate stated. According to the lawyer, the law enforcement agencies, the authorities and the prosecutor general were informed about the illegal actions in relation to the carriers, while other illegalities were described in the complaints submitted to Parliament, the legal commission for appointments and immunities, the Anticorruption Prosecutor’s Office, the prosecutor general, the administration of the Ministry of the Interior in the course of 2019 and at the beginning of 2020. The given institutions were informed about the criminal cases started and wrongdoings committed by the prosecution bodies against the two companies and the founding families of these. “I ask you not to shift responsibility with formal answers, referring these applications from one body to another. It’s time to return to these complaints and to remedy the situation. Do so that we, the citizens of the Republic of Moldova, feel free. The prosecution bodies should be independent, as should be the prosecutor, as the Code of Penal Procedure provides. The businesses in the Republic of Moldova should prosper, but should have guarantees that their activity will not be persecuted and their affairs will not be taken over,” stated the lawyer.

A part of farmers reached Chisinau, while others got stuck in Ialoveni

The farmers from Căușeni and Ștefan Vodă districts, who set off for Chisinau to protest in the afternoon of August 13, parked their tractors under the bridge in Telecentru quarter. Those from Hâncești and Leova remained stuck near the lake in Dănceni village of Ialoveni district. Andrei Dînga, a farmer from Ștefan Vodă, said that about 80 units of transport set off for Chisinau, but only approximately 30 of them reached the capital city, the others being prevented from continuing their way by patrol inspectors. According to the preliminary statement submitted to the municipality, the tractors were to stop on Șoseaua Hâncești St, near the South Bus Station, but their way was barred and the farmers had to turn to the bridge in Telecentru. The farmer noted they have the right to protest and no one can violate it. The farmers are really in a disastrous situation. Mihai Gribincea, a farmer from Hâncești, has told IPN that almost 100 tractors have been blocked on the road, near the lake in Dănceni, staying there for about 20 hours. The police cars blocked their access and there is by a police officer or two near each tractor. The farmers of Cimișlia, Cantemir, Ungheni, Ialoveni, Criuleni and Sângerei district will join in the next few days. After the farmers started their journey to Chisinau with tractors, Prime Minister Ion Chicu said that he had discussions with farmers from Leova, Căușeni and Ștefan Vodă and, in the last case, those were political activists of the DA Platform, who posed as farmers. “The farmers block the roads and cause inconveniences to the people. This is blackmail and we will not accept it,” stated the official.

Recommendations over ban on visibility of tobacco products at points of sale

The National Food Safety Agency recommends storing the tobacco products in drawers, including with horizontal pins, or behind counters. The list of tobacco products available to be bought can be displayed, but must contain only the names of products and their prices, without mentions about promotions. The placing of tobacco and related products in sight is banned as of August 15. In a press briefing, the Agency’s vice director Ion Șalaru said that as a result of discussions with representatives of the tobacco industry, there was designed a guidebook on how to implement the provisions of the given law. The text is available on the Agency’s website. The Republic of Moldova is among the countries with high prevalence of tobacco smoking. Over 43% of the men smoke. The pandemic accentuated the problems caused by smoking. The risk for the persons who smoke to develop complications in case of infection with the novel coronavirus is six times bigger. The prevalence of smoking among teenagers is of 16%. The teens smoke cigarettes, heated tobacco or electronic cigarettes.