ECO-BUS WEEKLY DIGEST 7 September 13. Most important Economy & Business news by IPN
● MONDAY, September 7
Parliament to come together for first sitting this week
The legislative body will hold the first plenary sitting later this week. It is to discuss a number of bills that were approved by the Government last week, Prime Minister Ion Chicu informed after the meeting of the senior state officials.Premier as saying that Parliament will debate the legislative amendments related to the new program with the International Monetary Fund, the amendment of the state budget law and reallocations of funds. Under the amendments to the state budget, the budget for the education system will be increased by almost 140 million lei, 105 million lei of which will be used to raise the salaries of teachers who will work after hours and to provide the schools with preventive anti-epidemic means. Also, the pensioners and recipients of social allowances lower than 3,000 lei a month will get by 900 lei in lump sums.
● TUESDAY, September 8
Gas tariff for end-users could be decreased by 10%
The gas tariff for end-users in the fourth quarter of this year could be by about 10% lower, according to the preliminary calculations. At the same time, Moldovagaz will not ask to raise the price of natural gas supplied to end-users, said the company’s manager Vadim Ceban. Vadim Ceban as saying that the tariff could be lowered owing to the decline in the purchase price of gas to US$100-115 per 1,000 cubic meters. This way, the tariff per 1,000 cubic meters in the fourth quarter of this year could be of 4,079 lei, down from the current tariff of 4,420. Currently, Moldova purchases gas at an average price of US$145 per 1,000 cubic meters. The manager noted Moldovagaz extended the contract with Gazprom and the price formula remained the same. Now the sides are negotiating a new, more advantageous contract.
Moldovagaz headf: Iași-Ungheni gas pipeline is an alternative instrument for Moldova
The Iași-Ungheni gas pipeline is for Moldova an alternative instrument designed to ensure the country’s energy security so that this does not depend on the East only. Moldovagaz does not yet plan to purchase gas from Transgaz as Gazprom offers better commercial conditions, the president of the Administration Board of Moldovagaz Vadim Ceban told a news conference. “We already received cooperation offers from suppliers of Romania and this is absolutely normal. We will act according to the European rules. Modlovagaz or the bodies that will be created after the reorganization of the company will operate according to the European rules. Evidently, first of all we will consider the economic aspect of the supply process,” stated Vadim Ceban. According to him, it is now more convenient to buy gas from Gazprom because the final price contains the related costs, including the transportation up to the border. “If the supplier brings the gas up to the border or the point of entry into the system, we will calculate to see where the transportation route is more convenient and where the price is more convenient,” noted Vadim Ceban. He added that Transgaz is not seen as an opponent and the more advantageous price will matter anyway.
● WEDNESDAY, September 9
Farmers could access funds for agricultural machinery within project
The farmers in Moldova will be able to access financial resources for benefitting from new agricultural machinery as part of the Modernization of Agricultural Machinery and Equipment Project that is implemented with support from Japan. The project was examined in the meeting of the Parliament’s commission on economy, budget and finance. Parliament is to ratify a lending agreement between the Government of the Republic of Moldova and the Japan International Cooperation Agency and also a lending agreement with the Government of Japan. Japan will offer a preferential loan in the amount of about US$18.65 million to the Republic of Moldova to support the Moldovan farmers. The loan will be used to increase agricultural productivity by delivering postharvest agricultural equipment and machinery intended for SMEs.
Ion Perju: We must insure activity in a sector that depends on weather
“The agricultural sector should not depend on the weather or the conditions when we have precipitation or do not have, when we have snow or do not have. To a particular extent, agriculture each year suffers because of the situations we experience, either drought or floods, torrential rain or hail. There are a number of meteorological effects that we cannot control. We must be ready to cope with this situation in agriculture,” Minister of Agriculture, Regional Development and Environment Ion Perju stated in a program on Moldova 1 channel. Official as saying that a solution to the problems faced by farmers yearly is to insure the farmland and agricultural activities. This is not done in the Republic of Moldova yet. “There are many countries in which insurance is something normal. I know that we must insure an activity in a sector that depends on the weather. That’s why insurance is a subject that has been permanently discussed. Even from the start of the subsidization history, in the Republic of Moldova they have always discussed the necessity of the state subsidizing the insurance premiums for the farmers to be motivated to insure themselves,” stated the minister.
Prosecutor general: First results of investigation into banking theft will be visible towards this yearend
By the end of this year, the Prosecutor General’s Office will issue the final indictment against high-ranking officials who were involved in the banking fraud. According to Prosecutor General Alexandr Stoianoglo, these are former functionaries who held executive posts at the National Bank of Moldova (NBM) and other categories of employees who allowed the banking system to implement dubious schemes. Alexandr Stoianoglo noted he took into account the results of the commission of inquiry into the investigation of the banking fraud, which show that ex-Premier Iurie Leancă, former NBM governor Dorin Drăguțanu and former ministers Andrian Candu and Anatol Arapu committed a number of deviations. “The Prosecutor General’s Office is collecting information about members of the National Committee for Financial Stability, the Surveillance Board of the NBM and particular employees of the Ministry of Finance, the Ministry of Economy and others so as to determine their involvement in the fraud,” Alexandr Stoianoglo stated in the program “Natalia Morari’s Politics” on TV8 channel.
Termoelectrica modernizes heat production and supply infrastructure
Termoelectrica has launched a broad process of modernizing the heat and hot water production and supply infrastructure. In the course of this year, the company has implemented a number of strategic investment projects aimed at improving the quality of the provided services and at ensuring the company’s operational optimization. Termoelectrica S.A. director general Veaceslav Eni said that during the last five years the company managed to extensively repair about 135 km of heat pipes. “The process of modernizing the infrastructures of Termoelectrica attracts direct benefits for ensuring the comfort and safety of the inhabitants of the municipality of Chisinau by significantly reducing the disconnections caused by faults, diminishing losses and increasing the reliability of the heating system,” stated Veaceslav Eni. On the whole, 11 sections of heat pipes were fully rehabilitated on a total length of about 5 km, as were approximately 2.5 km of inter-quarter heat pipes. The modernization works on heat pipes were completed on the streets Sarmisegetuza, Andrei Doga, Miron Costin etc. Sections of heat pipes are under repair on the streets Alba-Iulia, Meșterul Manole and Albișoara.
● THURSDAY, September 10
How will National Wine Day be celebrated this year
The 19th National Wine Day will be celebrated on October 3 and 4, 2020 with the slogan “I Become Holiday”. This year, given the COVID-19 pandemic, the stands of wine producers will be placed in the Great National Assembly Square or on the adjoining streets. The previous years, these stands gathered together over 100,000 people and thousands of foreign tourists. In a press release, the National Office of Vine and Wine says the event will take place with the observance of all the safety measures, primarily online, where the results achieved during 19 years, which made this holiday become an event celebrated worldwide, will be taken stock of. The organizers said “I Become Holiday” is actually a call to solidarity with the wine industry. It is an occasion to remember the national legends, to celebrate the successes, to know personalities from the wine industry, to award the best ones, to taste a great variety of wines and to become ambassadors of the Wine of Moldova.
Amendments to state budget law given first reading
The MPs gave a first reading to the bill to amend the 2020 state budget law on September 10. Most of them voted in favor. Under the bill, the state budget revenues will be decreased by 649.5 million lei to 37.201, 5 billion lei, while the expenditure by 1.856,7 billion lei to 53.200,9 billion lei. The deficit will be reduced by 1.207,2 billion lei, from 17.206,6 billion lei to 15.999,4 billion lei, which is 7.8% of the GDP. According to Minister of Finance Sergey Pușcuța, Deputy Prime Minister, among the main factors that led to changes are the adjustment of the budget indicators based on the revised forecasts of the main macro-economic indicators, evolution of the national economy under the pressure of the effects of the COVID-19 pandemic and natural disasters, reduction in costs for some of the non-priority programs, additional support for farmers provided in the form of VAT refund, adjustment of the mandatory health insurance funds and state social insurance budget, including for increasing the one-off allowances for pensioners from 700 to 900 lei.
State social insurance budget amended
The MPs gave a fist reading to the amendments proposed to the 2020 state social insurance budget. The revenues and expenditure of the state social insurance budget will rise by 232 714 000 lei to 24 572 113 lei. The costs related to protection in case of temporary incapacity for work, the protection of elderly people, including due to the rise in the number of persons who asked to have their old-age pensions reexamined, and the provision of lump sums to the recipients of pensions and state social benefits, determined by the increase in the one-off support from 700 to 900 lei and the indexation of pensions two times a year, will be higher. The spending for the sub-program “Family and Child Protection”, including for the financial support for looking after children up to the age of three given the high number of beneficiaries in the first half of this year and the higher allowances, will also be increased.
Measures to support teaches and farmers given first reading
The bill to amend a number of legislative acts to provide assistance to teachers, agricultural producers and other categories of employees and employers given the economic effects of COVID-19 and the drought were adopted by Parliament in the first reading. The MPs voted amendments to the law on the common salary system in the public sector. Under these, the teaching activities performed by teachers, including those with executive posts, in early, primary, secondary, lyceum and extra-school education institutions will not be limited in the first half of the 2020-2021 academic year. The measure covers about 3,900 teachers. Also, favorable conditions will be introduced for applying to the interest subsidization program and VAT refund program intended for agricultural producers affected by drought and other unfavorable weather conditions. The interest will be subsidized as of May 1, 2020 regardless of the loan repayment period. The sum of the VAT that will be refunded will represent the cumulative sum of the land tax paid for 2020 and the salary taxes for the period that corresponds to the VAT refund period.
● FRIDAY, September 11
Moldova will have Electronic Register of Employees
The conception of the automated information system “Electronic Register of Employees” was approved by the Government in its September 10 meeting. The system will enable to automate the processes of keeping records of the employed persons. According to secretary of state at the Ministry of Finance Tatiana Ivanichkina, the system will ensure the keeping of the history related to the labor relations and will facilitate the access to data in real time. This will contribute to combating the phenomenon of payment of salaries “in envelope” and undeclared labor. The utilization of the automated information system “Electronic Register of Employees” could become mandatory as of January 1, 2021 for the Ministry of Finance and the subordinate institutions, the Ministry of Health, Labor and Social Protection, the National House of Social Insurance and the National Health Insurance Company. As from July 1, 2021, this could become mandatory for all the public authorities.
Moldovan carriers could use authorizations for Russia ahead of time
The Moldovan carriers will be able to use the authorizations that were to be issued as of October 1, 2020 ahead of time. This way, the 4,000 authorizations planned for the fourth quarter of this year could be used in September. Such an agreement was reached by the Ministry of Economy and Infrastructure of Moldova with representatives of the Ministry of Transport of the Russian Federation. Under the agreements concluded in the meeting of the joint Moldovan-Russian commission for international road transport of November 6, 2019, this year the Republic of Moldova is to use 16,000 authorizations - 8,000 in the first half and by 4,000 in the last two quarters. However, the quota of 8,000 freight transport authorizations provided by Russia for the first half of this year was used by the end of May and the carriers risked being unable to supply goods to the Russian market.
Central bank given powers to supervise nonbanking financial system
The National Bank of Moldova will supervise the nonbanking financial system. More exactly, the NBM will license, authorize and issue the permit for state registration, will regulate and supervise the activity of insurers, reinsurers and intermediaries in insurance or reinsurance and also of the National Bureau of Motor Insurers of Moldova, savings and loan associations, credit bureaus and nonbanking lending organizations. This is provided in a bill that was given a final reading by Parliament. The powers to oversee the nonbanking financial system will be taken over from the National Commission for Financial Markets on July 1, 2023. The transit period is needed for the central bank to adjust its activity. The Government, which drafted the bill, said the given provisions derive from the need to strengthen the whole financial market and to prevent eventual risks related to the nonbanking financial sector.
Amendments to state budget adopted, opposition dissatisfied
The MPs adopted the amendments to the 2020 state budget law after giving them a final reading by 59 votes in favor. After the first reading, the MPs proposed over 40 amendments that were endorsed by the Government, while the opposition’s proposals were mainly rejected. Consequently, the government was harshly criticized, the opposition saying the amendments are “purely electoral” in character. In the same sitting, the legislature adopted amendments to the mandatory health insurance funds law and the social insurance budget law. In a press briefing, the members of the Pro Moldova group expressed their indignation because their amendments weren’t supported. They proposed immediately doubling the salaries of teachers and healthcare workers, but this proposal was rejected even if budget funds were identified for the purpose.
Moldovans working in Romania freed from obtaining work permit
The citizens of the Republic of Moldova who work in Romania on an individual work contract fulltime, for at most nine months during a calendar year, are exempted from obtaining a work permit. The General Inspectorate for Immigration of Romania said the made legislative amendments cover also Ukraine and Serbia. The citizens of these three states who want to work under the new provisions can apply for a long-stay visa for employment purposes without presenting the copy of the work permit.
