ECO-BUS WEEKLY DIGEST November 9-15. Most important Economy & Business news by IPN
● THURSDAY, November, 12
No local public administration issues municipal bonds, study
In the Republic of Moldova, even if the legislation enables the local public authorities of all levels to issue municipal bonds, none of these entities took such a step. The causes are multiple, being both legislative and investment in character or even reflated to financial infrastructure. On the one hand, the interaction with the capital market necessitates special financial and economic forecast capacities in the LPA. On the other hand, the current legal framework does not favor the issuing of and investment in municipal bonds, shows a study carried out by the Independent Think Tank “Expert-Grup” that is quoted by IPN. The study notes that the municipal bonds play their role in the mixture of financial instruments and the most appropriate one is to finance investment projects with direct or indirect incomes or to co-finance grant projects and obtain positive financial levier. Despite particular flexibilities of bonds, the LPAs must treat their obligations in the same way as those to a commercial bank.
● FRIDAY, November, 13
Ion Chicu: Moldova is immune to shocks caused by politicians
The year 2019 was generally ended rather well given the electoral and political particularities of the year, with a budget deficit of 1.4% and an economic growth of 3.6%, Prime Minister Ion Chicu said when presenting a report on the work done during a year of his appointment. He estimated that the GDP in 2020 will decline by at most 6.5%. Ion Chicu noted that the budgetary-fiscal and economic performance of the country in 2019 and 2020 shows that Moldova is already immune to the shocks caused by politicians. The pandemic was the main blow in the period and the involvement of the political class and speculations were the main problem in containing the pandemic. The negative effect of the pandemic was felt in April-May, when the budget losses came to billions. The GDP in the second quarter of the year decreased by 14%.
Basic inflation will decrease until this yearend
The basic inflation will decrease until the end of this year, but will increase towards the forecasting period - 2022. The decline in the basic inflation is due to the disinflation pressure on the part of the internal aggregate demand. The subsequent trajectory of the basic inflation will be primarily influenced by the adjustment of excise duties in 2021 and 2022, says inflation report No. 4 presented by National Bank governor Octavian Armașu. The governor noted that the annual pace of food prices will decrease insignificantly in the first half of the forecasting period and will rise in the second half. The diminution of the annual pace of food prices will be due to the internal aggregate disinflation demand and anticipated reduction in international food prices next year. The subsequent rise will be influenced by the effect of the seasonal products, recovery f aggregate demand and adjustment of excise duties.
