ECO-BUS WEEKLY DIGEST September 27 – October 02. Most important Economy & Business news by IPN
● MONDAY, September 27
Chisinau asks for EU assistance for SMEs during pandemic
Prime Minister Natalia Gavrilița, who is in Brussels on a visit, and European Commissioner for Economy Paolo Gentiloni discussed the necessity of making headway with the recovery of the money stolen as a result of the bank fraud. The Premier underlined the firm commitment to investigate and recover these funds, noting that a functional legal system is needed for the purpose. Natalia Gavrilița asked for the European partners’ assistance in strengthening the sustainable mechanisms for supporting the small and medium-sized companies in Moldova, including by introducing partial unemployment and technical unemployment mechanism, so that these cope with the challenges during the pandemic, IPN reports, quoting the Government’s press service.
The two officials discussed the reforms in the customs and fiscal sectors. In this connection, Premier Gavrilița provided details about the adoption of the Customs Code that was adjusted to the EU legislation, this being one of the important conditions for extending the cooperation with the EU in the customs sector. The new Code aims to unify, modernize and improve the customs legislation and to align this with the commitments undertaken by Moldova through the Association Agreement with the EU.
The Premier also spoke about the importance of the Eastern Partnership and the Deep and Comprehensive Free Trade Agreement, saying the Government’s policies are aimed at developing the economic model that matches the European economic model, being centered on digitization, energy efficiency and green economy.
Natalia Gavrilița expressed her gratitude for the support from which the Republic of Moldova benefitted through the OMNIBUS MFA program and for the decision to disburse the second tranche of OMNIBUS assistance of €50 million, which is expected to come to Moldova at the start of October.
● TUESDAY, September 28
Wheat harvest is largest in last 30 years, expert
As many as 1.552 million tonnes of wheat have been harvested in Moldova this year, by 1 million tonnes more than last year. This is the largest harvest on record in the last 30 years, Vasile Șarban, secretary of state at the Ministry of Agriculture and Regional Development, stated for IPN.
Vasile Șarban said that 260,600 tonnes of barley and 88,700 tonnes of rape have been harvested this year.
The large harvest of grain crops this year is due to the abundant rain and the modern technologies used to cultivate selected sorts of grain crops. The bumper crop will definitely enable to ensure the country’s food security.
The latest rises in bread price are due to price rises in the region and at global level, determined by the costs incurred for electricity and raw materials.
“If the wheat grows more expensive at the Paris Stock Exchange, prices grow everywhere and mills buy wheat at higher prices. Flower is more expensive and bread and other baked products are sold at higher prices,” explained Vasile Șarban.
The Ministry of Agriculture and Regional Development is considering possibilities of intervening in the domestic grain market so as not to allow other rises in bread prices. “The state is obliged to ensure the country’s food security. We also want to increase the quantity of wheat in the state reserve. The state can purchase wheat and store it for being used when necessary,” stated the secretary of state.
Lending agreement with EBRD for restructuring railroad infrastructure to be signed in October
Amendment No. 2 to the lending agreement between the Republic of Moldova and EBRD for implementing the project to purchase locomotives and to restructure railroad infrastructure will be signed in Chisinau in October. The EBRD Managing Director for Eastern Europe and the Caucasus Matteo Patrone is expected to come to Chisinau then.
According to Minister of Infrastructure and Regional Development Andrei Spînu, the money that will be allocated after the signing of the amendment will come in addition to the €27.5 million intended for the reconstruction of railroad infrastructure in the country. “We start the week with good news. The plan for the rehabilitation of the Bender-Căușeni-Basarabeasca-Etulia-Giurgiulești rail road section has taken a clearer shape,” Andrei Spînu posted on his Facebook page.
The decree on the initiation of negotiations and approval of the signing of Amendment No. 2 to the lending agreement between the Republic of Moldova and the European Bank for Reconstruction and Development for implementing the project to purchase locomotives and to restructure railroad infrastructure was signed by President Maia Sandu on September 27.
EU disburses €36.4 million for Moldova
Today, the European Union has disbursed a grant of €36.4 million for the Republic of Moldova to continue supporting country’s fight against COVID-19 and police reform. Commissioner for Neighborhood and Enlargement Olivér Várhelyi confirmed the disbursement during the visit of Prime Minister Natalia Gavrilița and Deputy Prime Minister, Minister of Foreign Affairs and European Integration Nicu Popescu in Brussels.
In a post on Facebook, Natalia Gavrilița said that she discussed the Moldovan Government’s priorities and the promotion of Moldova’s European agenda with the European official. They also discussed the justice sector reform, the economic recovery and improvement of the business climate, the management of the pandemic crisis and immunization of the population and also the consolidation of state institutions.
The Premier noted that Moldova is ready to raise the Moldova-EU relationship to a higher level. A new Association Agenda with the EU is to be adopted at the upcoming meeting of the Association Council. “We want to include issues related to security, justice and energy in the political dialogue. We bank on the identification of concrete support projects by the Directorate General for Neighborhood and Enlargement Negotiations of the European Commission (DG NEAR),” wrote Natalia Gavrilița.
For his part, Commissioner Oliver Varhelyi announced the intention to launch a pilot project to modernize the economy in rural localities all over the country by developing the food industry and agriculture. This way, there will be created well-paid jobs, the villages will develop and the citizens will no longer leave the country.
● WEDNESDAY, September 29
EIB to provide about €60m to horticultural sector
Since the credit line Moldova’s Orchard was launched, over 280 investment projects benefitted from EU funds provided through the European Investment Bank. The funds of about €60 million that are available at present will be provided to other beneficiaries, the new Head of the EIB Office in the Republic of Moldova, Alberto Carlei, who recently arrived in Chisinau, announced in a meeting with journalists at Europe Café. He presented the results of the European Investment Bank’s work in Moldova.
According to Alberto Carlei, since the start of 2021, 82 beneficiaries of the credit line Moldova’s Orchard received loans to the total value of €12.6 million. Moldova’s Orchard is a key operation of the EIB whose goals is to support the private sector in Moldova. “This credit line contributed to revitalizing the horticultural sector and helped many small and medium-sized enterprises to better positron themselves on the Moldova market that is very competitive and narrow, helping them also to diversify export destinations,” said the Head of the EIB Office in Moldova.
Alberto Carlei also said that 25 investment projects to the total value of about €800 million, which covered different areas and supported SMEs, have been implemented since 2007, when the cooperation between the EU and Moldova started. “The European Investment Bank will continue its commitments in the Republic of Moldova through the support offered to implement the EU Green Deal, to improve energy efficiency, to continue financing strategic infrastructure projects in key sectors, such as transport and waste management, digitization of the Moldovan economy and support for SMEs and the private sector.”
About 40% of the financial resources provided by the EU through the EIB went to the private sector, for rehabilitating national roads and purchasing new trolleybuses in Chisinau, over 30% - to the SME sector, primarily for horticultural and winemaking SMEs, approximately 16% - to the energy sector, the EIB supporting the implementation of such projects as the Ungheni-Chisinau gas pipeline and the improvement of the reliability of the electricity transmission system in Moldova.
There are also initiatives under implementation, such as the Solid Waste Management Program, the Energy Efficiency in Chisinau Program and the Energy Interconnection with Romania Project.
FAO contributes to promoting agri-tourism in Moldova
FAO Moldova has launched the component “Rural Development for Promoting Agri-Tourism and Traditional Products in the Republic of Moldova” in Drochia town. This is part of the FAO project to support the capacities to promote agrifood products, IPN reports.
The event to launch this component was held in connection with the International Day of Awareness of Food Loss and Waste that is observed on September 29. Two years ago, the UN General Assembly designated this day in a move to raise awareness of the importance of the problem and its possible solutions at all levels.
The rural development component is implemented by the Farmers’ Federation of Moldova “FARM”. There were identified ten tourist attractions in Drochia district, including a peasant farmstead growing organic vegetables, a small cheese factory, a wooden church that is 230 years old, a local Jewish cemetery, an ostrich farm and others.
“By this project, FAO aims to support the agricultural sector in Moldova by improving policies to promote and market agrifood products. Through the component launched today, we lay emphasis on the promotion of traditional products typical of some of the localities in the country, which will have a positive impact on the development of agri-tourism in rural areas in general,” said FAO Deputy Representative in Moldova Tudor Robu, being quoted in a press release
The FAO project to support the capacities to promote agrifood products is implemented during March 1, 2019 – December 31, 2021. The total value of the project is US$300,000.
● THURSDAY, September 30
Pays of administrative-housekeeping personnel of hospitals to be raised by 57%
The salaries for the administrative-housekeeping personnel will be increased by 57% as from November 1. Also, the Government aims to provide a bonus to the medical personnel involved in the provision of medical assistance to patients confirmed with COVID-19. In this regard, the Government approved amendments to the law on the mandatory health insurance funds for 202.
The approved document specifies the incomes and costs of the mandatory health insurance funds following an analysis of the indicators of the funds in the course of the year and in accordance with the agreed priorities.
Under the document, the incomes will rise by 313 223 lei or 2.8% to 11 457 321 lei, while the costs will grow by 513 223 lei or 4.5% to 11 857 321. The deficit will be covered with the balance formed at the start of the year.
Government to sign agreement to put again into force assistance agreements with U.S.
The Government of the Republic of Moldova will sign an agreement to bring again into effect a number of assistance agreements with the U.S. Government for recovering over US$70 million that wasn’t used earlier. The Cabinet on September 30 approved a draft decision to this effect.
The goal of the agreement is to restore the legal effects of two assistance agreements signed by the Government of the Republic of Moldova and the Government of the U.S. in 2016, which expired in May-June 2021, and to extend the period of validity of this agreement until December 31, 2025.
The grant allocated under the assistance agreement concerning the development objective for increasing trade and investments in the key sectors totals US$90.6 million, with US$27.6 million being unused. For the agreement on the development objective for more efficient and responsible democratic governance, the grant is US$76.9 million, with about US$45 million being unused.
The agreement will take effect when it is signed.
Maia Sandu at Moldovan-German forum: State wants to be business people’s partner, not guardian
Investors are needed to improve the life of citizens and when these come, the state will make sure to create a favorable business clime where the fiscal, juridical and other kinds of relations with the authorities’ are clear, transparent and well intentioned, President Maia Sandu stated in the bilateral Moldova-Germany business forum held in Chisinau on September 29, IPN reports.
“The Republic of Moldova wants to be the partner, not the guarding of the businesspeople,” stated President Sandu.
She noted that the Republic of Moldova was shaken by corruption and banking and juridical scandals, but the new government undertook to put things right and to do an authentic reform in the justice sector, to bring corruption to an end and to ensure clarity in the business-state relationship and the stability of the banking system and to guarantee by law the protection of property and investments. Moldova offers opportunities to the business community and these should be now taken.
Attending the event, the President of Germany Frank-Walter Steinmeier said that he found in Moldova an established German business community. The Federal Government consented to provide about €10 million for development cooperation projects by which Germany aims to give an impetus to the reforms initiated by Maia Sandu. The political reforms, the fight against corruption and functional administration are the main pillars of a successful community and a precondition for gradual rapprochement with the EU, up to an accession perspective.
Frank-Walter Steinmeier expressed his confidence that the road followed by Moldova can take the country to a better future. In this regard, Germany will ensure full support. But the change needs the contribution of a viable civil society, a strong economy that creates jobs and people who see a better future for them and their children. Germany and Moldova are already reliable commercial partners. The German direct investment came to €275 million, while the companies here created over 9,000 jobs.
Ion Iordachi, acting director general of the Investment Agency “Invest Moldova”, voiced hope that the results in the new cooperation relations between Moldovan and German companies will appear swiftly. Germany remains one of the most important partners of the Republic of Moldova, ranking third by the volume of commercial exchanges, which exceeded US$341 million in the first half of this year. The economic cooperation with Germany is intense and beneficial to the Republic of Moldova, while the country’s government makes effort to maintain and extend the economic relations. Moldova signed 57 mostly economic agreements and additional documents with Germany. Over 400 companies with German capital operate in Moldova. The Investment Agency offers support to the Moldovan producers in the process of entering the German market and to the German companies in the process of investing in the Republic of Moldova.
Ulich Nussabaum, secretary of state at the Federal Ministry for Economic Affairs and Energy of Germany, said that reliable framework and legal conditions are needed to enable successful investments and to create a confidence basis for investors.
FRIDAY, October 1
Moldova will pay US$790 per 1,000 cubic meters of gas in October
Moldova will pay US$790 per 1,000 cubic meters of gas in October, as opposed to US$550 a month before. The contract with Gazprom, which expired on September 30, was extended for a month so as not to interrupt the supply of natural gas until a new agreement is signed and to negotiate a better price, said Deputy Prime Minister Andrei Spînu, Minister of Infrastructure and Regional Development. He assured that the higher price of gas for this month will not affect the end-users, IPN reports.
Andrei Spînu is confident that a month is enough to complete the negotiations. Next week, together with functionaries from Moldovagaz, he will take part in the St. Petersburg International Gas Forum where they will have discussion with the administration of Gazprom.
Andrei Spînu said that until a new long-term contract is signed, the tariffs for end-users will not change. In the short term, the costs will be covered by Moldovagaz. “We realize that the situation is difficult, but we guarantee that we will keep the prices under control. Until we find an optimal compensation solution for the citizens, all the necessary measures will be taken to prevent changes in bills,” stated Andrei Spînu.
He noted that Moldova, as other states, faces an unprecedented situation on the gas markets in Europe: prices rose to over USD$1,000 per cubic meter. This situation cannot be influenced by measures that can be taken by the Gavrilița Government.
In another development, Andrei Spînu said that the Iasi-Ungheni gas pipeline will become functional next week. The price of gas rose in Romania too and the price for Moldova will not be lower if gas is supplied through this pipe.
COVID-19 certificate is mandatory for those served inside public eating places
As from October 1, the COVID-19 certificate is mandatory for persons served at tables situated inside public eating places, not yet for those who are served at terraces and those who go in to use sanitary facilities or to place orders and get the takeout, the Government specified at the request of the National Association of Restaurants and Leisure Facilities of Moldova (MĂR).
In a press release, MĂR says the excepted persons will obey the general public health norms, including maintaining physical distance of one meter and wearing a face mask.
The persons designed at public eating places to ask for COVID-19 certificates from visitors can also ask for an identification document or another document showing that the COVID-19 certificate applies to them.
If the COVID-19 certificate is false or belongs to someone else, the representatives of inspection bodies will take measures in relation to the persons who presented the given document in accordance with the Contravention Code.
SATURDAY, October 2
Moldova 64th in Global Innovation Index
Moldova takes the 64th spot in the 14th annual Global Innovation Index (GII) 2021 report published by the World Intellectual Property Organization (WIPO), going down four spots compared with last year, IPN reports, quoting seenews.com.
Among the countries of Southeast Europe (SEE), Slovenia again tops the list on the 32nd spot, maintaining its position from the 13th edition of the report. Bulgaria follows in 35th place, Croatia in 42nd, Greece (47), Romania (48) and Montenegro (50), the report entitled “Tracking Innovation through the COVID-19 Crisis” showed.
Outside the top 50, Serbia ranks in 54th position, while North Macedonia and Moldova are in 59th and 64th position, respectively. Bosnia and Herzegovina ranks 75th, followed by Albania, which is the lowest ranked country in SEE - in 84th place out of a total of 132 countries reviewed.
Almost all SEE countries moved lower in the ranking compared to the 2020 edition, except for Bulgaria and Slovenia. Moldova and Greece descended the most, by five and four places, respectively.
Switzerland topped the ranking, while Montenegro scored lowest among the top 50 states in the report.
The source noted that as of 2021, the GII is published by WIPO in partnership with Washington DC-based Portulans Institute, various corporate and academic network partners and the GII Advisory Board.
