The Republic of Moldova is a factory of economic stimuli provided under different instruments, including individual assistance offered both by the central public authorities and the local ones. This is the conclusion of a study presented by the Institute for Development and Social Initiative “Viitorul”, IPN reports.

The state support has substantially increased. At the same time, the funds allocated for supporting small and medium-sized enterprises (SMEs) decreases about three times each year. Such intervention cannot solve the market failures. On the contrary, it creates unfair competition, said “Viitorul” consultant Georgeta Mincu.

The latest data show the financial stimuli for dealing with market failures provided from the state budget in 2015 came to €260 million, while from foreign funds to €330 million. State assistance is mainly provided for: economic and general interest services (utilities and infrastructure) – 1bn lei, financial services – 734 million lei, research and innovation – 285 million lei. The state assistance for creating jobs and supporting SMEs in 2015 totaled only 35 million lei.

“A stimulation scheme should also be create for all the dimensions of enterprises and special attention should be devoted to the special needs of SMEs. The system of stimuli should be based on clear distribution criteria and should be planned so that it could be easier used at low administrative costs for participating enterprises and also for state suppliers,” stated Georgeta Mincu.

The study author recommends reducing the share of state support by renouncing budget revenues (exemptions, discounts) and by increasing the assistance provided in the form of budget costs (funds to support entrepreneurs, investments in technologies and modern equipment, financial guarantees and preferential loans). The authorities should also eliminate the provision of individual assistance and should increase the number of measures implemented as part of transparent and accessible state support programs.